regional economic outlook - seattle economics council › uploads › 1 › 0 › 8 › 1 ›...
TRANSCRIPT
Spencer Cohen, PhDSenior EconomistApril 4, 2018
Regional Economic Outlook
About Community Attributes Inc.
April 4, 2018 Seattle Economics Council 2
RegionalEconomics
Land UseEconomics
Community &Economic
Development
Data Dashboards &Business Intelligence
InformationDesign
Surveys &Market
Research
Outline• Current economic conditions
• Jobs: aerospace and non-aerospace trends• Population trends• Income, wealth, occupations
• Global and national economic trends and outlook• Regional jobs and population short-term forecast
April 4, 2018 Seattle Economics Council 3
Forecasts are Never RightJust Less or More Wrong“The only function of economicforecasting is to make astrologylook respectable.”
- John Kenneth Galbraith“Forecasting is very difficult,especially when it involves thefuture.”
- Yogi Berra“Weather forecast for tonight:dark.”
- George CarlinApril 4, 2018 Seattle Economics Council 4
Circular Flow Economy
April 4, 2018 Seattle Economics Council 5
Regional Current Conditions
April 4, 2018 Seattle Economics Council 6
7
Major Industries in Washington 4,326,400 Total Jobs
Sources: Bellevue Creative Economy Study, 2017; QCEW, 2017; Washington State Employment Security Department, 2017; QCEW, Bureau of Labor Statistics, 2017;Industry/Occupation Crosswalk, Washington State Employment Security Department, 2017; Bureau of Economic Analysis, 2017
8
Major Industries in Washington Percent of Export Jobs by Industry
Sources: Bellevue Creative Economy Study, 2017; QCEW, 2017; Washington State Employment Security Department, 2017; QCEW, Bureau of Labor Statistics, 2017;Industry/Occupation Crosswalk, Washington State Employment Security Department, 2017; Bureau of Economic Analysis, 2017
9
Creative Economy of King County
Sources: Bellevue Creative Economy Study, 2017; QCEW, 2017; Washington State Employment Security Department, 2017; QCEW, Bureau of Labor Statistics, 2017;Industry/Occupation Crosswalk, Washington State Employment Security Department, 2017; Bureau of Economic Analysis, 2017
120,400 Total Creative Economy Jobs
King County Employment by Establishment Size2017
Seattle Economics Council 10April 4, 2018
Non-farm EmploymentSeattle MSA, annual growth rate
April 4, 2018 Seattle Economics Council 11
Seattle MSA figures areseasonally adjusted.Sources: Washington StateEmployment SecurityDepartment, 2018;Community Attributes Inc.,2018.
Employment by Industry, 2017Seattle MSA, Jobs in 2017 and 2017 growth rate (%)
April 4, 2018 Seattle Economics Council 12
Sources: Washington State Employment Security Department, 2018; Community Attributes Inc., 2018.
Excludingaerospace, jobgrowth increased3.3% in 2017.
Aerospace EmploymentSeattle MSA, annual growth rate
April 4, 2018 Seattle Economics Council 13
Seattle MSA figures areseasonally adjusted.Sources: Washington StateEmployment SecurityDepartment, 2018;Community Attributes Inc.,2018.
Four straight years ofdeclining employment.
April 4, 2018 Seattle Economics Council 14
Boeing EmploymentWashington and U.S., 2010-2017
*2017 figures are estimates based on dataavailable through September 2017.Sources: The Boeing Company, 2017;Community Attributes Inc., 2018.
Aerospace Revenue/WorkerStatewide, 2017 $
April 4, 2018 Seattle Economics Council 15
Sources: U.S. Bureau of Labor Statistics, 2018; Washington State Department of Revenue, 2018; St. Louis FRED, 2018;Community Attributes Inc., 2018.
Revenue/worker aproxy forproductivity.Between 2011 and2014, revenue perworker increased54%, but has sinceleveled off.
Unemployment RateU.S., Washington state, Seattle MSA, 2000-2018, 3mma
April 4, 2018 Seattle Economics Council 16
Rates seasonally adjustedand based on three-monthmoving average (3mma).Sources: Sources:Washington StateEmployment SecurityDepartment, 2018; St. LouisFRED, 2018; CommunityAttributes Inc., 2018.
Wages & Incomes (Seattle-Bellevue-Everett)
10th Percentile (0.1% CAGR)
25th Percentile (0.0% CAGR)
50th Percentile (0.2% CAGR)
75th Percentile (0.7% CAGR)
90th Percentile (1.1% CAGR)
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Seattle Economics Council 17Sources: Bureau of Labor Statistics, OES, 2018.
2017 $
April 4, 2018
Personal Income, 2006-2017Per capita, 2017 $, Seattle-Tacoma-Bellevue MSA
April 4, 2018 Seattle Economics Council 18
*Estimate.Sources: U.S. Bureau ofEconomic Analysis, 2017;U.S. Bureau of LaborStatistics, 2018; St. LouisFRED, 2018; CommunityAttributes Inc., 2018.
Taxable Retail SalesKing County, billions 2017 $
April 4, 2018 Seattle Economics Council 19
*2017 estimates based on firsttwo quarters and net changeover same period in 2016.
Sources: Washington StateDepartment of Revenue, 2018;St. Louis FRED, 2018;Community Attributes Inc.,2018.
Seattle Economics Council 20
Total Washington Exports by Commodity or Merchandise, 2017
Source: U.S. Census Bureau, 2018.April 4, 2018
21
Washington Aerospace Exports2017
Seattle Economics CouncilApril 4, 2018
Seattle Economics Council 22
Washington Non-Aerospace Exports2017
Source: U.S. Census Bureau, 2018.April 4, 2018
Regional Population GrowthCumulative population growth since 1975
April 4, 2018 Seattle Economics Council 23
Sources: Washington StateOffice of FinancialManagement, 2017; ConwayPedersen Economics, 2017.
Jobs and PeopleChange in Jobs & Net Migration, Central Puget Sound Region
Seattle Economics Council 24
Source: Office of Financial Management, 2018.
April 4, 2018
25
Migrations to King CountyBy Origin of Newly Issued King County Driver’s Licenses, 2017
CaliforniaOregon
Texas
South(less TX)
Midwest
East Coast
MountainPacific
(No CA or OR)
International
Source: DOL WA 2018
April 4, 2018 Seattle Economics Council
Origin of Newly Issued King County Driver's Licenses
2,108
3,404
2,992
2,313
3,197
2,344
3,379
2,952
3,896
2,990
4,487
3,554
4,711
3,260
4,883
0
1,000
2,000
3,000
4,000
5,000
6,000
Q12010
Q22010
Q32010
Q42010
Q12011
Q22011
Q32011
Q42011
Q12012
Q22012
Q32012
Q42012
Q12013
Q22013
Q32013
Q42013
Q12014
Q22014
Q32014
Q42014
Q12015
Q22015
Q32015
Q42015
Q12016
Q22016
Q32016
Q42016
Q12017
Q22017
Q32017
Q42017
California
Oregon
Texas
Pacific (No CA or OR)
South (No TX)
Mountain
East Coast
Midwest
International
Source: DOL WA 2018
Seattle Economics Council 26April 4, 2018
Global and U.S. Economic Trendsand Forecast
April 4, 2018 Seattle Economics Council 27
Global Economic TrendsReal GDP, year-over-year growth (%)
April 4, 2018 Seattle Economics Council 28Sources: IMF World Economic Outlook,October 2017 and January 2018.
Forecast
The IMF recently increased itsprojection for global GDP by 0.1percentage points.
Total Trade VolumeGoods and services, annual % change
April 4, 2018 Seattle Economics Council 29Sources: IMF World Economic Outlook,October 2017 and January 2018.
Forecast
Assumes stability inglobal trade regime,which could beundermined in 2018.
U.S. Economic RecoveryMonths of expansion following recession, NBER definition
April 4, 2018 Seattle Economics Council 30
*2008-2009 expansion period still ongoing.Sources: National Bureau of Economic Research, 2018; Community Attributes Inc., 2018.
Recession Period Recovery/ Expansion Period
1990-1991 1991-2001
1960-1961 1961-1970
2008-2009 2009-?
1981-1982 1982-1990
1937-1938 1938-1945
2001 2001-2008
1973-1975 1975-1980
1929-1933 1933-1937
1860-1862 1862-1866
1948-1949 1949-1953
Months of Recovery/Expansion
U.S. Real Gross Domestic ProductHistoric and Forecast, 2000-2022
April 4, 2018 Seattle Economics Council 31
Sources: St. Louis FRED,2018; Blue Chip EconomicIndicators, 2018 (for years2018-2019); InternationalMonetary Fund WorldEconomic Outlook, 2018(for years 2020-2022).
Forecast
Key Stories and Factors to Watch• China’s continued macroeconomic restructuring
and local debt reconciliation.• Tariffs and escalation of trade friction, risk of trade
war.• Geopolitical issues—Korean Peninsula, sustained
recovery in Europe, Russia.• National factors—impact of tax cuts, Feb interest
rate hikes, Trump Administration trade policies.• Regional—sustained growth in Seattle and
Washington state economies, vibrancy of techeconomy, affordability.
April 4, 2018 Seattle Economics Council 32
Seattle Regional Outlook
33April 4, 2018 Seattle Economics Council
What Could Go Wrong?
April 4, 2018 Seattle Economics Council 34
What to Watch for
April 4, 2018 Seattle Economics Council 35
Factor Effect DescriptionExpected reversal in Boeing employment Positive • Voluntary layoffs past five years to end;
Boeing to resume hiring.• Backlog of more than 5,800 aircraft, of
which 1/5 final assembly in SnohomishCounty.
• ~Half all state aerospace jobs in Snohomish.Foreign market opportunities Stable/
UncertainRegion's leading export markets to remainclose to current growth levels for 2018 and2019.But will the U.S. get embroiled in a trade warwith China?
Overall U.S. growth Stable Blue Chip projects 2.7% and 2.4% in real GDP in2018 and 2019.
Sustained statewide growth Positive Washington State ERFC projects 2018 and 2019growth in real GDP of 2.8% and 3.6%.
Seattle MSA growth Positive Growth in Seattle expected to sustain in 2018.
Merchandise and Commodities: Washington ExportsNon Aerospace, 2002-2022
36
Historical Forecast
Sources: U.S. Census Bureau, 2018; International Monetary Fund, 2017 and 2018; Blue Chip Economic Indicators, 2018; Community Attributes Inc., 2018
Leading Regional Export Markets
April 4, 2018 Seattle Economics Council 37
*GDP growth based on constant prices in national currency.Sources: Blue Chip Economic Indicators, 2018; International Monetary Fund World Economic Outlook, October 2017; U.S. CensusBureau, 2018.
2018 2019 2020-2022
China $9.3 6.8% 6.3% 6.1% 5.9% Blue Chip for 2018 and 2019, IMF for 2020-2022Canada $3.2 3.0% 2.2% 1.9% 1.8% Blue Chip for 2018 and 2019, IMF for 2020-2022United Arab Emirates $3.1 1.3% 3.4% 3.4% 3.1% IMFJapan $2.0 1.5% 1.4% 1.1% 0.7% Blue Chip for 2018 and 2019, IMF for 2020-2022Norway $1.9 1.4% 1.6% 1.6% 1.8% IMFSaudi Arabia $1.7 0.1% 1.1% 1.1% 2.0% IMFRussia $1.5 1.8% 1.9% 1.7% 1.5% Blue Chip for 2018 and 2019, IMF for 2020-2022I reland $1.5 4.1% 3.4% 3.4% 2.8% IMFTaiwan $1.4 2.0% 2.4% 2.3% 2.3% Blue Chip for 2018 and 2019, IMF for 2020-2022United Kingdom $1.1 1.7% 1.4% 1.3% 1.7% Blue Chip for 2018 and 2019, IMF for 2020-2022
All Other Countries/Markets $15.6
Global $42.2
SourcesForeign MarketEstimated King County& Snohomish CountyExports 2017 (bils $)
GDP Growth, 2017Forecast Annual Growth (%)
Boeing BacklogAs of January 2018, ranked by final assembly orders
April 4, 2018 Seattle Economics Council 38
*Backlog defined as unfilled orders.Some 787 orders will bemanufactured in South Carolina.Source: The Boeing Company, 2018.
Country/Market Total Backlog 737 747 767 777 787United Arab Emirates 485 245 0 0 188 52Qatar 101 0 0 0 71 30Singapore 193 116 0 0 20 57Japan 70 11 0 0 26 33I reland 438 402 0 0 0 36China 304 275 0 0 6 23Russian Federation 58 30 0 0 6 22United Kingdom 107 84 0 0 0 23Taiwan 22 0 0 0 4 18France 26 5 0 0 0 21
All other markets 4,027 3,480 11 97 104 335
Total 5,831 4,648 11 97 425 650
Net Job GainsSeattle MSA, historic and forecast
April 4, 2018 Seattle Economics Council 39
Sources:Washington StateEmploymentSecurityDepartment, 2018;CommunityAttributes Inc., 2018.
Annual GrowthSeattle MSA, historic and forecast
April 4, 2018 Seattle Economics Council 40
Sources: WashingtonState EmploymentSecurity Department,2018; CommunityAttributes Inc., 2018.
Forecast
Jobs by Industry (Seattle-Bellevue-Everett)
41Sources: Bureau of Labor Statistics; Washington State Employment Security Department, 2001-2023
42
Jobs by Occupations (Seattle-Bellevue-Everett)
Sources: Washington State Employment Security Department; Bureau of Labor Statistics; 2012-2023
Split into two and enlarge
Seattle Economics Council 43
Population Growth & Housing Unit Change
0
5,000
10,000
15,000
20,000
25,000
00-01 02-03 04-05 06-07 08-09 10-11 12-13 14-15 16-17
Change Over PreviousYear
Sources: Washington State OFM, 2017
Households Housing Units
King County Annual Households & Housing UnitChange, 2000-2017
April 4, 2018
44
Planned Office Projects, Seattle and Bellevue
Sources: CB Richard Ellis, 2018; Community Attributes Inc, 2018
April 4, 2018 Seattle Economics Council