Salem Economic Outlook

Transcription

1 Salem Economic Outlook November 2012 Tim Duy, PHD Prepared for the Salem City Council November 7, 2012

2 Roadmap US Economic Update Slow and steady Positives: Housing/monetary policy Negatives: Rest of world/fiscal policy A Quick Look at Oregon Salem Area Business Index Forecasts for Oregon Job Growth Baseline State-like assumptions Fiscal Cliff Salem Area Job Forecasts Revenue Implications

3 Slow and Steady

4 Still Well Below Trend

5 Slow and Steady

6 Housing on the Mend - Finally

7 Housing on the Mend - Finally

8 Housing on the Mend - Finally

9 Manufacturing Hits Headwind

10 International Drag

11 Austerity Already

12 Monetary Boost

13 Nothing to See Here

14 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Oregon On the Upswing UO Index of Economic Indicators Blue: UO Index, 1997=100, Left Axis Gray: Probability of Oregon Recession, Right Axis % 80% 60% 40% 20% 0%

15 Mar-90 Dec-90 Sep-91 Jun-92 Mar-93 Dec-93 Sep-94 Jun-95 Mar-96 Dec-96 Sep-97 Jun-98 Mar-99 Dec-99 Sep-00 Jun-01 Mar-02 Dec-02 Sep-03 Jun-04 Mar-05 Dec-05 Sep-06 Jun-07 Mar-08 Dec-08 Sep-09 Jun-10 Mar-11 Dec-11 Sep-12 Not the Fastest Growth Oregon Measure of Economic Activity Black: Three Month Moving Average, Left Axis Gray: Real Oregon Personal Income less Transfer Payments, % Change y-o-y, Right Axis % 6% 4% 2% 0% -2% -4% -6% -8% -10%

16 Business Index Components

17 Business Index Components

18 Business Index Components M a r i o n C o u n t y S o l i d W a s t e T o n s S a l e m E c o n o m i c O u t l o o k N o v e m b e r

19 Business Index Components S a l e m L o d g i n g R e v e n u e D o l l a r s S a l e m E c o n o m i c O u t l o o k N o v e m b e r

20 Business Index Components

21 Business Index Components U n i v e r s i t y o f O r e g o n I n d e x o f E c o n o m i c I n d i c a t o r s I n d e x = S a l e m E c o n o m i c O u t l o o k N o v e m b e r

22 Business Index Components S a l e m M S A N o n f a r m P a y r o l l s T h o u s a n d s E m p l o y e e s S a l e m E c o n o m i c O u t l o o k N o v e m b e r

23 Salem Reaches a Bottom S a l e m A r e a B u s i n e s s I n d e x I n d e x = S a l e m E c o n o m i c O u t l o o k N o v e m b e r

24 Aug-99 May-00 Feb-01 Nov-01 Aug-02 May-03 Feb-04 Nov-04 Aug-05 May-06 Feb-07 Nov-07 Aug-08 May-09 Feb-10 Nov-10 Aug-11 May-12 Still, Very Low Growth Salem Index of Economic Activity Six-month moving average in black

25 Oregon Outlook

26 Many Potential Paths

27 US Growth Forecasts

28 Oregon Forecasts

29 Oregon Forecasts

30 Oregon Forecasts O r e g o n G e n e r a l F u n d R e v e n u e s P e r s o n a l a n d C o r p o r a t e I n c o m e T a x, $ M i l l i o n s A u g u s t E c o n o m i c F o r e c a s t S a l e m E c o n o m i c O u t l o o k N o v e m b e r

31 Oregon Forecasts

32 Fiscal Cliff?

33 Very Different Outcome

34 Salem Lagging Or Not?

35 Compare to Portland

36 Adjusted Nonfarm Payroll Data

37 Adjusted Nonfarm Payroll Data

38 Slow Revenue Growth Cumulative Shortfall: $83 million! Salem Total Operating Revenue Actual and Projected (Blue) and Trend FY2005 to FY 1014 (Red) $130,000,000 $120,000,000 $110,000, % $100,000,000 $90,000,000 $80,000,000 $70,000,000 $60,000,000 $50,000,000 $40,000, % % % 09-10: $93.7 mil : $93.5 mil : $96.9 mil : $96.7 mil : $97.8 mil

39 Jan-05 Jun-05 Nov-05 Apr-06 Sep-06 Feb-07 Jul-07 Dec-07 May-08 Oct-08 Mar-09 Aug-09 Jan-10 Jun-10 Nov-10 Apr-11 Sep-11 Feb-12 Jul-12 Slow Revenue Growth Salem Residential Building Permits, New SFD/DPLX, Value Actual (Blue) and Average Jan. 05 to Jun. 07 (Red) $25,000,000 $20,000,000 $15,000,000 $10,000,000 Lost Taxable Value: $567 million $5,000,000 $0