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Babson Capital/UNC Charlotte Economic Forecast March 11, 2014

Babson Capital/UNC Charlotte Economic Forecast March 11, 2014. Outline for Today. Review of 2013 Positive Economic Signs Negative Economic Signs North Carolina Outlook for 2014 The Employment Picture Regional Perspective Housing Trends. Current Expansion. Began July 2009 56 months

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Babson Capital/UNC Charlotte Economic Forecast March 11, 2014

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  1. Babson Capital/UNC CharlotteEconomic ForecastMarch 11, 2014

  2. Outline for Today • Review of 2013 • Positive Economic Signs • Negative Economic Signs • North Carolina Outlook for 2014 • The Employment Picture • Regional Perspective • Housing Trends

  3. Current Expansion • Began July 2009 • 56 months • 7th longest of 33 total expansions since December 1854

  4. North Carolina in 2013

  5. Quarterly Growth Rates in Forecasted RGSP

  6. 2013 Sector Analysis Total Real GSP Growth 2.5 % Agriculture 22.7 0.8 0.0 Mining 1.2 3.7 TWU 4.3 3.2 Construction 1.9 9.1 Durables 0.7 10.7 Nondurables -0.5 5.0 Wholesale Trade 3.6 Retail Trade 1.8 5.8 Information 2.0 3.6 Percent of Total Real GSP 21.7 FIRE 2.9 B&P Services 4.1 10.6 E&H Services 4.9 7.3 3.2 H&L Services 2.1 Other Services 2.9 2.0 Government 1.7 13.3 Percent of Real Sector Growth

  7. 2013Year-End Employment Trends Total Employment Growth 1.6% Mining 0.0 0.1 TWU 3.8 3.1 Construction -2.2 4.1 5.8 Durables 0.4 Nondurables 0.2 5.1 11.5 Retail Trade 2.7 Wholesale Trade 1.1 4.3 64,500 Net Jobs 1.8 Information 7.6 5.0 FIRE 1.3 Percent of Total Employment B&P Services 4.1 13.8 E&H Services 1.4 13.8 L&H Services 2.1 10.6 3.5 Other Services 1.0 17.5 Government -0.1 Percent of Employment Growth

  8. 2013 North Carolina Unemployment Rate December Rate 6.9%

  9. Housing Stock/Prices Interest Rates Inflation Consumer Credit Consumer Confidence Dollar Gas Prices Budget Deficit Positive Indicators

  10. U.S. Monthly New Home Inventory (Seasonally Adjusted)

  11. Monthly Federal Funds Rate 1996-2013 Current Rate 0 - .25%

  12. Percentage Changes in CPI 1949-2013

  13. 1980-2013 U.S. Household Debt Payments as a Percent of Income Peak 2007 III 13.18% Current 9.93%

  14. Consumer Confidence • October 1992 54.6 • March 2009 25.0 • January 2014 81.7

  15. 2000-2013 Dollar Price of Euro $1.36 $0.87

  16. Monthly Gas Prices 2012-2014

  17. Effect of EnergyPrice Increase on U.S. Economy Annual Transportation Usage 187 billion gallons per year Annual Total Usage 288 billion gallons per year Effect of a $.50 increase in price Transportation $93.5 billion per year Total $144.0 billion per year

  18. 1980 – 2023 U.S. Budget Deficit 2013 Budget Deficit $672 billion 2015 Budget Deficit $388 billion

  19. Excess Reserves Trade Deficit Tax Increases Negative Indicators

  20. 2008 – 2014 Banking System Excess Reserves February Excess Reserves $2,517 billion

  21. 1992-2013 U.S. Trade Deficits 2009 Trade Deficit $382 Billion 2008 Trade Deficit $681 Billion 2013TradeDeficit $475 Billion 2006Trade Deficit $799 Billion

  22. Fiscal Year 2014 Original Sequestration $100 billion New Sequestration $50 billion Fiscal Year 2015 Original Sequestration $100 billion New Sequestration $75 billion Spending Cuts2014 - 2015

  23. North Carolina Forecast 2014

  24. Quarterly Growth Rates in Forecasted RGSP

  25. 2014 Sector Analysis Total Real GSP Growth 3.0 % Agriculture 11.9 0.9 0.0 Mining 1.9 3.7 TWU 3.4 3.2 Construction 4.2 9.1 Durables 2.9 10.7 Nondurables 2.5 5.0 Wholesale Trade 3.6 Retail Trade 2.4 5.8 Information 2.1 3.6 Percent of Total Real GSP 21.8 FIRE 3.3 B&P Services 1.8 10.5 E&H Services 2.2 7.2 3.1 H&L Services 1.7 Other Services 4.1 2.0 Government 3.8 13.4 Percent of Real Sector Growth

  26. 2014 Year-End Employment Trends Total Employment Growth 1.5% Mining -4.4 0.1 TWU 3.3 3.2 Construction 3.7 4.2 5.8 Durables 1.7 Nondurables 0.3 5.0 11.5 Retail Trade 1.8 Wholesale Trade 3.2 4.4 60,000 Net Jobs 1.8 Information 0.7 5.0 FIRE 0.1 Percent of Total Employment B&P Services 1.7 13.8 E&H Services 1.7 13.8 L&H Services 1.8 10.7 3.5 Other Services 2.3 17.2 Government 0.0 Percent Employment Growth

  27. 2013-2014 North Carolina Unemployment Rate December Rate 6.9%

  28. Employment Picture

  29. Employment Decline: -8,736,000 Employment Gain: 7,557,000 Percent Recovered: 86.5% 2007-2013 United States Payroll Employment

  30. Employment Decline: -334,600 Employment Gain: 243,900 Percent Recovered: 72.9% 2007-2013 North Carolina Payroll Employment

  31. What’s the Target?3,000,000 Jobs per Year250,000 Jobs per Month

  32. US Job Growth 20122,193,000 jobs182,750 per month(Second Largest Job Growth Since 1999)

  33. US Job Growth 20132,186,000 jobs182,150 per month(Third Largest Job Growth Since 1999)

  34. U.S. Job Growth 1990 - 2013

  35. NC Job Growth 1990 - 2013

  36. NC Job Growth 201289,900 jobs7,490 per month(Second Largest Job Growth Since 1998)

  37. NC Job Growth 201364,500 jobs5,375 per month(Sixth Largest Job Growth Since 1998)

  38. July 2013 Unemployment Rates

  39. December 2013 Unemployment Rates

  40. 2013 North Carolina Labor Force

  41. 2013 North Carolina Unemployment

  42. 2013 North Carolina Employment

  43. NC Number of Unemployed per Job Opening (Not Seasonally Adjusted) January 2008 1.21 Persons per Job Opening

  44. Regional Perspective

  45. MSA Jobs Gained

  46. MSA Jobs Percentage

  47. MSA Number of Unemployed

  48. MSA Number of Job Openings

  49. MSA Job Supply and Demand

  50. Housing in 2013

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