tennessee economic outlook professor matthew n. murray ut center for business and economic research...
TRANSCRIPT
Tennessee Economic Outlook
Professor Matthew N. MurrayUT Center for Business and Economic Research
March 29, 2010
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 2
Source: IHS Global Insight, Inc.
Real GDP: 2005 to 2012
11,500
12,000
12,500
13,000
13,500
14,000
14,500
15,000
05.1 06.1 07.1 08.1 09.1 10.1 11.1 12.1
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
Real GDP
Growth
Le
vel,
bill
ion
s o
f ch
ain
ed
20
05
do
llars
Pe
rcen
tag
e ch
an
ge
, sam
e q
ua
rter la
st yea
r
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 3
Source: CBER-UT, An Economic Report to the Governor of the State of Tennessee: 2010.
Tennessee Real GDP: 2005 to 2012
180,000
190,000
200,000
210,000
220,000
230,000
240,000
250,000
05.1 06.1 07.1 08.1 09.1 10.1 11.1 12.1
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
Real GDP
Growth
Le
vel,
mill
ion
s o
f 20
00
do
llars
Pe
rcen
tag
e ch
an
ge
, sam
e q
ua
rter la
st yea
r
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 4
Growth in Personal Income, Tennessee and the U.S. : 2005 to 2013
-4.00
-2.00
0.00
2.00
4.00
6.00
8.00
10.00
2005.1 2006.1 2007.1 2008.1 2009.1 2010.1 2011.1 2012.1 2013.1
TN U.S.
perc
enta
ge c
hang
e, s
ame
qtr
last
yr
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 5
Source: Bureau of Labor Statistics.
Tennessee Nonfarm Employment:January 2008 to January 2010
-25.0
-20.0
-15.0
-10.0
-5.0
0.0
5.0
10.0
Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10
M
on
thly
ch
an
ge
(th
ou
san
ds)
(seasonally adjusted)
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 6
2550.0
2600.0
2650.0
2700.0
2750.0
2800.0
2850.0
2006.1 2007.1 2008.1 2009.1 2010.1 2011.1 2012.1
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
LevelGrowth
Em
ploy
men
t (t
hous
ands
)
Percentage change, sam
e quarter last year
Source: Bureau of Labor Statistics and CBER-UT.
(seasonally adjusted)
Tennessee Nonfarm Employment:2006 to 2012
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 7
1999 2009 2019 1999 to 2009 2009 to 2019
Total Nonfarm………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..2684.0 2664.8 2938.0 -0.1 1.0Natura l Resources , Mining & Construction………………………………………………………………………………………………………………………………………………….128.3 107.4 112.1 -1.8 0.4Manufacturing…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………499.8 322.4 301.9 -4.3 -0.7
Durable Goods………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….304.5 193.4 188.5 -4.4 -0.3Nondurable Goods…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..195.3 128.9 113.4 -4.1 -1.3
Trade, Transportation, Util ities…………………………………………………………………………………………………………………….584.1 573.5 650.1 -0.2 1.3Wholesa le Trade………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….133.5 126.1 145.4 -0.6 1.4Reta i l Trade………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….314.7 312.5 351.6 -0.1 1.2Transportation & Util ities………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….135.9 134.9 153.0 -0.1 1.3
Information…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………53.4 46.8 52.1 -1.3 1.1Financia l Activities……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………141.9 137.8 145.6 -0.3 0.6Profess ional & Bus iness Services……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..290.5 307.2 388.2 0.6 2.4Education & Heal th Services………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..275.2 366.6 443.9 2.9 1.9Leisure & Hospi ta l i ty………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….228.8 270.7 297.8 1.7 1.0Other Services…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….91.9 100.8 104.4 0.9 0.3Government……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….390.2 431.6 442.0 1.0 0.2
Federa l , Civi l ian………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..51.2 50.2 50.0 -0.2 0.0State & Loca l…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….338.9 381.4 392.0 1.2 0.3
*compound annual growth rate
Growth Rate (%)*Level (thous)
Tennessee Nonfarm Employment by Sector: 1999, 2009 & 2019
Source: Bureau of Labor Statistics and CBER-UT.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 8
1999 2009 2019 1999 to 2009 2009 to 2019
Total Durable Goods…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….304.5 193.4 188.5 -4.4 -0.3Wood Products…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….19.7 12.0 11.2 -4.9 -0.7Nonmetal l i c Minera ls…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..16.1 13.1 12.4 -2.1 -0.6Primary Meta ls…………………………………………………………………………………………………………………….………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….17.8 9.9 9.8 -5.7 -0.1Fabricated Meta ls……………………………………………………………………………………………………………………………………………………………………………………………………………...........................46.1 35.4 34.6 -2.6 -0.2Machinery……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………43.3 28.8 29.3 -4.0 0.2Computers & Electronics…………………………………………………………………………………………………………………………………………………15.7 6.5 4.1 -8.5 -4.6Electrica l Equipment, Appl iances & Components……………………………………………………………………………………………………………………..…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………30.1 18.6 17.4 -4.7 -0.7Transportation Equipment………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..68.5 43.3 47.7 -4.5 1.0Furni ture………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………27.9 12.2 8.7 -7.9 -3.3Miscel laneous Durables………………………………………………………………………………………………………………………………………………………………………………19.3 13.6 13.5 -3.4 -0.1
Total Nondurable Goods…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………….195.3 128.9 113.4 -4.1 -1.3Food……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………34.4 30.3 31.1 -1.3 0.3Beverage & Tobacco………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………6.7 4.6 4.0 -3.7 -1.4Texti le Mi l l s , Texti le Mi l l Products & Apparel…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………39.7 13.0 7.7 -10.6 -5.1Paper…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………21.6 16.1 14.1 -2.9 -1.3Printing & Related Support…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………24.8 14.0 10.3 -5.6 -3.0Chemica ls………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………31.7 26.0 22.0 -2.0 -1.7Plastics & Rubber…………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………31.8 22.8 22.9 -3.3 0.0Miscel laneous Nondurable Goods………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………4.5 2.2 1.3 -7.0 -5.2
*compound annual growth rate
Growth Rate (%)*Level (thous)
Tennessee Manufacturing Employment: 1999, 2009 & 2019
Source: Bureau of Labor Statistics and CBER-UT.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 9
Tennessee Monthly Total Nonfarm Employment Indexed to Beginning of
Recession
85.0
90.0
95.0
100.0
105.0
110.0
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36
Nov 1973Jan 1980Jul 1990Mar 2001Dec 2007Forecast
Inde
x, m
onth
#1
= 10
0.0
Number of months from recession start month
Note: Employment data are seasonally adjusted.
Source: Calculated by CBER using data from the Bureau of Labor Statistics.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 10
TN Initial Unemployment Insurance Claims and Benefits Paid: Jan-07 to Feb-10
-100.0
-50.0
0.0
50.0
100.0
150.0
200.0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10
ClaimsBenefits
Per
cent
age
chan
ge,
sam
e m
onth
last
yea
r
Source: U.S. Department of Labor.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 11
Less than 10.0%10.0% to 14.9%
Note: County data are not seasonally adjusted.
Source: Bureau of Labor Statistics.
15.0% to 19.9%20.0% or higher
Unemployment Rate: January 2010
Tennessee NSA 11.5%United States NSA 10.6%
January SA rates: TN 10.7% US 9.7%
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 12
Domestic Migration: 2000, 2007 & 2009
Source: U.S. Census Bureau.
2000 2007 2009
North Carolina 11,124 120,063 59,108
South Carolina 4,527 52,884 31,480
Georgia 16,766 93,094 26,604
Tennessee 4,859 44,867 20,605
Virginia 6,490 -584 18,238
Louisiana -7,443 29,970 14,647
Alabama -1,489 16,826 11,044
Kentucky 806 12,666 6,268
Arkansas 1,282 8,199 5,298
West Virginia -1,709 2,651 4,510
Mississippi -484 3,968 -5,529
Florida 28,761 16,707 -31,179
Number
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 13
Tennessee Monthly SA Unemployment Rate Indexed to Beginning of Recession
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36
1980 JanJul 1990Mar 2001Dec 2007Forecast
Diff
eren
ce fr
om in
itial
rate
(poi
nts)
Number of months from recession start month
Note: Unemployment rate data are seasonally adjusted.
Source: Calculated by CBER using data from the Bureau of Labor Statistics.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 14
Tennessee Building Permits:January 2005 to January 2010
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Jan-05
May-05
Sep-05
Jan-06
May-06
Sep-06
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
TotalSingle-family
Num
ber
of u
nits
Source: U.S. Census Bureau, Building Permits Survey (as reported in the State of the Cities Data System [SOCDS] database).
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 15
Mortgage Delinquency Rate (90+ Days Past Due): 1995.1 to 2009.4
0.00
2.00
4.00
6.00
8.00
10.00
12.00
95.1 96.1 97.1 98.1 99.1 00.1 01.1 02.1 03.1 04.1 05.1 06.1 07.1 08.1 09.1
TN
U.S.
Pe
rce
nta
ge
of l
oa
ns
Source: Mortgage Bankers Association, National Delinquency Survey
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 16
Loans In Foreclosure: 1995.1 to 2009.4
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
95.1 96.1 97.1 98.1 99.1 00.1 01.1 02.1 03.1 04.1 05.1 06.1 07.1 08.1 09.1
TN
U.S.
Pe
rce
nta
ge
of i
nve
nto
ry a
t en
d o
f qu
art
er
Source: Mortgage Bankers Association, National Delinquency Survey
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 17
Growth in State Quarterly Tax Revenue:October-December 2008 to 2009
(year over year % change)
Less than 10.0%-10.0% to -5.0%-4.9% to 0%Greater than 0%No data
U.S. -4.1%
Source: Calculated by the Rockefeller Institute from Census data.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 18
TN Tax Collections, Total and Sales & Use:January 2007 to February 2010
-15.0
-10.0
-5.0
0.0
5.0
10.0
15.0
20.0
Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10
TotalSales & Use
Per
cent
age
chan
ge,
sam
e m
onth
last
yea
r
Source: Tennessee Department of Revenue, Revenue Collections, monthly.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 19
Tennessee Monthly Sales & Use Tax Revenue Indexed to Beginning of Recession
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
180.0
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36
Nov 1973Jan 1980Jul 1990Mar 2001Dec 2007
Inde
x, m
onth
#1
= 10
0.0
Number of months from recession start month
Source: Calculated by CBER using data from the Tennessee Department of Revenue.
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 20
Actual and Adjusted Total Tennessee Tax Collections as a Share of Personal Income, 1970 to 2009
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009
Actual Revenues
Adjusted Revenues
shar
e of
per
sona
l inc
ome
(per
cent
)
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 21
Tennessee Revenue Forecast: March 2010(millions of dollars)
Tax 2007 2008 2009 2010 2011Sales and Use 6,815.4 6,851.2 6,320.8 6,100.0 6,252.5Gasoline 612.3 617.1 601.8 604.0 604.0Motor Fuel 185.9 182.9 154.5 148.0 152.4Gasoline Inspection 65.3 65.2 61.6 61.5 62.7Motor Vehicle Registration 257.4 251.3 238.8 246.0 253.4Income 247.6 292.0 220.4 178.0 188.7Privilege 313.8 279.0 232.7 214.0 222.6Gross Receipts 277.6 291.0 317.5 337.9 346.7Gross Receipts - TVA 250.2 271.2 285.1 317.9 324.3Gross Receipts - Other 27.4 19.8 32.4 22.0 22.4Beer 18.0 17.9 17.8 17.3 17.7Alcoholic Beverage 41.0 42.6 44.1 46.5 48.5Franchise & Excise 1,766.1 1,619.5 1,361.8 1,425.0 1,453.5Inheritance & Estate 112.4 112.8 80.1 84.0 84.0Tobacco 138.0 286.0 300.0 292.0 297.8Motor Vehicle Title 11.1 11.4 9.8 10.2 10.3Mixed Drink 53.7 54.9 54.1 55.0 57.8Business 133.8 138.2 135.0 150.0 157.5Severance 1.5 2.6 2.1 2.0 2.0Coin Amusement 0.3 0.3 0.4 0.3 0.3Unauthorized Substance 1.7 0.2 0.0 0.0Total 11,052.7 11,117.6 10,153.5 9,971.7 10,212.4
Actual Estimate
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 22
Total Tennessee Tax Revenues and Revenues as a Share of Personal Income, 2007 to 2019
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
Revenues
Revenues as a Share of Personal Incometax
reve
nu
es
(mill
ion
s o
f do
llars
)re
ven
ue
s as a
sha
re o
f pe
rson
al in
com
e (%
)
← →History← → CyclicalForecast
Trend Forecast← →
Policy Neutral
Scenario
Policy Change
Scenario
March 2010 Matthew N. Murray, Center for Business and Economic Research, UT Knoxville 23
Center for Business & Economic Research
College of Business AdministrationThe University of Tennessee, Knoxville
716 Stokely Management Center916 Volunteer Boulevard
Knoxville, Tennessee 37996-0570
phone: 865.974.5441fax: 865.974.3100
http://cber.bus.utk.edu