the 2014 economy: back to the future (or maybe back to the early 90’s) r. christopher jones, ph.d
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The 2014 Economy:Back to the Future (or maybe back to the early 90’s)
R. Christopher Jones, Ph.D.
2
What did 2013 offer us (the U.S.)?
An economy that is still growing.. Recession technically over June 2009
16 out of 17 quarters with positive real GDP growth since Q3 2009
Unemployment at lowest point in 5 years (7%) Retail sales growth relatively solid Growth in industrial production and capacity
utilization Interest rates still low, and we have avoided
inflation 29.2% growth in S&P 500
3
What else did it bring?
Not all the news was great.. We created 1.08 million jobs in 2013
Fewest net jobs created since 2010 Increasing Federal debt and expansive
monetary policy continue to spark fears of inflation
International debt crisis still threatens monetary and economic stability
Marginal growth in housing starts
4
What about Florida?
Growth has returned, but not “2000’s style” growth Best job growth in since 2005 (159k) Unemployment dropped 1.6 percent in 2013, to
lowest rate in 5 ½ years (6.2 percent) Housing starts are increasing (34% growth in
2013) Home values beginning to move upward All major regional markets seem to have
awakened from the economic coma
5
U.S. Real GDP 1950-2013 (Chained 2009 Dollars)
$1,000$2,000$3,000$4,000$5,000$6,000$7,000$8,000$9,000
$10,000$11,000$12,000$13,000$14,000$15,000$16,000
Q3
50
Q3
53
Q3
56
Q3
59
Q3
62
Q3
65
Q3
68
Q3
71
Q3
74
Q3
77
Q3
80
Q3
83
Q3
86
Q3
89
Q3
92
Q3
95
Q3
98
Q3
01
Q3
04
Q3
07
Q3
10
Q3
13
Bill
ion
s
6
U.S. Real GDP Annualized % Growth
1950-2013
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%Q
3 50
Q3
53
Q3
56
Q3
59
Q3
62
Q3
65
Q3
68
Q3
71
Q3
74
Q3
77
Q3
80
Q3
83
Q3
86
Q3
89
Q3
92
Q3
95
Q3
98
Q3
01
Q3
04
Q3
07
Q3
10
Q3
13
7
U.S. Unemployment Rate 1959-2013
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
%
8
U.S. Housing Starts (SAAR) 1960-2013
400600800
1,0001,2001,4001,6001,8002,0002,2002,4002,600
000'
s
9
Real Retail & Food Svcs. Sales 1992-2013
$115$120$125$130$135$140$145$150$155$160$165$170$175$180$185$190
Bill
ion
s
10
Inflation (CPI-U) 1970-2013
30.0
70.0
110.0
150.0
190.0
230.0
11
Real Per Capita Disposable Personal Income 1960-2013
$8,000$10,000$12,000$14,000$16,000$18,000$20,000$22,000$24,000$26,000$28,000$30,000$32,000$34,000$36,000$38,000
Ma
y-6
0
Ma
r-6
2
Ja
n-6
4
No
v-6
5
Se
p-6
7
Ju
l-6
9
Ma
y-7
1
Ma
r-7
3
Ja
n-7
5
No
v-7
6
Se
p-7
8
Ju
l-8
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Ma
y-8
2
Ma
r-8
4
Ja
n-8
6
No
v-8
7
Se
p-8
9
Ju
l-9
1
Ma
y-9
3
Ma
r-9
5
Ja
n-9
7
No
v-9
8
Se
p-0
0
Ju
l-0
2
Ma
y-0
4
Ma
r-0
6
Ja
n-0
8
No
v-0
9
Se
p-1
1
Ju
l-1
3
12
Credit Market Debt Per Capita 1961-2013 (infl. adj.)
$5,000$10,000
$15,000$20,000
$25,000$30,000
$35,000$40,000
$45,000$50,000
13
Consumer Sentiment 1980-2013
50.060.070.080.090.0
100.0110.0120.0
14
Federal Debt 1971-2013
$0$2,000$4,000$6,000$8,000
$10,000$12,000$14,000$16,000$18,000
Bill
ion
s
Domestic Foreign
15
2014 U.S. Forecast Growth continues, real GDP will grow by 3% -
3.25% Modest job growth continues, unemployment
finish out the year around 5.3% - 5.5% Stock markets grow by 7% - 10% Inflation concerns still can’t be ignored, nor can
the international debt crisis Is there a “boom” period ahead in the short
run? Not likely – but probably no collapse, either
16
Florida: The Facts
Florida has added 623,100 jobs since July 2010 Represents 11.9 percent of all U.S. jobs created during
this period The net job gains (623.1k) represent two-thirds of the
job losses experienced during the recession (930,800) Dec. 2012 – Nov. 2013: Gained 159,400 jobs 6.2% unemployment (Nov. 2013) 52,081 housing starts first 11 mos. of 2013, compared
to 38,758 in 2012 and 29,324 in 2011 Home prices have increased by 8.4 percent in the past
year
1717
Florida Real GDP(millions of chained 2005 dollars)1997-2012
$470,000
$520,000
$570,000
$620,000
$670,000
$720,000
1818
Florida Employment (000s)1990-2013
5,0005,5006,0006,5007,0007,5008,0008,5009,000
1919
Florida Unemployment Rate 1982-2013
2.03.04.05.06.07.08.09.010.011.012.0
%
2020
Florida Housing Starts1988-2013
02,0004,0006,0008,00010,00012,00014,00016,00018,00020,00022,000
2121
Florida Home Price Index (Q1 1980 = 100)1988-2013
100150200250300350400450500
2222
Florida Home Ownership Rate1984-2012
63
65
67
69
71
73
%
2323
Leading Index for Florida1988-2013
S1-6.0
-4.0
-2.0
0.0
2.0
4.0
6.0
2424
FL Employment By Region 1990-2013 (000s)
250
500
750
1,000
1,250
1,500
1,750
2,000
2,250
2,500
M i ami
Or l ando
T ampa
J ax
2525
FL Unemployment Rate by Region1990-2013
2.03.04.05.06.07.08.09.010.011.012.013.0
Miami
Orlando
Tampa
J ax
5
2626
FL Housing Starts By Region1990-2013
0
400
800
1, 200
1, 600
2, 000
2, 400
2, 800
3, 200
3, 600
4, 000
4, 400
Miami
Orlando
Tampa
J ax
2727
FL Consumer Distress Index by Region (Financial Distress < 70)
2005-2013
56
61
6671
76
81
86
Miami
Orlando
Tampa
J ax
28
What’s in Store for Florida? More job growth, lower unemployment
But the growth will be modest Florida’s economic picture today looks a lot like the
early 1990’s Are we ever going to see a full recovery of the
housing sector? Depends on how you define “full recovery” If you use 2000’s criteria, no
All areas are moving forward again SE Florida will create the most jobs (most diverse
economy)
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