Regional Economic Press Briefing

Transcription

1 Federal Reserve Bank of New York Regional Economic Press Briefing February 14, 2011 The views expressed here are those of the presenters and do not necessarily represent the views of the Federal Reserve Bank of New York or the Federal Reserve System.

2 Regional Economic Update Jaison Abel, Economist

3 Overview I. Economic Activity During Q4-2010, economic activity declined slightly in New York State, New York City, and New Jersey; while activity picked up some in Puerto Rico II. Employment Trends Job growth in the region was weaker than in the U.S. in Q4 III. Unemployment Rate While down from peak levels, unemployment in the region remains stubbornly high 2

4 Regional Economic Activity Index of Coincident Economic Indicators (CEI) 104 Index (December 2007 = 100) Nov05 Jan08 Apr08 Apr08 Last Briefing Sep-Dec Percent Change Dec -0.2% 88 Nov +0.5% Shading indicates 86 NBER recession Jan07 Jul07 Jan08 Jul08 Jan09 Jul09 Jan10 Jul10 Jan11 NJ NYC Dec09 Dec09 NY PR -0.3% -0.6% Source: Federal Reserve Bank of New York; Puerto Rico Government Development Bank Note: The Puerto Rico composite index is based on a different methodology than the indexes produced by the FRBNY. 3

5 Regional Employment Trends Seasonally Adjusted 102 Index (December 2007 = 100) Last Briefing NYC NY Sep-Dec Percent Change -0.2% +0.2% Dec 94 NJ U.S. Census +0.3% Jan +0.0% Shading indicates -1.0% NBER recession 88 Jan07 Jul07 Jan08 Jul08 Jan09 Jul09 Jan10 Jul10 Jan11 PR Source: Bureau of Labor Statistics and Moody s Economy.com 4

6 Employment Growth by Sector Seasonally Adjusted, Percent Change, September to December 2010 U.S. New York New York City New Jersey Puerto Rico State & Local Government -0.1% -0.2% -1.8% -0.2% -1.1% Retail Trade 0.1% -0.3% -2.7% -1.0% 2.0% Manufacturing 0.2% -1.0% 1.0% 0.0% -2.8% Wholesale Trade 0.4% 0.2% -1.2% -0.9% -0.8% Professional & Business Services 1.1% 0.6% 1.7% 0.9% -0.9% Educational & Health Services 0.6% 1.5% 1.2% 0.7% -0.5% Financial Activities 0.0% 0.1% 0.2% 0.6% 0.2% Source: Bureau of Labor Statistics and Moody s Economy.com 5

7 Employment Growth Within the Region Seasonally Adjusted, Percent Change, September to December Percent 0.75 Rochester U.S. 0.3 Syracuse 0.5 Buffalo Ithaca Lower Hudson 0.4 Long Island Albany -0.7 Binghamton NYC -0.3 Fairfield Edison Bergen Hudson Passaic -0.7 Newark Source: Bureau of Labor Statistics and Moody s Economy.com Note: Lower Hudson is comprised of the Kingston and Poughkeepsie MSAs and the Putnam-Rockland-Westchester Special BLS Area. 6

8 Regional Unemployment Rates Seasonally Adjusted Rates 18 Percent 16 PR 15.7% U.S. NYC NY NJ Dec 9.4% (9.0% Jan) 9.1% 8.9% 8.2% 6 4 Last 2 Briefing Shading indicates NBER recession 0 Jan07 Jul07 Jan08 Jul08 Jan09 Jul09 Jan10 Jul10 Jan11 Source: Bureau of Labor Statistics and Moody s Economy.com 7

9 Unemployment Rates Within the Region Seasonally Adjusted, December Percent U.S. 9.4 (9.0 Jan) Ithaca New Bergen Binghamton York Hudson Syracuse City Passaic Buffalo Fairfield Edison 8.9 Rochester Lower Long Albany Hudson Island Newark Source: Bureau of Labor Statistics and Moody s Economy.com 8

10 Summary The recent improvement in economic conditions experienced in much of the region has paused: Economic activity has declined slightly in most of the region Employment growth has generally been sluggish, with bright spots in upstate New York and the Lower Hudson Valley Unemployment rates have fallen modestly throughout the region, largely due to lower labor force participation, but remain high 9

11 Regional Trends in Household Debt Richard Deitz, Officer and Senior Economist

12 Outline I. How much debt did households take on during the run-up? Compared to U.S. averages, debt levels are relatively low in much of the region, although they rose to high levels in some pockets II. How much deleveraging has occurred? Debt reductions, while significant, have been milder than the U.S. average III. Signs of stress Delinquency rates are relatively high in some places, such as New York City and Long Island, Puerto Rico, and Upstate s urban cores IV. Our region s convalescence Recent increases in credit inquiries and auto debt suggest that more consumers are inclined to spend and borrow 11

13 FRBNY Consumer Credit Panel Data from individual credit reports, an anonymous random sample Includes information on various debt obligations: Mortgages Home Equity Line of Credit Auto Loans Student Loans Credit Cards Other Limited demographic information, but detailed geographic location Quarterly data,

14 Components of Household Debt in the U.S. Shares of Total Debt 100% 90% 80% 70% Other (9%) Student Loan (2%) Credit Card (10%) Auto Loan (8%) Home Equity LOC (2%) Other (3%) Student Loan (4%) Credit Card (6%) Auto Loan (6%) Home Equity LOC (6%) 60% 50% 40% Mortgage (69%) Mortgage (74%) 30% 20% 10% 0% 2000 Share 2010 Share Source: FRBNY Consumer Credit Panel 13

15 Regional Trends in Household Debt

16 Debt-to-Income Patterns in the Region Debt-to-Income Ratio by Metropolitan Area 2.0 Total Household Debt /Total Personal Income Las Vegas Stockton 1.2 Phoenix Rochester Albany U.S. 10Q2 0.6 Buffalo Shading indicates NBER recession Source: FRBNY Consumer Credit Panel, Bureau of Economic Analysis and Moody s Economy.com 15

17 Debt-to-Income Patterns in the Region Debt-to-Income Ratio by Metropolitan Area 2.0 Total Household Debt /Total Personal Income Stockton Long Island Edison 0.8 Newark U.S New York City Shading indicates NBER recession Source: FRBNY Consumer Credit Panel, Bureau of Economic Analysis and Moody s Economy.com 16a

18 Debt-to-Income Patterns in the Region Debt-to-Income Ratio by Metropolitan Area 2.0 Total Household Debt /Total Personal Income Stockton Puerto Rico Poughkeepsie Kingston Fairfield U.S. 0.6 New York City Shading indicates NBER recession Source: FRBNY Consumer Credit Panel, Bureau of Economic Analysis and Moody s Economy.com 16b

19 Debt-to-Income Ratios Across Metros 2010Q2 U.S. Average = to to to to 1.6 Source: FRBNY Consumer Credit Panel, Bureau of Economic Analysis and Economy.com 17

20 Debt-to-Income Ratios Across Metros 2010Q2 U.S. Average = 0.9 Buffalo 0.0 to to to to 1.6 Rochester Syracuse Utica Glens Falls Albany Ithaca Elmira Binghamton Kingston NYC Newark Edison NYC NYC Source: FRBNY Consumer Credit Panel, Bureau of Economic Analysis and Economy.com 18

21 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Buffalo Note: Zip code computations use Adjusted Gross Income rather than Personal Income, so figures will be a different scale than for metro areas. Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 19

22 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Syracuse Utica Glens Falls Buffalo Rochester Albany Ithaca Elmira Binghamton Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 20

23 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data New York Bronx Queens Brooklyn Staten Island Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 21

24 How Much Deleveraging Has Occurred?

25 Change in Debt From U.S. Peak Change in Debt Per Capita from 2008Q3-2010Q4 $2,500 $0 U.S. Las Vegas Buffalo +$212 Puerto Rico -$721 New York City Edison Newark Fairfield Island Long -$2,500 -$5,000 -$4,976 -$2,358 -$2,928 -$2,938 -$3,137 -$3,639 -$7,500 -$10,000 -$12,500 -$15,000 Mortgage (incl HELOC) -$17,500 Non Mortgage -$20,000 -$18,414 Source: FRBNY Consumer Credit Panel 23

26 Signs of Stress

27 Delinquency Rate Percent of Total Debt 90+ Days Delinquent 14 Percent New York City Long Island Puerto Rico 8 U.S. 10Q4 6 Northern NJ 4 Upstate NY 2 0 Shading indicates NBER recession Source: FRBNY Consumer Credit Panel 25

28 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Buffalo Source: FRBNY Consumer Credit Panel 26

29 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Syracuse Utica Glens Falls Buffalo Rochester Albany Ithaca Elmira Binghamton Source: FRBNY Consumer Credit Panel 27

30 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data New York Bronx Queens Brooklyn Staten Island Source: FRBNY Consumer Credit Panel 28

31 Have Consumers Been Seeking and Taking on New Debt in Recent Months?

32 Credit Inquiries Number of Credit Inquiries in Past 3 Months, Seasonally Adjusted 130 Index (2005Q1 = 100) Upstate NY Northern NJ New York City Puerto Rico Long Island U.S Q Shading indicates NBER recession Source: FRBNY Consumer Credit Panel 30

33 Auto Debt Per Capita $5,000 Dollars $4,500 $4,000 $3,500 $3,000 Las Vegas Buffalo 2010 Q1-Q4 Percent Change -4.8% +6.3% $2,500 $2,000 $1,500 $1,000 $500 $0 Shading indicates NBER recession Source: FRBNY Consumer Credit Panel 31

34 Change in Auto Debt Per Capita in 2010 Percent Change from 2010Q1 to 2010Q Percent Fairfield Buffalo Long Island Edison New York City Rochester Syracuse Newark Albany Puerto Rico Poughkeepsie U.S. Level Las Vegas -7.0 Sacramento Source: FRBNY Consumer Credit Panel 32

35 Conclusions Household debt is relatively low in much of the region, although in some pockets it has risen to high levels Deleveraging in the region, while severe by historical standards, has been milder than average Signs of stress for some households clearly remain; delinquencies are particularly high in some neighborhoods in NYC, Long Island, and upstate s urban cores Households in much of the region sought and took on some forms of new debt in 2010 A signal that consumers are willing to spend and borrow as credit has become more available and the economy recovers 33

36 Appendix

37 Employment Growth by Sector Seasonally Adjusted, Percent Change, September to December 2010 U.S. New York New York City New Jersey Puerto Rico Transportation & Utilities 1.6% -0.5% -0.6% 1.2% -4.8% Professional & Business Services 1.1% 0.6% 1.7% 0.9% -0.9% Education & Health Services 0.6% 1.5% 1.2% 0.7% -0.5% Other Services 0.6% -0.4% -4.0% 0.5% 0.0% Wholesale Trade 0.4% 0.2% -1.2% -0.9% -0.8% Manufacturing 0.2% -1.0% 1.0% 0.0% -2.8% Retail Trade 0.1% -0.3% -2.7% -1.0% 2.0% Federal Government 0.1% -2.0% -1.5% -0.9% 0.2% Financial Activities 0.0% 0.1% 0.2% 0.6% 0.2% Information -0.1% 0.2% 1.0% -1.5% -2.2% State & Local Government -0.1% -0.2% -1.8% -0.2% -1.1% Leisure & Hospitality -0.3% 0.4% -0.1% -2.0% -0.9% Construction & Mining -0.3% -1.0% -1.4% 1.8% -12.1% Source: Bureau of Labor Statistics and Moody s Economy.com 35

38 Labor Force Seasonally Adjusted, Percent Change, September to December Percent U.S NY -0.3 NJ NYC PR Source: Bureau of Labor Statistics and Moody s Economy.com 36

39 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Syracuse Utica Glens Falls Buffalo Rochester Albany Ithaca Elmira Binghamton Upstate Metros Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 37

40 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Kingston Pine Bush Middletown Poughkeepsie Holmes Lower Hudson Stony Point Spring Valley Peekskill Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com Mount Vernon 38

41 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data New York City New York Bronx Corona Queens Jamaica Brooklyn Staten Island Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 39

42 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Long Island Sag Harbor Middle Island Manorville Westbury Hempstead Bay Shore Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 40

43 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Blairstown Sussex Dover Paterson Dumont Newark Newark Clinton Plainfield Perth Amboy Northern New Jersey Edison Hazlet Cream Ridge Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 41 Howell

44 Debt-to-Income by Zip Code 2007 U.S. Rate = to to to to 3.3 Insufficient data Bethel Fairfield County Bridgeport Norwalk Stamford Source: FRBNY Consumer Credit Panel, Internal Revenue Service and Economy.com 42

45 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Syracuse Utica Glens Falls Buffalo Rochester Albany Ithaca Elmira Binghamton Upstate Metros Source: FRBNY Consumer Credit Panel 43

46 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Kingston Kerhonkson Ulster Park Rhinebeck Poughkeepsie Holmes Port Jervis Florida Lower Hudson Spring Valley Yonkers Source: FRBNY Consumer Credit Panel 44

47 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data New York City New York Bronx Elmhurst Queens Jamaica Brooklyn Staten Island Source: FRBNY Consumer Credit Panel 45

48 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Long Island Middle Island Southampton Westbury Hempstead Bay Shore Source: FRBNY Consumer Credit Panel 46

49 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Lafayette Dover Newark Paterson Hackensack Plainfield Newark Elizabeth Jersey City New Brunswick Perth Amboy Northern New Jersey Edison Source: FRBNY Consumer Credit Panel Cream Ridge 47

50 Delinquency Rates Share of All Debt 90+ Days Delinquent, 2010Q4 U.S. Rate = to to to to 40.6 Insufficient data Fairfield County Bridgeport Source: FRBNY Consumer Credit Panel 48