2018 Economic Outlook

Transcription

1 2018 Economic Outlook presented at the North Haven EDC Breakfast 4/12/18 About CERC CERC drives economic development in Connecticut by providing research based data, planning and implementation strategies to foster business formation, recruitment and growth. Private, nonprofit organization; founded in 1992 Funded by utility and telecommunication companies, state contracts, and fee based services Provide research, municipal, business, real estate, and marketing services 1

2 Presentation Outline Global Trends National Trends Connecticut Effects North Haven Changes Percentage of World GDP (GDP in Current U.S Dollars) 30.0% 25.0% 27.6% 24.3% 20.0% 15.0% 14.9% 10.0% 5.0% 4.8% 10.0% 5.9% 0.0% Source: World Development Indicators Database, World Bank, Feb,

3 World Output Estimates World U.S Euro Area Canada Japan U.K Emerging Market Source: World Economic Outlook, October China Low income U.S. Tax Reform Provides Slight Lift to Economic Growth Lower rates on corporate and personal income should increase business investment and consumer consumption during Anticipated employment gains and wage growth As inflation remains close to 2 percent target and labor situation improves, federal funds rate is projected to rise gradually, perhaps to 1.75 percent by 2018 Q3. However, after tax reform boost, business investment is expected to slow, along with labor force growth, which will lower consumption later in the year and into

4 Property & Casualty Insurance: Adapt Traditional insurance models need to adapt to: Fewer insurable workers due to robotic automation of industrial processes Sharing economy will shift insurance policies more toward commercial Fewer home owners, more renters Retail: The Experience Physical stores: Experiences that make the customer feel relaxed and comfortable lead to increases in sales and a clear differentiation from the online experience. Online Stores: In addition to offering faster delivery times, online businesses have formed partnerships with stores for pick up and return options. 4

5 Warehousing Rapid delivery Smaller packages Variety of goods VS. Large number of same goods on pallets Financial Services New trends: User friendly online interface Fewer/no local bankers International expansion Longer term goals: Enhancing cyber security Responding to breaches in a transparent and customer friendly way 5

6 Manufacturing: Automation A fundamental economic transition Automation and robotic technology becomes more widespread for manufacturing businesses Will cause disruption or displacement of jobs but will also will create approximately 15 million new jobs in the U.S. over the next ten years Construction Slow Growth ADVANTAGES OFFSET BY CHALLENGES Technology advancements: Drones, self driving vehicles, visualization Software and hardware Increased costs in raw materials and labor 6

7 Healthcare The cost of health care and medical procedures continues to grow Major focus of the industry is figuring out ways to reduce costs without compromising quality of care CT Employment Change Financial Activities Education And Health Services Professional & Business Services Other Services. Construction, Natural Resources & Mining Manufacturing Trade, Transportation, Utilities Leisure And Hospitality Government Information 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% 0.5% 1.0% 1.5% 2.0% Source: CT Department of Labor 7

8 CT Median Household Income $73,000 $72,000 $71,000 $70,000 $69,000 $68,000 $67,000 $66,000 $65, Median Household Income Source: U.S Census Bureau CT Population by Race 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 Two or more races Some other race alone Native Hawaiian and Other Pacific Islander alone Asian alone American Indian and Alaska Native alone Black or African American alone White alone 500, Source: U.S Census Bureau 8

9 CT Native vs. Foreign Born 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000, , Native Foreign Born Source: U.S Census Bureau CT Population by Age Below and over 7% 7% 7% 7% 7% 7% 7% 28% 28% 29% 29% 30% 30% 31% 33% 33% 33% 32% 32% 31% 31% 32% 32% 32% 31% 31% 31% 31% Source: U.S Census Bureau

10 CT Resident Population In Thousands 3620 Resident Population in CT Resident Population in CT Source: Federal Reserve Economic Data Components of Population Change Pre and Post recession 50,000 40,000 30,000 20,000 10, ,000 Births Deaths Net International Migration Net Domestic Migration 20,000 30, Average Average Source: Connecticut s Population and Migration Trends: A Multi-Data Source Dive, CT Office of Policy and Management,

11 CT Housing Permits ,500 5,500 4,500 3,500 2,500 1, , Unit 2 4 Unit 5 + Units Demolitions Net Total Source: U.S Census Bureau North Haven: Population by Age 100% 90% 80% 70% 60% 50% 40% 30% 20% 75 and over Under 15 10% 0% Source: U.S Census Bureau, Census Tract

12 North Haven: Population by Household Income 100% 90% 80% 70% 60% 50% 40% 30% Over $150K $100K $150K $50K $100K Under $50K 20% 10% 0% Source: U.S Census Bureau, Census Tract North Haven: Population by Education 100% 90% 80% 70% 60% 50% 40% 30% Graduate or professional degree Bachelor's degree Associate's degree Some college, no degree High school graduate Less than 12th grade 20% 10% 0%

13 Amazon in North Haven We re excited to open a new, state-of-the-art fulfillment center in North Haven, creating more than 1,500 full-time jobs that offer wages 30 percent higher than traditional retail roles and include comprehensive benefits on day one, bonuses and stock awards, -Akash Chauhan, Amazon s vice president of North America operations Source: ct.gov Press Release Conclusions Projections for global and national economic growth are positive. Estimate for Connecticut s economic performance in 2018 is modest. Overall industry trends affecting the competitiveness of businesses all over the nation and globe will also affect how companies do business in the state. Any substantial changes in population or employment will affect Connecticut s economy. North Haven has seen and will continue to see positive effects from business and institution expansions. 13

14 Thank You! Alissa DeJonge Vice President of Research