Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast...
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Transcript of Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast...
![Page 1: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/1.jpg)
Arizona (and the West) Shall Rise Again – Just you Wait!
48th ASU/Chase Economic Forecast
![Page 2: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/2.jpg)
• Getting Better? Or Worse?
• Arizona Adding Jobs - Slowly
• Full Recovery is Years Away
• Long Term Outlook is Positive
Arizona Update & OutlookArizona Update & Outlook
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How Long Is “Long Term?”
Arizona Full Recovery
3-4-5 Years?
![Page 4: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/4.jpg)
71% say economy is “getting worse” Gallup PollNovember 26, 2011
56% “getting worse” November 26, 2010
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29% say U.S. economy is now “in a depression”
But..real GDP has recovered to prior peak
before start of the recession
2006 2007 2008 2009 2010 2011
Gross Domestic Product ($2005)
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“…mania of pessimism”- John Paulson
Objective Approach“What are the numbers?”
Modern Approach“How do you feel
about the numbers?”
![Page 7: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/7.jpg)
Unemployment
& Weak Job Growth
Reduce ConfidenceIncrease Pessimism
![Page 8: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/8.jpg)
Meanwhile…
Year-over-Year Arizona Job Growth Is (Slowly) Improving
![Page 9: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/9.jpg)
Indicator 2011 2010Labor Force 3,171,000 3,179,000
Unemployed 282,000 307,000
Unemp. Rate 9.0% 9.8%
Jobs–12 Mos 44,700 -15,000
Arizona Labor Market ImprovesCompare October 2011 vs October 2010
W. P. Carey School of Business & U. S. Bureau Labor Statistics
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( Percentage Change 2010 vs 2009)
41 States Lost Jobs in 2010
Alaska 3
6
Hawaii
5
2
Lost Jobs (41)
Added Jobs (9)
9
49
444
48
40
17
3850
42
28
78
1
25
43
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(Ranked by Percent Change Oct. 2011 vs Oct. 2010)
45 States Now Adding Jobs
5
3
1
4Losing Jobs (5)
Adding Jobs
6
7
10
2
9
13
32
8
1521
36
14
![Page 12: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/12.jpg)
Az Industry Rank New JobsOverall Az Jobs #7 44,700
Health Care #3 14,100
Construction #3 4,600
Trans./Warehouse
#4 4,100
Manufacturing #9 4,700
Arizona Growth RankingsStates Ranking by Percent Growth: Oct. 2011 vs Oct. 2010
W. P. Carey School of Business & U. S. Bureau Labor Statistics
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Arizona Jobs Still Down by 300,000And At Same Level as 2004
Peak 2.7 mil
2.4 mil
2004 2005 2006 2007 2008 2009 2010 2011
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Metro Area Percent Job GainsHouston 3.1% 79,500
Seattle 2.3% 37,700
Tampa 2.2% 24,100
San Diego 2.0% 24,000
Boston 1.9% 47,000
Pittsburgh 1.9% 21,800
Phoenix 1.8% 29,900
Best Metro Job Growth 2011Job Gains – Oct. 2011 vs Oct. 2010 – Labor Force > 1 Million
W. P. Carey School of Business & U. S. Bureau Labor Statistics
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Realistically…
Full Recovery isYears Away
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U.S. Full Job Recovery Will Take Years
2001 Recession
1990 Recession
Current Employment
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After four years, Arizona jobs are still10% below 2007 peak
4 More Years For Az Jobs Recovery
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Assume: 2.5% job growth starting in 2012- back to peak in 2015
96 Months/8 Years To Return to Peak
4 More Years For Az Jobs Recovery
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Economic Outlook:
Slow(very slow)
Growth
![Page 20: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/20.jpg)
2010 2011 2012Personal Income (%) 2.9 5.5 6.0
Employment (%) -2.1 1.0 1.8
Retail Sales (%) -1.7 7.5 8.0
Population (%) 1.1 1.2 1.5
ARIZONA Economic Forecast
W. P. Carey School of Business, ASU; based on data available as of Dec. 1, 2011
Major Arizona Risk – U.S. Economy
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31,200
85,000
127,700 126,300
39,800
-57,300
-190,300
-51,900
24,00045,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Arizona Jobs Growing AgainAnnual Numeric Change In Arizona Employment
YTD Az Job Growth 0.8% Thru Oct.
ForecastU.S. BLS & W. P. Carey School of Business
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Annual Percent Change
Arizona Dept. of Revenue & W. P. Carey School of Business
Arizona Retail Sales Outlook:Consumers Still Cautious
Forecast
![Page 23: Arizona (and the West) Shall Rise Again – Just you Wait! 48 th ASU/Chase Economic Forecast Lee.mcpheters@asu.edu.](https://reader036.fdocuments.net/reader036/viewer/2022081516/5513d74b5503466f748b4fc7/html5/thumbnails/23.jpg)
U.S. Census Bureau & W. P. Carey School of Business Forecast
Population Growth BelowAverage – For Arizona
(Annual Percent Change)
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2005 - 2007 2008 - 2010
U. S. Census Bureau and W. P. Carey School of Business
Annual Average Migration toArizona Slowed In Recession
97,492
42,553
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Long Term Arizona Population Growth Projections Still Strong
Thousands of New Residents Per Year
U. S. Census Bureau and IHS Global Insight
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Percent Families That Can Afford Median Priced Home
National Association of Home Builders
Silver Lining: Phoenix Housing Again More Affordable Than U.S.
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Short Term Outlook Weak
Plan Now For ArizonaLong Term Recovery
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(Ranked by Percent Change 2011 – 2015 Job Growth)
Arizona Top Growth State: 2015
6
2
1
73 10
4
9
5
8
17
11
12
13
14
15
16
19
20
18
Source: IHS Global Insight
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• Educated work force
• Competitive tax structure
• Affordable energy, water, land
• Transportation infrastructure
• Strong national/global brand
Quality Growth Depends on More Than Population
Increases
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The Paradox of Recovery
RECESSION AND RECOVERYRecession Cause Recession Cure
Too Much Confidence More Confidence
Too Much Credit More Credit
Too Much Spending More Spending