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Tuscaloosa Economic Outlook

Tuscaloosa Economic Outlook . Ahmad Ijaz Center for Business and Economic Research Culverhouse College of Commerce and Business Administration The University of Alabama http://cber.cba.ua.edu (205) 348-6191. West Alabama Real Estate Summit Tuscaloosa, Alabama August 24, 2012.

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Tuscaloosa Economic Outlook

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  1. Tuscaloosa Economic Outlook Ahmad Ijaz Center for Business and Economic Research Culverhouse College of Commerce and Business Administration The University of Alabama http://cber.cba.ua.edu (205) 348-6191 West Alabama Real Estate Summit Tuscaloosa, Alabama August 24, 2012

  2. Overview: U.S. Economic Conditions • Economic recovery has lost momentum, but has not come to a halt • Inventory cycle caused relatively strong growth in late 2011 and early 2012 • 2.1 percent economic growth expected for U.S. in 2012 and 1.8 percent for 2013, chance of another recession is currently at 25 percent • Commercial and industrial loan market is gradually reviving • Center for Business and Economic Research, The University of Alabama2

  3. Downside Risks • State and local governments continue to lay off workers • Relatively tight credit and loan markets • Housing markets remain weak and distressed • Rising gasoline and food prices • External risks (Eurozone and China) • Lack of income growth • Economy will require much faster job growth for a sustained recovery • Center for Business and Economic Research, The University of Alabama 3

  4. Consumer sentiment improving, but still weak Source: University of Michigan.

  5. Productivity growth has run out of steam Source: Federal Reserve Board.

  6. Commercial and industrial loan market reviving gradually Source:

  7. U.S. Economic Outlook Source: IHS Global Insight, August 2012.

  8. Monthly Employment Indicators (July 2012) Source: Alabama Department of Industrial Relations, Labor Market Information Division.

  9. Alabama Nonagricultural EmploymentChange in Number of Jobs Source: Alabama Department of Industrial Relations, Labor Market Information Division.

  10. Share of Total Nonfarm Employment (2011) andShare of Alabama Gross Domestic Product (2010) Source: U.S. Bureau of Economic Analysis. Source: Alabama Department of Industrial Relations.

  11. Tax Revenues (Fiscal Year to Date, July) Source: Alabama Department of Revenue.

  12. Total Monthly Nonfarm Employmentand Unemployment Rate Employment (Thousands), Unemployment Rate (Percent) January 1990 – July 2012 Nonfarm Employment Unemployment Rate Source: Alabama Department of Industrial Relations.

  13. Total Annual Nonfarm Employmentand Unemployment Rate Employment (Thousands), Unemployment Rate (Percent) 1990-2012 Employment Unemployment Rate Nonfarm Employment Unemployment Rate Source: Alabama Department of Industrial Relations.

  14. Change in Employment From the Beginning of the Recession (Number of Months) Number of months

  15. ABCI™ History Index 50.2 31.5 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

  16. Business Environment Expectations Q3 2012 compared to Q2 2012

  17. Industry Performance ExpectationsSales and Profits Q3 2012 compared to Q2 2012 Sales Profits

  18. Industry Performance ExpectationsHiring Plans and Capital Expenditures Q3 2012 compared to Q2 2012 Hiring Plans Capital Expenditures

  19. ABCI™ Index 2010 2011 2012

  20. Alabama Forecast Summary • This Alabama GDP and employment forecast summary is the CBERJuly 2012 preliminary forecast • Preliminary 2013 forecast included below Probability: Forecast (60 Percent) and Range (90 percent)

  21. Alabama Gross Domestic Product andEmployment by Metro Areas Source: Alabama Department of Industrial Relations, U.S. Bureau for Economic Analysis.

  22. Population gains varied widely over last decade 4/1/2000 to 4/1/2010 Number Percent 4/1/2010 Change Change Alabama 4,779,736 332,636 7.5 Anniston-Oxford 118,572 6,323 5.6 Auburn-Opelika 140,247 25,155 21.9 Birmingham-Hoover 1,128,047 75,809 7.2 Decatur 153,829 7,962 5.5 Dothan 145,639 14,778 11.3 Florence-Muscle Shoals 147,137 4,187 2.9 Gadsden 104,430 971 0.9 Huntsville 417,593 75,217 22.0 Mobile 412,992 13,149 3.3 Montgomery 374,536 28,008 8.1 Tuscaloosa 219,461 27,427 14.3 Source: U.S. Census Bureau.

  23. Median Family Income FY2011

  24. Metro-Area Unemployment Rates Source: Alabama Department of Industrial Relations, Labor Market Information Division.

  25. No metro back to 2007/2008 annual peak in 2011 2007 or 2008 Job Loss to 2011 Nonfarm Employment Peak Year Number Percent Alabama 2,003,800 -134,800 -6.7 Anniston-Oxford 53,500 -4,800 -9.0 Auburn-Opelika 54,800 -2,200 -4.0 Birmingham-Hoover 531,300 -43,200 -8.1 Decatur 58,500 -5,100 -8.7 Dothan 63,100 -7,000 -11.1 Florence-Muscle Shoals 57,300 -1,800 -3.1 Gadsden* 38,100 -2,900 -7.6 Huntsville* 214,300 -6,600 -3.1 Mobile* 184,700 -9,800 -5.3 Montgomery 179,200 -13,200 -7.4 Tuscaloosa* 98,500 -5,800 -5.9 Net Jobs in Metropolitan Areas -102,400 Net Jobs in Nonmetro Counties -32,400 * Gadsden, Huntsville, Mobile, and Tuscaloosa employment peaked in 2008; all others saw peaks in 2007. Note: Nonfarm employment (jobs) is by place of work. Data are January to November averages. Source: Alabama Department of Industrial Relations and U.S. Bureau of Labor Statistics.

  26. ABCI by Metro Area Q3 2012(Tuscaloosa – 51.0)

  27. Tuscaloosa Metro Area Nonfarm Employment

  28. Change in Tuscaloosa Metro Employment From the Beginning of the Recession Center for Business and Economic Research, The University of Alabama

  29. Tuscaloosa Metro AreaGDP and Nonfarm Employment Source: U.S. Department of Commerce, Alabama Department of Industrial Relations, and Center for Business and Economic Research, the University of Alabama.

  30. Questions, comments, suggestions, discussion,… Thank You Ahmad Ijaz Center for Business and Economic Research Culverhouse College of Commerce and Business Administration The University of Alabama http://cber.cba.ua.edu (205) 348-6191

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