DBIA-MAR Luncheon
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DBIA-MAR Luncheon February 19, 2013 The U.S. and Washington Area Economies’ Current Economic Performance and Near-Term Outlook Stephen S. Fuller, Ph.D. Dwight Schar Faculty Chair and University Professor Director, Center for Regional Analysis George Mason University
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DBIA-MAR Luncheon. The U.S. and Washington Area Economies’ Current Economic Performance and Near-Term Outlook . Stephen S. Fuller, Ph.D. Dwight Schar Faculty Chair and University Professor Director, Center for Regional Analysis George Mason University. February 19, 2013. - PowerPoint PPT Presentation
Transcript of DBIA-MAR Luncheon
DBIA-MAR Luncheon
February 19, 2013
The U.S. and Washington Area Economies’ Current Economic
Performance and Near-Term Outlook
Stephen S. Fuller, Ph.D.Dwight Schar Faculty Chair and University Professor
Director, Center for Regional AnalysisGeorge Mason University
Quarters After Trough
% C
hang
e in
GD
P
Recession Recovery Patterns of GDPPast Four Recessions
Sources: Bureau of Economic Analysis, GMU Center for Regional Analysis
Components of Post Recession RecoveriesAverage Growth After 14 Quarters
Source: Bureau of Economic Analysis
Avg % Chg
Decreasing Role of Residential Investment% of GDP 14 Quarters Post-Recession
Source: Bureau of Economic Analysis
The Contribution of Housing toGross Domestic Product (GDP)
Source: U.S. Bureau of Economic Analysis, NIPA tables, Table 1.5.5 Gross Domestic Product, Expanded Detail
Furnishings & household equip 3%
ISM Manufacturing and Non-Manufacturing Indices
Source: Institute for Supply Management
Annual Change in Payroll Jobs – USMonth-Over-Year
(000s)
Dec =+ 1.86 M
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
U.S. Payroll Job Change by SectorDec 2011 – Dec 2012
(000s) Total = 1,835Ranked by Size in 2011
Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis
Source: Department of Labor
Initial Claims for Unemployment 2011-Present 4-Week Moving Average
Jan 26352
(000s)
Consumer Prices2001 - 2017
Forecast > > > > >
%
Source: Bureau of Labor Statistics, IHS Global Insight Jan. 7, 2013
Interest Rates2005 - 2017
Forecast > > > > >
%
Source: IHS Global Insight Jan. 7, 2013
Existing (Left Axis)
New (Right Axis)
U.S. New and Existing Home Sales
(000s) (000s)
Source: National Association of Home Builders (New), National Association of Realtors (Existing)
Housing Forecast(millions of Units)
Year Housing Starts Existing House Sales2005 2.073 7.0762011 0.612 4.2832012 0.774 4.6952013 0.970 5.0622014 1.281 5.606
2015 1.612 5.990
2016 1.669 5.8992017 1.666 5.728
Source: IHS Global Insight “US Executive Summary” January 7, 2013
U.S. Gross Domestic ProductQuarterly Change: 2007 – 2014
% Forecast > > > > >
Source: Bureau of Economic Analysis, Global Insight Jan 7 2013
%
U.S. Economic Performance
Source: Bureau of Economic Analysis, Global Insight Jan. 7 2013
How did the recession change the
Washington Area economy?
US GDP and Washington GRP %
Washington GRP
US GDP
Wash MSA Payroll Job Change: Private Sector The Great Recession and Recovery To December 2012
(000s)
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Total -193 Total 132
Washington Area Job Changes By Sector, 2008-2012 (through Dec)
(in thousands)
SECTOR Washington Metro Area
D.C. Suburban MD
Northern Virginia
Professional, Business Services 39.2 1.0 6.6 31.6
Government 59.3 12.4 19.2 27.7Health, Educ. Svcs. 60.8 23.8 13.7 23.3Other Services 7.2 7.4 -0.7 0.5Hospitality 26.1 8.1 6.1 11.9All Other -64.8 -4.5 -36.6 -23.7 TOTAL 127.8 48.2 8.3 71.3
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
How is the Washington Area’s economy currently performing?
Annual Job ChangeWashington MSA, 2002-2012
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
16 Large Job MarketsJob Change: Dec 2011 – Dec 2012
(000s)
Washington + 30,200
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorDec 2011 – Dec 2012
Washington MSA(000s) Total = 30,200
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorNov 2012 – Dec 2012
Washington MSA(000s) Total = -1,300
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Annual Job ChangeDistrict of Columbia, 2002-2012
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorDec 2011 – Dec 2012 District of Columbia
(000s) Total 1,400
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Annual Job ChangeSuburban Maryland, 2002-2012
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorDec 2011 – Dec 2012Suburban Maryland
(000s) Total 12,600
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Annual Job ChangeNorthern Virginia, 2002-2012
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorDec 2011 – Dec 2012
Northern Virginia(000s) Total 20,600
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
8.6 – DC7.8 – U.S.
5.7 – SMD5.2 – MSA4.1 - NVA
Unemployment Rates in the WMSABy Sub-State Area, 2005-2012
Source: US Bureau of Labor Statistics (Region - Not Seasonally Adjusted, US – Seasonally Adjusted)
Key Conditions Shaping the Future
Washington Area Economy:
Declining Federal SpendingWage and Salary Compression
Population Change
Federal Procurement in theWashington Metro Area, 1980-2012
$ Billions
| < 80-90 = $96.5 B > | < 91-00 = $207.9 B >| < 01–10 = $563.5 B > |
TOTAL = $1,023.5 Billion
Source: US Census, Consolidated Federal Funds Report
2011
$80.0 B$75.6 B
2012
Federal GovernmentWashington MSA
(000s) Annual Data Annual Month over Year
2008 2009 2010 2011 2012
Source: U.S. Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Summary for Federal Spending Trends in the Washington Metropolitan Area, 2010-2012
• Federal Procurement Outlays declined 8.4% between FY 2010 and FY 2012.
• Federal employment has declined since peaking in July 2010, losing 8,700 jobs or 2.25%.
• Federal payroll declined by 0.6% between FY 2010 and FY 2011 and will continue to decline as the workforce shrinks and older workers retire and are replaced by younger workers.
Changing Job and Income PatternsIn the Washington Metropolitan Area
Source: US Bureau of Labor Statistics, GMU Center for Regional Analysis
$$$$ $$ $$ $$ $$ $$ $$ $2011 Avg.
Annual Pay
$92.2K
$50.7K
Early Signs of Income CompressionWashington MSA
Source: US Bureau of Economic Analysis, GMU Center for Regional Analysis
(in thousands) (in thousands, 2011 dollars)
Jobs
Earnings P
er Em
ployee
The Washington Metropolitan AreaPopulation Is Aging
(percent share, total population in millions) Age Group 2012 2017 2029 Change
Less than 25 years 32.7% 32.0% 31.5% 17.2%
25 to 44 years old 30.2 30.0 29.5 19.5%
45 to 64 years old 26.6 25.3 23.3 6.8%
65 years old + 10.5% 12.7% 15.7% 82.4%
Totals 5.810 6.213 7.087 22.0%
Source: IHS Global Insight, GMU Center for Regional Analysis
2012-2017 Forecast for the Washington Metropolitan Area
Indicator 2012 2017 Change
GRP Growth $450.9 $571.8 26.8%
Net Job Growth 3,915.3 4,271.5 356.29.1%
Replacement Job Growth 459.1 11.7%
Household Growth 2,135.38 2,285.27 149.89
7.0%
GRP, Job and Workforce Growth in theWashington Metropolitan Area, 2012 – 2017
(in billions of current $s, jobs in thousands)
Job Growth in the Washington AreaBy Sector, 2012-2017 (in thousands)
Sector 2012 2017 Change PercentProf. & Bus. Ser. 697.4 841.2 143.8 20.6Federal Gov’t 380.4 358.4 - 22.0 - 5.8Education/Health 380.2 419.0 38.8 10.2S & L Gov’t 309.7 321.6 11.9 3.8Hospitality 276.8 285.0 8.2 3.0Retail Trade 254.1 266.6 12.5 4.9Other Services 182.8 185.3 2.5 1.4Financial Services 150.0 154.7 4.7 3.1Construction 146.4 201.8 55.4 37.8Information Ser. 80.6 87.6 7.0 8.7Other Sectors (3) 175.0 193.2 18.2 10.4Total Jobs 3,033.4 3,314.4 281.0 9.3
Major Sources of Job Growth in theWashington Area , 2012-2017 (in thousands)
Growth Sectors 2012 2017 Change PercentProf. & Bus. Ser. 697.4 841.2 143.8 20.6Education/Health 380.2 419.0 38.8 10.2Construction 146.4 201.8 55.4 37.8Sub-Totals 1,224.0 1,462.0 238.0 19.4 % Total 40.4 44.1 84.7_________Totals 3,033.4 3,314.4 281.0 9.3
Sources: IHS Global Insight; GMU Center for Regional Analysis
GRP Per Job in the Washington Area By Sector (in 2005 dollars)
Sector 2012 2017 % ChangeProf. & Bus. Services $134,750 $154,656 14.8%Federal Gov’t 138,361 138,566 0.1Education/Health 59,730 57,508 - 3.7S & L Gov’t 60,975 56,920 - 6.6Hospitality 42,883 42,391 - 1.1Retail Trade 60,807 64,136 5.5Other Services 70,339 69,151 - 1.7Financial Services 543,482 578,062 6.4Construction 98,824 82,490 - 16.5Information Services 349,868 468,376 33.9Other Sectors 147,903 151,120 2.2GRP per Job $130,653 $138,881 6.3
GRP Per Job in the Washington Area By Sector (in 2005 dollars)
High Job Growth 2012 2017 % ChangeProf. & Bus. Svs. (20.6%) $134,750 $154,656 14.8Education/Health (10.2%) 59,730 57,508 - 3.7Construction (37.8%) 98,824 82,490 - 16.5
Other High Value-Added SectorsInformation Services (8.7%) 349,868 468,376 33.9Financial Services (3.1%) 543,482 578,062 6.4Federal (-5.8%) 138,361 138,566 0.1Wholesale Trade (8.9%) 183,006 191,884 4.8Transport/Warehsg (16.1%) 138,768 135,938 - 2.0GRP per Job $130,653 $138,881 6.3
2017 Structure of the Greater Washington Economy
Local ServingActivities 38.0%
Non-LocalBusiness 16.3 %
TotalFederal 28.8%
Procurement 12.2%
Assn 1.9 %
Hosp. 2.6%
Int’l 3.9%
Other 1.5%
Other Federal 8.9 %
Health/Ed.
7.0 %
Fed Wages & Salaries 7.7 %
Source: GMU Center for Regional Analysis
The Changing Structure of the Washington Area Economy, 2010-2040
Source: IHS Global Insight, GMU Center for Regional Analysis
(percent distribution)
Thank You Questions
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