Uinta Basin Energy Summit Economic Overview September 10, 2015

Transcription

1 Uinta Basin Energy Summit Economic Overview September 10, 2015

2 Overview National Economic Conditions Utah Economic Conditions

3 Utah is One of the Fastest Growing CA States in the Country Percent Change in Population for States: 2012 to 2013 WA 1.1% OR 0.8% NV 1.3% AK ID National U.S. Rate = VT ND Economic MT 3.1% MN 0.8% SD WI 1.3% MI WY PA IA NE 0.5% OH IL IN 0.2% UT Conditions 0.5% WV 1.6% VA CO MO KY - KS 1.5% 0.4% NC TN 0.6% AZ OK SC AR NM 1.2% 1.1% MS AL GA 0.2% 0.8% HI TX 1.5% LA 0.5% 1.15% or more.075% to 1.10% 0.5% to 0% to 0.4% Population Loss FL 1.2% NH NY 0.4% ME -0.01% DC 2.1% CT DE MD MA RI NJ 0.4% Source: U.S Census Bureau

4 Utah is One of the Fastest Growing CA States in the Country How long will interest Percent Change in Population for States: 2012 to 2013 U.S. Rate = NH rates stay so low?... WA ME 1.1% VT -0.01% ND MT 3.1% MN OR 0.8% NY 0.8% 0.4% NV 1.3% ID WY SD 1.3% NE OH IL IN 0.2% UT 0.5% WV 1.6% VA CO MO KY - KS 1.5% 0.4% It s up to the Fed NC TN 0.6% AZ OK SC AR NM 1.2% 1.1% DC 2.1% AK HI TX 1.5% IA 0.5% WI LA 0.5% MS 0.2% MI AL 1.15% or more.075% to 1.10% 0.5% to 0% to 0.4% Population Loss GA 0.8% PA FL 1.2% CT DE MD MA RI NJ 0.4% Source: U.S Census Bureau

5 Payroll Change 000 s National Job Growth Improving Million Jobs Lost Million Jobs Recovered Source: Bureau of Labor Statistics

6 U.S. Unemployment Rates Dropping % in Aug 3.0 Sources: U.S. Bureau of Labor Statistics, Utah Department of Workforce Services

7 Feb 2012 Aug 2012 Feb 2013 Aug 2013 Feb 2014 Aug 2014 Feb 2015 Aug 2015 Consumer Confidence is Rising, but Not Robust Source: U.S. CCI from The Conference Board

8 Contribution to GDP Growth Consumption Drives Growth 5% Total GDP Growth 0% -5% Fixed Investment Inventories Net Exports Government Personal Consumption Source: Bureau of Economic Analysis

9 Growth in Consumer Spending Remains Low 5.0 Personal Consumption Expenditure Yearly Percent Change Source: Bureau of Economic Analysis

10 Jul 2011 Oct 2011 Jan 2012 Apr 2012 Jul 2012 Oct 2012 Jan 2013 Apr 2013 Jul 2013 Oct 2013 Jan 2014 Apr 2014 Jul 2014 Oct 2014 Jan 2015 Apr 2015 Jul 2015 Inflation Remains Very Low 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 0.5% 0.0% -0.5% Source: U.S. CPI from National Bureau of Labor Statistics

11 US Dollar Compared to Chinese Yuan Inverted Scale $6.00 $6.50 $7.00 $7.50 $ China stops the yuan s rise 2001 China joins WTO 2005 China allows the yuan to rise 2010 China allows the yuan to rise Aug 2015 China devalues the yuan by largest amount in 20 years $ Source: Federal Reserve Bank of St Louis

12 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 $ Per Barrel Oil Prices Show Volatility After Recent Lows $ $ West Texas Intermediate $108 $ $90.00 $80.00 $70.00 $60.00 $50.00 $40.00 $30.00 $38 Sources: U.S. Energy Information Administration and Quotenet.com

13 $ Per Barrel Oil Prices Rising But Still Below Long Term Trend $ $ Source: U.S. Federal Reserve

14 ,200 Active U.S. Oil Rigs 2,000 1,931 1,800 1,600 1,400 1,200 1, Sources: Baker Hughes

15 Year Mortgage Rate, Fed Rate and CPI Effective Fed Rate 30 Year Fixed Mortgage CPI Year Over Change Rate - Unadjusted Source: U.S. Federal Reserve and National Bureau of Labor Statistics

16 Federal Funds Rate Outlook Median FOMC Forecast 1.875% 0.25% 2 moves 25 bps 0.625% 4 moves 25 bps $0 $0 $0 Mar Jun Sep Dec Mar Jun Sep Dec Source: Source: American Bankers Association Analysis of Data from the Federal Reserve

17 Utah is One of the Fastest Growing CA States in the Country How long will interest Percent Change in Population for States: 2012 to 2013 U.S. Rate = NH rates stay so low?... WA ME 1.1% VT -0.01% ND MT 3.1% MN OR 0.8% NY 0.8% 0.4% NV 1.3% AK ID UT 1.6% AZ 1.2% SD 1.3% WI WY PA IA NE 0.5% OH Emotion IL IN vs 0.2% 0.5% WV VA CO MO KY - KS 1.5% 0.4% NC TN 0.6% OK SC Fundamentals AR NM 1.1% MS AL GA 0.2% 0.8% TX LA 1.5% 0.5% HI MI 1.15% or more.075% to 1.10% 0.5% to 0% to 0.4% Population Loss FL 1.2% DC 2.1% CT DE MD MA RI NJ 0.4% Source: U.S Census Bureau

18 Utah is One of the Fastest Growing CA States in the Country Percent Change in Population for States: 2012 to 2013 U.S. Rate = NH Utah Economic WA ME 1.1% VT -0.01% ND MT 3.1% MN OR 0.8% NY 0.8% ID SD WI 0.4% NV 1.3% AK WY PA IA Conditions NE 0.5% OH IL IN 0.2% UT 0.5% WV 1.6% VA CO MO KY - KS 1.5% 0.4% NC AZ 1.2% HI NM 1.3% TX 1.5% OK AR LA 0.5% MS 0.2% MI TN 0.6% AL 1.15% or more.075% to 1.10% 0.5% to 0% to 0.4% Population Loss SC 1.1% GA 0.8% FL 1.2% DC 2.1% CT DE MD MA RI NJ 0.4% Source: U.S Census Bureau

19 Utah Population 7 th Fastest Growing in U.S. CA OR 1.1% WA 1.3% NV 1.7% ID 1.3% UT 1.4% AZ 1.5% AK - MT WY 0.2% CO 1.6% NM - HI 0.8% Percent Change: 2013 to 2014 U.S. Rate = ND 2.2% SD NE TX 1.7% KS OK 0.6% MN 0.6% IA 0.5% MO AR WI LA 0.4% IL - MS MI IN 0.4% TN 0.8% AL or more OH 0.2% KY to (at or above U.S. rate) 0.4% to 0.6% 0.0% to Population Loss WV -0.2% VT 0.0% PA 0.0% NC SC 1.3% GA VA FL 1.5% NH NY ME DC 1.5% CT - DE 1.1% MD 0.6% MA 0.5% RI 0.2% NJ Source: U.S Census Bureau

20 Utah Components of Population Change 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10, ,000-20,000 Population Change Natural Increase Net Migration Source: Utah Population Estimates Committee, U.S. Census Bureau, State of Utah Revenue Assumptions Working Group

21 Utah Population Growth Rates By County 2013 to 2014 Box Elder 1.3% Tooele 1.4% Davis 2.1% Cache Weber Morgan 4.0% Salt Lake Utah 1.6% Rich Summit 1.7% Wasatch 4.3% Duchesne 1.4% Daggett -1.2% Uintah 3.3% State Average = 1.4% Juab 1.5% Carbon -1.3% Increase of 2.0% or Greater Millard -0.2% Sanpete 0.8% Sevier - Emery -0.8% Grand Increase of 1.5% to 1.9% Beaver 0.0% Piute -2.6% Wayne - Increase of to 1.4% Iron 1.2% Garfield -0.8% Increase of 0.0% to San Juan 1.7% Population Loss Washington 2.9% Kane 0.2% Source: U.S. Census Bureau

22 Utah s Employment Growth Highest in the Country CA 3.2% OR 3.2% WA 3.3% NV 3.7% AK 0.0% ID 2.7% UT 4.4% AZ 2.1% Percent Change in Employment for States: July 2014 to July 2015 U.S. Rate = 2.1% MT WY 0.2% HI 1.2% CO 2.0% NM 0.5% ND -0.6% SD 2.1% NE 0.2% KS 0.4% TX 2.3% OK 0.6% MN IA 2.0% MO 1.4% AR 2.4% WI 1.6% LA 0.4% IL MS 1.4% MI 2.3% IN 2.1% TN 1.9% AL 1.4% 2.7% or more OH 1.1% KY 1.6% GA 2.1% WV -2.5% VT 1.5% PA 1.1% NC 2.7% SC 2.8% VA 1.1% FL 3.5% NH 1.2% NY 1.8% 2.1% to 2.6% (at or above the U.S. rate) 1.3% to 2.0% 0.8% to 1.2% ME DC 1.9% CT 1.8% DE 1.7% MD 2.1% MA 2.0% RI 1.3% NJ 0.5% Note: Seasonally Adjusted Source: Bureau of Labor Statistics and below

23 Top States for Employment Growth July 2014 vs. July 2015 Top 10 July 2014 July 2015 Ranking 1. North Dakota 49th 2. Nevada 2nd 3. Utah 1st 4. Texas 11th 5. Colorado 18th 6. Florida 3rd 7. Delaware 25th 8. Oregon 6th 9. Arizona 13th 10. Washington 4th 31. Idaho 8th Source: Bureau of Labor Statistics

24 Utah Total Employment at New Highs 1,600 1,500 1,400 Gain of 189,000 jobs Thousands of Jobs 1,300 1,200 1,100 1, Loss of 91,000 jobs Source: U.S. Bureau of Labor Statistics Note: January 2015 (prediction)

25 UT Industries - Employment Change Percent Change in Utah Employment by Industry: July 2014 to July 2015 Ntl. Res. & Mining -6.5% Total: 4.5% Construction 2.2% Manufacturing 4.8% Trade, Trans., Utilities 3.4% Information Financial Activity 4.4% 5.1% Prof. & Bus. Serv. Ed. & Health Serv. 5.7% 6.3% Leisure & Hospitality 10.5% Other Services 3.4% Government 1.1% -8% -6% -4% -2% 0% 2% 4% 6% 8% 10% 12% Source: Utah Department of Workforce Services

26 Most UT Industries Seeing Growth Ntl. Res. & Mining -800 Total Change in Utah Employment by Industry: July 2014 to July 2015 Total: 59,100 Construction 1,800 Manufacturing 5,800 Trade, Trans., Utilities 8,600 Information 1,700 Financial Activity 3,300 Prof. & Bus. Serv. 11,700 Ed. & Health Serv. 9,600 Leisure & Hospitality 13,700 Other Services 1,300 Government 2,400-2, ,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 Source: Utah Department of Workforce Services

27 Utah Employment Change Rates By County July 2014 to July 2015 Box Elder 2.3% Tooele Davis 3.8% Cache 2.3% Rich 2.2% Weber 3.8% Morgan 3.1% Salt Lake 3.7% Utah 6.2% Summit 2.7% Wasatch 3.8% Duchesne -9.2% Daggett 1.7% Uintah -6.9% State Rate = 4.5% Juab 6.1% Carbon 3.3% 4.5% or more Millard 1.1% Sanpete Sevier 2.6% Emery -7.5% Grand 2.1% 3.1% to 4.4% Beaver 5.1% Piute 0.8% Wayne -0.4% 2.1% to 3.0% 0.0% to 2.0% Iron 1.6% Garfield 2.4% San Juan 2.2% Below 0.0% Washington 5.4% Kane 1.6% Source: Utah Department of Workforce Services, Not seasonally adjusted

28 Utah Has 3 rd Lowest Unemployment Rate in the Country OR 5.5% CA 6.3% WA 5.3% NV 6.9% ID 4.0% UT 3.5% AZ 5.9% MT 3.9% WY 4.1% CO 4.4% NM 6.4% July 2015 U.S. Rate = 5.3% ND 3.1% SD 3.8% NE 2.6% KS 4.5% OK 4.5% MN 3.9% IA 3.7% MO 5.8% AR 5.7% WI 4.6% IL 5.9% MS 6.6% MI 5.5% IN 4.9% TN 5.7% AL 6.1% OH 5.2% KY 5.1% GA 6.1% WV 7.4% VT 3.6% PA 5.4% NC 5.8% SC 6.6% VA 4.9% NH 3.8% NY 5.5% ME 4.7% DC 7.0% CT 5.7% DE 4.7% MD 5.2% MA 4.6% RI 5.9% NJ 6.1% AK 6.8% TX 4.2% LA 6.4% 4.0% or less FL 5.5% 4.1% to 4.6% HI 4.0% 4.7% to 5.5% (at or below the U.S. rate) 5.6% to 6.0% 6.1% or more Note: Seasonally Adjusted Source: Bureau of Labor Statistics

29 Utah vs. U.S. Unemployment Rates U.S. Utah Sources: U.S. Bureau of Labor Statistics, Utah Department of Workforce Services

30 Utah Unemployment Rates By County July 2015 Box Elder 3.7% Tooele 4.1% Cache 3.1% Weber 4.0% Davis 3.5% Salt Lake 3.4% Morgan 3.2% Utah 3.3% Rich 3.6% Summit 3.2% Wasatch 3.4% Duchesne 7.2% Daggett 4.5% Uintah 6.4% Juab 3.8% Carbon 5.7% State Rate = 3.6% 3.3% or lower Millard 3.5% Sanpete 4.1% Sevier 4.4% Emery 6.1% Grand 5.8% 3.4% to 3.6% Beaver 3.9% Piute 5.9% Wayne 8.7% 3.7% to 4.5% Iron 4.5% Garfield 8.4% 4.6% to 6.5% Washington 4.2% Kane 4.4% San Juan 7.6% 6.6% or greater Source: Utah Department of Workforce Services

31 Jul 2011 Jan 2012 Jul 2012 Jan 2013 Jul 2013 Jan 2014 Jul 2014 Jan 2015 Jul 2015 Consumer Price Index Wasatch Front vs. United States 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 0.5% 0.0% -0.5% - Year Over Year Change United States CPI Zions Bank Wasatch Front CPI Source: U.S. CPI from National Bureau of Labor Statistics and Wasatch Front CPI from Cicero Group

32 Feb 2012 Aug 2012 Feb 2013 Aug 2013 Feb 2014 Aug 2014 Feb 2015 Aug 2015 US Consumer Confidence Index vs. UT Consumer Attitude Index Above 110 indicates economic prosperity Zions Bank Utah Consumer Attitude Index United States Consumer Confidence Index 50.0 Source: U.S. CCI from The Conference Board and Utah CAI from Cicero Group

33 Thousands U.S. vs. UT Median Existing Home Prices $240 $220 $200 $180 $160 $140 $120 Utah United States Source: Moody s Analytics

34 f Utah Residential Construction Activity 25,000 20,000 15,000 10,000 5,000 0 Single-Family Units Multifamily Source: University of Utah, David Eccles School of Business, Bureau of Economic and Business Research

35 f 2016f Millions UT Value of New Construction $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 Residential Nonresidential Renovations Total Source: University of Utah, David Eccles School of Business, Bureau of Economic and Business Research f = forecast

36 Utah Economic Indicators Population Nonfarm Employment Unemployment Rate Personal Income Home Prices Retail Sales e 2015f 2016f Source: State of Utah Revenue Assumptions Working Group e = estimate f = forecast

37 Robert Spendlove Economic and Public Policy Officer Phone: Presentations are offered for informational purposes only and should not be construed as tax, legal, financial or business advice. Please contact a professional about your specific needs and advice. Presentations may contain trademarks or trade names owned by parties who are not affiliated with Zions Bank. Use of such marks does not imply any sponsorship by or affiliation with third parties, and Zions Bank does not claim any ownership of or make representations about products and services offered under or associated with such marks.