The Economic Briefing

Transcription

1 The Economic Briefing February 24, 2016 Mississippi University Research Center Mississippi Institutions of Higher Learning Darrin Webb, State Economist (601) To subscribe to our publications, Janna Taylor at Visit our website for state and county level economic data Follow URC on

2 US Jobs Added By Month 400, ,000 (4,167) (177,000) (69,583) 22, , , , , , , ,917 25,917 97, , , , , ,917 (422,500) (143,833) (41,667) (297,417) 283, , , ,583 9, , , ,333 95,583 88, , , , , , ,000 (100,000) (200,000) (300,000) (400,000) (500,000) Job Growth has improved in recent years & ended 2015 on a relatively strong note, but the January report was weak February 2016 MS University Research Center, IHL 2 Average Monthly Gain By Year 84, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,000 50,000 Jan 16 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 Sep 15 Oct 15 Nov 15 Dec 15

3 US Employment Cost Index Wage and Salaries for All Civilian Workers Growth Over The Prior Year by Quarter 4.0% 3.5% Despite gains in 2014 and 2015 we continue to have below normal wage growth. 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% Mar 01 Mar 02 Mar 03 Mar 04 Mar 05 Mar 06 Mar 07 Mar 08 Mar 09 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 February 2016 MS University Research Center, IHL 3

4 Institute For Supply Management Indices An Index above 50 indicates expansion, below 50 a contraction 65.0 ISM Indices: above 50 is expanding The MFG Index was 48.2 in January, the lowest level since mid The Non MFG Index has declined for three straight months and is the lowest in 2 years Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 Jan 16 Manufacturing Index Nonmanufacturing Index February 2016 MS University Research Center, IHL 4

5 Land Rig Count Baker Hughes Rotary Rig Count US MS 2, , , , Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 Jan 16 US MS February 2016 MS University Research Center, IHL 5

6 Oil Prices WTI WTI= West Texas Intermediate, Forecast is from IHS $120 $100 $80 $60 $40 $20 $ Dollars Per Barrel Oil prices are expected to rise gradually and are not expected to reach $100 per barrel until February 2016 MS University Research Center, IHL 6

7 Consumer and Business Sentiment Both series weakened in The NFIB Index is at its weakest point since early Turmoil in the stock market is a factor in the decreased optimism. The weak January Jobs report is another Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 Jan 16 NFIB Small Business Optimism Index University of Michigan Consumer Sentiment February 2016 MS University Research Center, IHL 7

8 Growth In Real US GDP Historical and IHS Global Insight Baseline Projections % % % % % % % % % % % % % % % % % % % % % % % % % % % % 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 1.0% 2.0% 3.0% 4.0% February 2016 MS University Research Center, IHL 8

9 Growth In Real MS GDP Historical and University Research Center Projections 8.0% 0.9% 0.6% 0.5% 0.0% 0.5% 0.9% 0.9% 2.4% 2.0% 2.0% 2.7% 2.4% 2.2% 1.8% 1.9% 1.4% 1.0% 2.8% 2.7% 2.3% 1.9% 2.2% 4.0% 4.7% 5.6% 6.1% 6.0% 4.0% 2.0% With a downgrade in the National forecast, URC Projections fall slightly from that which was published in January. Previous forecast for 2016 was 2.2%. The 2017 forecast did not change. 0.0% 2.0% 4.0% 3.1% February 2016 MS University Research Center, IHL 9

10 MS Index of Coincident Indicators The MSCI showed tremendous upward momentum in This is largely due to a falling unemployment rate. Likewise the December dip was largely due to a rising unemployment rate. 108 Index 2004= Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 The Mississippi Index of Coincident Indicators reflects economic conditions existing in a given month. The index is constructed by the Federal Reserve Bank of Philadelphia and reindexed to The Index is based on changes in nonfarm employment, the unemployment rate, average manufacturing workweek length and wage and salary disbursements. February 2016 MS University Research Center, IHL 10

11 Unemployment Rate (2014Q4 2015Q3 Average) 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 12.3% 11.4% 10.8% 4.3% 4.1% 4.1% 0.9% 0.6% 0.7% 0.5% 0.8% 0.5% 6.5% 6.0% 5.4% MS SE (Exc. MS) US U 6: With All Marginally Attached Workers and Those Working Part Time for Economic Reasons U 5: With Discouraged workers and Other Marginally Attached Workers U 4: With Discouraged Workers U 3: Unemployment Rate February 2016 MS University Research Center, IHL 11

12 MS Unemployment Rates 4 Qtr Moving Average Gap Between U 6 and U 3 U 3 U 4 U 5 U :II 2004:I 2003:III 2004:II 2003:IV 2004:III 2004:II 2005:I 2004:III 2005:II 2004:IV 2005:III 2005:II 2006:I 2005:III 2006:II 2005:IV 2006:III 2006:II 2007:I 2006:III 2007:II 2006:IV 2007:III 2007:II 2008:I 2007:III 2008:II 2007:IV 2008:III 2008:II 2009:I 2008:III 2009:II 2008:IV 2009:III 2009:II 2010:I 2009:III 2010:II 2009:IV 2010:III 2010:II 2011:I 2010:III 2011:II 2010:IV 2011:III 2011:II 2012:I 2011:III 2012:II 2011:IV 2012:III 2012:II 2013:I 2012:III 2013:II 2012:IV 2013:III 2013:II 2014:I 2013:III 2014:II 2013:IV 2014:III 2014:II 2015:I 2014:III 2015:II 2014:IV 2015:III February 2016 MS University Research Center, IHL 12

13 Labor force Participation Rate by State November % CA 61.3% OR 62.8% WA 67.2% AK 63.4% NV 64.2% ID 59.7% AZ 68.1% UT 64.1% MT 67.9% WY 57.0% NM 62.1% HI 66.3% CO 69.7% ND 69.3% SD 63.4% TX 69.8% NE 67.8% KS 61.9% OK 69.9% MN 69.7% IA 65.1% MO 58.0% AR 59.8% LA U.S. 62.5% 67.8% WI 64.8% IL 56.3% MS 63.7% IN 60.3% MI 58.9% TN 56.2% AL 56.1% KY 62.4% OH 61.0% GA 50.0% < 60.0% 60.0% 65.0% > 65.0% 66.7% VT 53.0% WV 61.1% NC 59.0% SC 58.9% FL 62.6% PA 64.7% VA 67.9% NH 70.3% DC 60.9% NY 62.0% ME 63.8% NJ 67.0% MD 62.5% DE 64.5% MA 64.7% RI 65.6% CT February 2016 MS University Research Center, IHL 13

14 Labor force Participation Rate Percentage of Civilian Population 16 Yrs. And Over in the Labor Force US MS February 2016 MS University Research Center, IHL 14

15 Average Annual Growth in Employment FL AL GA NC SC TN KY MS US FL AR OK TX AL AR GA KY MS NC SC TN US LA AL GA FL LA MS NC OK US TX AR KY AL AR MS AL AR LA OK SC TN TX AL AR FL GA KY LA MS NC OK SC KY LA MS NC OK SC TN US MS US AL AR OK KY LA AL LA MS OK TN TX FL GA KY LA NC OK SC TN US FL GA NC SC TN US TX TX FL GA TX AR FL GA KY NC SC TN TX US 4.0% 2.0% 0.0% 2.0% 4.0% 6.0% Generally speaking, Mississippi was not hit as hard in the recession as other states. However, the state s recovery has been much slower. 8.0% February 2016 MS University Research Center, IHL 15

16 Employment Relative to Pre Recession December 2015 as a Percentage Above (Below) December % 25% 24.6% 20% 15% MS is one of 13 states where the December 2015 employment was below that of December States rank from a high of 24.6% above to a low of 2.9 below. MS is 2.2% below. 10% 5% 0% 2.2% 2.9% 5% ND TX UT DC CO WA AK SD MA NY CA ID SC NE TN IA MN GA OR FL KY OK MD NC IN MT LA DE HI VA VT KS AR MI NH PA WI OH RI AZ CT NJ MO ME WV IL WY MS NM AL NV February 2016 MS University Research Center, IHL 16

17 Wage And Salary Growth, Adjusted for Inflation 60% 16.2% 13.3% 12.5% 12.2% 12.1% 11.6% 10.4% 9.2% 9.0% 9.0% 9.0% 8.2% 8.1% 8.1% 8.1% 8.0% 7.7% 7.6% 7.5% 7.4% 7.3% 7.1% 6.9% 6.8% 6.7% 6.6% 6.5% 6.5% 6.1% 5.8% 5.8% 5.7% 5.5% 5.4% 5.1% 5.1% 5.1% 4.5% 4.4% 4.0% 3.8% 2.8% 2.6% 2.5% 2.0% 1.7% 1.7% 1.6% 1.4% 1.0% 0.6% 49.9% 50% 40% Average growth for the US was 8.0%. MS growth was 1.7%, which ranks us 5 th from the bottom, MS was ahead of WV, AL, VA, and NM. 30% 20% 10% 0% ND TX WA UT CO CA OK OR SD MI MT MA MN FL GA IA US AZ TN OH SC WY ID NC NH NY NE IN DE WI KS AL HI IL NV LA PA RI VT KY MO AR DC CT MD NJ ME MS WV AL VA NM February 2016 MS University Research Center, IHL 17

18 MS Wages and Salaries by Sector $9 $8 $7 $6 $5 $4 $3 $2 $1 $0 Billions of 2004 $$10 Government Trade, Transportation & Utilities Manufacturing Education & Health Services Professional & Business Services Leisure & Hospitality Construction Financial & Related Activities Other Services Natural Resources Information February 2016 MS University Research Center, IHL 18

19 Government Dependence, 2014 Income from Transfer Payments and Government Earnings as a share of Total Personal Income 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% WV MS KY AR NM ME AL SC MI TN VT OR AZ RI FL NC OH IN MO DE PA LA MT ID OK GA NY WI US IA NV AK HI MN WA KS IL CA SD MA NH TX NE NJ MD UT VA CT CO ND WY Transfer Payments Government Earnings February 2016 MS University Research Center, IHL 19

20 MS Index of Leading Indicators The MSLI showed very little upward momentum in late Index 2004= Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 The Mississippi Index of Leading Indicators reflects economic conditions expected for the coming months. The index is constructed by the University Research Center and indexed to There are 7 components of the Index: MS Initial Unemployment Claims; MS Income Tax Withholdings; MS Value of Residential Building Permits; MS MFG Employment Intensity Index, ISM Index of US MFG Activity; US Consumer Expectations Index and US Retail Sales. February 2016 MS University Research Center, IHL 20

21 MS Nonfarm Employment 1,200 1,150 1,161.8 Feb 08 1,135.0 Dec 15 1,100 Thousands 1,050 1, ,084.2 Jan Despite growing since 2010, employment remains almost 27 thousand jobs below the pre recession peak. Annual Job growth has been fairly stable between 0.7% and 0.9% for the past four years. 800 February 2016 MS University Research Center, IHL 21

22 Where are the Jobs? Mississippi added an average 10,075 jobs in 2015 over 2014 Leisure & Hospitality Trade, Transportation & Utilities Professional & Business Activities Education & Health Services Manufacturing Government Financial Activities Information Other Services Mining & Logging Construction 2, ,217 2,300 1,983 1,742 1,683 1, ,000 3,000 2,000 1, ,000 2,000 3,000 4,000 February 2016 MS University Research Center, IHL 22

23 Employment Gained (Lost) By County, Mississippi Added 10,075 (0.9%) -70 Bolivar -60 Coahoma -490 Warren -480 Tunica -40 Quitman -160 Sunflower 20 Leflore -230 Washington -60 Humphreys 20 Sharkey 10 Issaquena 2,700 De Soto 60 Tate 100 Tallahatchie 200 Yazoo -1,210 Madison 1,980 Hinds 140 Panola 40 Holmes 80 Yalobusha 100 Grenada Carroll Montgomery 1,140 Rankin Benton Tippah Marshall 670 Lafayette -60 Attala -70 Leake 290 Scott Calhoun Chickasaw -20 Webster 10 Choctaw 230 Union 260 Pontotoc -140 Winston 150 Neshoba 0 Newton -50 Clay -10 Oktibbeha 320 Alcorn 130Tishomingo Prentiss 310 Lee -130 Monroe 60 Lowndes 50 Noxubee -50 Kemper -670 Lauderdale Itawamba Decline (33 Counties) Less than 150 Jobs Gained (33 Counties) 150 or more Jobs Gained (16 Counties) -80 Adams -50 Claiborne 20 Jefferson 10 Franklin 140 Copiah -10 Lincoln 180 Simpson 50 Smith Covington Jefferson Davis Lawrence -20 Jasper -100 Jones 180 Clarke -80 Wayne -40 Wilkinson 40 Amite 120 Pike Marion Walthall Lamar ForrestPerry 80 Greene -30 Pearl River -150 Hancock 50 Stone -340 Harrison 300 George -1,010 Jackson February 2016 MS University Research Center, IHL 23

24 MS Manufacturing Employment and Hours Worked WW Length Employment Jan 90 Jan 91 Jan 92 Jan 93 Jan 94 Jan 95 Jan 96 Jan 97 Jan 98 Jan 99 Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 Employment, Thousands Hours Worked, 3Month Moving Average MS MFG has proven to be fairly resilient in recent years. After years of decline, employment increased in 2014 and Hours worked have been at a relatively high level as well. We are however beginning to feel the US slowdown. February 2016 MS University Research Center, IHL 24

25 Inflation Adjusted Average Hourly Manufacturing Earnings in Mississippi $15.00 $14.50 $14.00 $13.50 $13.00 $12.50 $12.00 $11.50 $11.00 Mar 05 Jun 05 Sep 05 Dec 05 Mar 06 Jun 06 Sep 06 Dec 06 Mar 07 Jun 07 Sep 07 Dec 07 Mar 08 Jun 08 Sep 08 Dec 08 Mar 09 Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 Mar 14 Jun 14 Sep 14 Dec 14 Mar 15 Jun 15 Sep 15 Dec 15 February 2016 MS University Research Center, IHL 25

26 MS Residential Building Permits Three Month Moving Average Number of Units Permits We finally began to see some upward momentum in Annual average for 2015 was 565 Units, the highest since Graph may understate improvement as permits are not required in the county. Annual Average 3 Month Moving Avg. Construction Emp Employment (000) Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 February 2016 MS University Research Center, IHL 26

27 MS Gaming Revenue $3, % $3, % $2,500 $2,000 $1,500 $1, % 5.0% 0.0% 5.0% $ % $0 15.0% Bar Graph: Millions of Dollars Line Graph: Annual % CHG Coast River Total % CHG Total February 2016 MS University Research Center, IHL 27

28 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Unemployment Claims Three Month Moving Average Initial Unemployment Claims Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Continued Unemployment Claims February 2016 Initial Claims Continued Claims MS University Research Center, IHL 28

29 Year Over Year Growth in Real Personal Income Less Transfer Payments: Mississippi by Quarter 8% 6% 4% 2% 0% 2% 4% 6% 8% Gray Areas Represent National Recessions. Declines are characteristic of recessions. The series showed weakness in 2013 and 2014, but has been positive for four consecutive quarters. February 2016 MS University Research Center, IHL 29

30 MS Withholdings Y/Y Growth By QTR (Not Adjusted for Inflation) 12% 10% 8% 6% 4% 2% 0% 2% 4% 6% Mar 07 Mar 08 Mar 09 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 February 2016 MS University Research Center, IHL 30

31 MS Sales Tax Transfers to the GF Y/Y Growth By QTR (Not Adjusted for Inflation) 15% 10% 5% 0% 5% 10% 15% Mar 07 Mar 08 Mar 09 Mar 10 Mar 11 Mar 12 Mar 13 Mar 14 Mar 15 February 2016 MS University Research Center, IHL 31

32 Economic Outlook of Key Indicators Indicator MS Real GDP 0.0% 1.0% 1.9% 2.2% US Real GDP 2.4% 2.4% 2.4% 2.8% MS Employment (Est. Based) 0.7% 0.9% 1.0% 0.9% US Employment (Est. Based) 1.9% 2.1% 1.7% 1.3% MS Real Total Personal Income 1.6% 2.6% 2.5% 2.2% US Real Total Personal Income 3.0% 4.2% 3.1% 3.1% February 2016 MS University Research Center, IHL 32