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The Southeastern States: Recent Performance and Prospects for Recovery

The Southeastern States: Recent Performance and Prospects for Recovery. Phil Hopkins Principal, US Regional Services 610-490-2657 philip.hopkins@globalinsight.com. Macro Effects on Regions & States. Investment-Led Recession – Mfg. Decline Started in the Midwest, Spread to the Coasts

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The Southeastern States: Recent Performance and Prospects for Recovery

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  1. The Southeastern States: Recent Performance and Prospects for Recovery Phil Hopkins Principal, US Regional Services 610-490-2657 philip.hopkins@globalinsight.com

  2. Macro Effects on Regions & States • Investment-Led Recession – Mfg. Decline Started in the Midwest, Spread to the Coasts • High Tech Collapse Hit High-Growth States Hard • World Economy is Slow – No Help from Abroad • Jobless Recovery • State Budgets in Deficit - $70 to $90 Billion – partially offset Federal Stimulus • 43 States With Budget Deficits

  3. Macro Effects on Regions & States • State Tax Revenues Still Stagnant • Stock Market Crash – Wealth Effects Hit High-Growth States Hard – CA, VA, FL, CO, MA, IL, NV, NY • Increase in Defense Spending Benefits Sun-Belt States – MS, GA, CA, TX, VA • Excess Capacity Remains

  4. Mfg. % of Total Employ. (SIC, 2002)

  5. Historic Economic Trends

  6. Why Did the SE States Grow? • Shift-Share: Decompose regional growth into 3 Effects: • National Growth; Growth in US Economy • Industry Mix - % Shares of high-growth and slow-growth sectors as defined at the US level • Competitive Effects: individual sectors in region grow faster than same sectors at US Level • Results SE Region: 1990 to 2002 Employment Change • 72% of Employment Growth 1990 to 2002 due to Growth in US economy • -5.8% due to Industry Mix (too many slow growth industries • 33.2% due to Competitive Effect (SE sectors grew faster than same sectors as US level

  7. Personal Income Growth

  8. Per Capita Personal Income

  9. Real Wage Per Worker

  10. Manufacturing Employment

  11. Growth in Real GSP/GDP per Worker

  12. Growth in Housing Starts

  13. Services-Producing & Construction Employment Changes

  14. Employment Cycles- FL, GA, and US

  15. Recent Economic Performance

  16. % Change in Goods Providing Employment March 01 – February 03

  17. % Change in Service Providing Employment March 01 – February 03

  18. % Change in Total Employment – March 01 - February 03

  19. Employment Change in SE States March 2001 to February 2003

  20. February 2003 Conditions

  21. 2002 Values for Selected SE MSAs

  22. 2002 Values for Selected SE MSAs

  23. Housing Trends

  24. Median Housing Price Growth1999-2002 US +6.5%

  25. Median Price of Single Family Home Over Average Household Income – 2002q2

  26. Housing Starts/Population 2002

  27. % Change Year Ago Housing Starts by State – 2002q4

  28. Regional Housing Start Trends

  29. South Atlantic Housing Trends

  30. Housing Trends – Selected MSAs

  31. Housing Trends – Selected MSAs

  32. Travel and Tourism

  33. Reliance on Travel & Tourism % Employment in Travel & Tourism Industries in 2000

  34. Annual Growth in Travel & Tourism Employment 1995-2000

  35. Foreign Travel has Fallen % Change in Visitor Arrivals

  36. Global Insight’s Spring 2003 Forecast for the Southeastern States

  37. Total Employment Growth Rate2002 to 2007

  38. Personal Income Growth Rate 2002 to 2007

  39. Housing Start Growth Rate2002 to 2007

  40. Real GSP Growth Rate2002 to 2007

  41. Steps To Economic Recovery Competitive Advantages Remain and Will Re-Assert Themselves Identifying and Nurturing Industry Clusters Education Matters at All Levels Cost Advantages for All Types of Infrastructure and Utilities Access to Research and Capital a Key Quality of Life Key to Attracting Creative Workers and Companies Needing Them

  42. Steps To Economic Recovery When Will Employment and Investment Recover? Public/Private Ventures, Especially in University MSAs Keeping the Consumer Spending State Government Budgets In Balance Use of Selected, Prudent Economic Incentives

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