Will the Recovery Ever End? Certified Financial Planners

Transcription

1 Will the Recovery Ever End? Certified Financial Planners Place cover image here Richard Wobbekind Senior Economist and Associate Dean for Business and Government Relations January 25, 219

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3 Attention: This presentation is not being updated due to the lapse in Federal funding!

4 Real GDP Growth Quarterly Real GDP Percent Change, SAAR Average Average Average Sources: Bureau of Economic Analysis and Consensus Forecasts.

5 Economic Growth Percent Change Personal Consumption Expenditures Year-over-Year Fixed Business Investment Quarterly SAAR Year-over-Year Quarterly SAAR Year Percent Change Imports Government Spending Exports Net Exports Year-over-Year Quarterly SAAR Year Sources: Bureau of Economic Analysis, the National Bureau of Economic Research, and the Business Research Division.

6 Thousands, Month-over- Month, 12-Mo Average National Employment Month-over-Month Change, 12-Month Average Recession 8 Months Recession 18 Months Sources: Bureau of Labor Statistics (Seasonally Adjusted), Moody s Analytics, and NBER.

7 State Employment Growth Year-over-Year November 218 Source: Bureau of Labor Statistics (Seasonally Adjusted).

8 People per job opening Labor Slack Number of Available People Per Job Opening Pre-recession average Sources: BLS JOLTS, Labor Force, and Unemployment. Ratio of people not in the labor force who want a job now and the total number of unemployed, divided by total number of job openings.

9 Labor Underutilization Percentage of Labor Force Average U-6 U Average U-3 U-3 7.6% 3.9% Source: Bureau of Labor Statistics (Seasonally Adjusted).

10 Labor Force Participation Rate Percent of Population 16 and Over Colorado National 69.1% 62.9% Source: Bureau of Labor Statistics (Seasonally Adjusted).

11 Colorado LFPR State Ranking December November 218 Rank, 12-Month Average Source: Bureau of Labor Statistics, Current Population Survey. Notes: Colorado ranked 6th in July 218 based on the 12-month average and 4th in July alone.

12 U.S. Income and Consumption Percent Change Real Disposable Income Percent Change Real Personal Consumption % 3 2.7% Source: Consensus Forecasts.

13 Household Wealth $ Trillions Other Assets Mutual Funds Corporate Equities 2 Real Estate Source: Federal Reserve Board, Balance Sheet of Households and Nonprofit Organizations (B.11) (Not Seasonally Adjusted).

14 Securities Trends Indexed, January 2, 218=1 12 NASDAQ Dow Jones 115 S&P 5 Russell Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Source: Yahoo! Finance.

15 Household Debt Burden Percent of Disposable Income DSR 14 FOR Financial Obligations Ratio (R) Debt Service Ratio (L) Source: Federal Reserve, Household Debt Service and Obligations Ratios.

16 Index of Consumer Confidence 1985= Mountain Region Recession 8 months Recession 18 months United States Sources: The Conference Board and National Bureau of Economic Research.

17 Vehicle Sales and Retail Sales Thousands, SAAR 2, 18, 16, 14, 12, 1, 8, 6, 4, 2, Vehicle Sales Retail and Food Services Sales Annual Percent Change Sources: Bureau of Economic Analysis, Moody s Analytics, U.S. Census Bureau (Seasonally Adjusted Annual Rate).

18 Nominal Corporate Profits and Business Fixed Investment Percent Change Nominal Pre-Tax Corporate Profits Percent Change Business Fixed Investment % % Sources: Bureau of Economic Analysis, Consensus Forecasts.

19 ISM Indices ISM Manufacturing Index ISM Non-Manufacturing Index Source: Institute for Supply Management (ISM).

20 National FHFA Home Price Growth Year over Year Q3 218 Source: Federal Housing Finance Agency Home Price Index, All Transactions Index.

21 Federal Budget Balance $ Billions , -1,2 -$779 -$1,13-1,4-1, Sources: Bureau of Economic Analysis, NIPA Table 3.18B, Consensus Forecasts.

22 International Trade Colorado Export Destinations Canada 17% Index Jan. 1997= Trade Weighted U.S. Dollar, United Kingdom 3% Hong Kong 3% Netherlands 3% Germany 4% Rest of World 31% Republic of Korea 5% Japan 6% Malaysia 5% China 7% Mexico 16% Sources: World Institute for Strategic Economic Research, Board of Governors of the Federal Reserve System, Broad Dollar Index, and National Bureau of Economic Research.

23 Money, Interest Rates, and Prices

24 Percent Interest Rates 5 3-Year Conventional Year T-Note 3-Month T-Bill Sources: Federal Reserve and Moody s Analytics.

25 The FED Balance Sheet $ Trillions Other Assets Mortgage Backed Securities Federal Agency Debt Securities Treasury Securities Source: Federal Reserve Balance Sheet.

26 Percent Federal Funds Rate 219. March 218 Meeting June 218 Meeting September 218 Meeting December 218 Meeting Source: Bloomberg.

27 Percent of Balance 9+ Days Delinquent by Loan Type Percent 16% 14% Mortgage HELOC Auto CC Student Loan Other All 12% 1% 8% 6% 4% 2% % 23 Q3 24 Q3 25 Q3 26 Q3 27 Q3 28 Q3 29 Q3 21 Q3 211 Q3 212 Q3 213 Q3 214 Q3 215 Q3 216 Q3 217 Q3 218 Q3 Source: FRBNY Consumer Credit Panel/Equifax.

28 Inflation Percent Change All Items Denver-Aurora-Lakewood MSA United Sates Percent Change Core Inflation * * Shelter Medical Care Percent Change * Percent Change * Source: Bureau of Labor Statistics (NSA). * November 218 year-over-year.

29 Colorado Population, Employment, and Prices

30 Thousands 12, Colorado Change in Population 1, Colorado s population changes 79,7 in ,2 in 219 8, 6, 4, 2, Net Migration Natural Increase Ranked 8 th in total state growth Ranked 9 th for fastest growth Continued net migration into the state Sources: Colorado Demography Office, U.S. Census Bureau, and the Business Research Division.

31 Personal Income Growth 218 Q3 Source: Bureau of Economic Analysis.

32 Colorado Employment Growth Jobs Added Thousands , 53, Sources: Colorado Department of Labor and Employment and the Colorado Business Economic Outlook Committee.

33 Colorado Employment Change 219 Growth Employment in Thousands 2,79 2,78 2,77 2,76 2,75 2,74 Professional and Business Services Trade, Transportation, and Utilities Leisure and Hospitality Government Education and Health Services Construction Manufacturing Financial Activities Information Natural Resources and Mining Total jobs gained: 53,2 Other Services 219 2,73 2, Source: Bureau of Labor Statistics, Current Employment Statistics (SA).

34 Employment In Current Decade National, State, and Local Percent Change from January Greeley Ft. Collins-Loveland Denver Colorado Boulder Colorado Springs National Pueblo Grand Junction Source: Bureau of Labor Statistics (Seasonally Adjusted).

35 Colorado Wages 218 Q2 (4Q Rolling Average) Sector Total Employment YoY Employment Growth Average Wages YoY Wage Growth Management of companies and enterprises 39,8 5.4% $142,575.4% Utilities 8,25-1.9% $11, % Information 73,36 2.3% $11, % Professional and technical services 219, % $95, % Finance and insurance 111, % $95,13 2.7% Natural Resources and Mining 45, % $86,563 3.% Wholesale trade 17, % $84, % Federal Government 53,24-1.8% $8, % Manufacturing 145,55 1.7% $7,3 2.5% State Government 11,34 3.6% $64, % Construction 168,722 6.% $6,772 3.% All Industries 2,642, % $57, % Real estate and rental and leasing 51, % $58, % Transportation and warehousing 74,88 6.7% $56, % Health care and social assistance 296,23 1.9% $5, % Local Government 26, % $47,547 2.% Administrative and waste services 158,2 -.3% $41, % Educational services 36,28 2.3% $4, % Other services, except public administration 8, % $4, % Arts, entertainment, and recreation 56, % $37,36 4.3% Retail trade 272,28.7% $31, % Accommodation and food services 28,77 2.3% $22, % Source: Bureau of Labor Statistics, Quarterly Census of Employment and Wages.

36 Real Wage Growth Colorado Percent Change Year-over-Year Source: Bureau of Labor Statistics, QCEW and the Consumer Price Index. *218 based on Q1 QCEW.

37 Average Annual Wages Front Range 12-Month Average $1, $9, $8, $7, $6, $5, $4, $3, $2, $1, $65,794 Colorado: $57,858 Source: Bureau of Labor Statistics, QCEW, as of Q2 218.

38 Natural Resources and Mining

39 Crude Oil Production Largest Producers 1. Texas 2. North Dakota 3. New Mexico 4. Oklahoma 5. Colorado 6. California 7. Alaska 8. Wyoming 9. Louisiana 1.Utah Millions of Barrels Sources: Rankings from the Energy Information Administration. Production from the Colorado Oil and Gas Conservation Commission.

40 Natural Gas Production Billions of Cubic Feet 2, 1,8 1,8 1,6 1,4 1,2 1, th-largest producing state Residential prices 1th lowest in the country Residential sector consumes most Minimal price change expected Sources: Colorado Geological Survey Mineral and Mineral Fuel Activity Reports, Colorado Oil and Gas Conservation Commission, Department of Minerals and Geology, and Colorado Business Economic Outlook Committee.

41 Value of Natural Resources $ Billions $18 B Coal Minerals CO2 Natural Gas Crude Oil Sources: Colorado Geological Survey Mineral and Minerals Fuel Activity Reports, Colorado Oil and Gas Conservation Commission, Department of Minerals and Geology, and Colorado Business Economic Outlook Committee.

42 Renewables Ambitious renewable energy portfolio standard Includes wind, solar, hydro, geothermal, and biomass 22.3% of net generation Colorado ranks: 9th for wind capacity 12th for solar capacity Photo courtesy of Xcel Energy.

43 Construction Photo courtesy of Denver International Airport.

44 Colorado New Housing Units and Households 7, 6, ,895 more housing units than households 5, 4, Housing Units ,56 more households than housing units 3, 2, 1, Households Source: Colorado Department of Local Affairs, State Demography Office.

45 FHFA Home Price Index by MSA 1-year Home Price Change, Q3 218 Percent Change 25% 2% 15% 1% Colorado Springs MSA Greeley MSA Denver- Aurora- Lakewood MSA Fort Collins- Loveland MSA 5% % -5% -1% Pueblo MSA Grand Junction MSA Boulder MSA Source: Federal Housing Finance Agency, All Transactions Index (Not Seasonally Adjusted).

46 Residential Building Permits Permits 6, 5, Multifamily Single Family 4, 41,1 3, 2, 1, Sources: U.S. Census Bureau and the Colorado Business Economic Outlook Committee.

47 $ Millions 25, Value of Construction Colorado $21.6 B 2, 15, Nonbuilding Nonresidential Residential 1, 5, Sources: Dodge Data & Analytics and the Colorado Business Economic Outlook Committee.

48 Colorado Sales Tax Collections $ Millions, 12-Month Rolling Sum $3,5 $3, $2,5 $2, $1,5 $1, Strong job and income growth High consumer confidence High profile bankruptcies Competition from e-commerce Retail sales growth 5.5% in % in 219 $5 $ Sources: Colorado Office of the State Controller and the Colorado Department of Revenue.

49 $ Millions $16, $14, $12, Colorado General Fund $1, Other $8, $6, $4, Individual and Corporate Income $2, $ Sales, Use, and Other Excise Fiscal Years Source: Colorado Office of the State Controller and the Colorado Office of State Planning and Budgeting (December 218). Note: Excludes revenue transferred to the State Education Fund.

50 Venture Capital Investment Colorado Millions $2, $1,8 $1,6 $1,4 $1,2 $1, $8 Sample 218 Deals: Cherwell Software Paladina Health Guzman Energy minutekey Cogna Guild Education SomaLogic $6 $4 $2 $ Source: CB Insights.

51 Employment and New Entity Filings Employment, thousands 2,8 12-month total new entity filings 13, 2,7 12, 2,6 2,5 2,4 Employment New Entity Filings 11, 1, 9, 2,3 8, 2,2 7, 2, , Note: Solid line displays actual seasonally adjusted employment numbers; dotted line reflects calculated forecasts. Source: Seasonally adjusted. Colorado total nonfarm employees from the Bureau of Labor Statistics, Current Employment Statistics (CES), calculations by BRD research team.

52 Potential Headwinds for 219 International/National Interest rates Global growth Value of the dollar Trade/Tariffs State Commodity prices/cycle Drought and weather Housing affordability Talent shortage Real wage increases

53 Colorado Ranking Among Other States Metric 1-Year 3-Year 5-Year 1-Year Real GDP Growth Employment Growth Population Growth Personal Income Growth PCPI Growth (NA) PCPI (NA) Average Annual Pay % Growth Average Annual Pay Unemployment Rate Labor Force % Growth FHFA Home Price Index Growth Data Sources: Bureau of Economic Analysis (218), Bureau of Labor Statistics (1/18), U.S. Census Bureau (217), Bureau of Labor Statistics (218), Bureau Federal Housing Finance Agency All Transactions Index (Q3 218), BRD calculations. Note: 1-year, 3-year, and 5-year are based on the compound annual growth rate.

54 #COBizOutlook