Economic Outlook for New England Dr. Jeffrey Thompson Director, Senior Economist and Policy Advisor New England Public Policy Center Connecticut Power and Energy Society The Future of Energy: What s the Deal? Disclaimer: The views expressed here are those of the speaker and do not necessarily represent the views of the Federal Reserve Bank of Boston or the Federal Reserve System.
About the Boston Federal Reserve Bank Federal Reserve System Board of Governors (Washington., DC) Regional Fed banks (12, including Boston) Conducts monetary policy, bank supervision NEPPC Produces research that informs public policy in New England Recent issues: opioid epidemic, affordable housing, criminal records reform 2
State Coincident Economic Activity Indexes 1.50 1.40 Indexed to Pre-Recession Peaks 1.30 1.20 1.10 1.00 0.90 0.80 Recession US CT ME MA NH RI VT 0.70 0.60 Aug-04 Aug-06 Aug-08 Aug-10 Aug-12 Aug-14 Aug-16 Aug-18 Source: Federal Reserve Bank of Philadelphia, NBER, Haver Analytics 3
Real GDP Per Capita.8.85.9.95 1 1.05 1.1 CT ME MA NH RI VT US 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Year Source: Bureau of Economic Analysis, Haver Analytics 4
Non-Agricultural Employment 1.15 1.10 Indexed to Pre-recession Peaks 1.05 1.00 0.95 0.90 0.85 Recession CT ME MA NH RI VT US 0.80 Sep-04 Sep-06 Sep-08 Sep-10 Sep-12 Sep-14 Sep-16 Sep-18 Source: Bureau of Labor Statistics, NBER, Haver Analytics 5
Employment Growth by Industry Percent Change, August 2017 - August 2018 Construction 4.0 6.8 Leisure & Hospitality 1.6 4.0 Professional & Business Services 2.6 3.4 Manufacturing 2.0 2.4 Other Services 1.6 1.7 Education & Health 1.6 2.1 Wholesale Trade 1.1 1.6 Transportation, Warehousing, and Utilities 0.6 2.9 Finance 0.5 1.3 Retail Trade -0.2 0.4 Government -0.6 0.2 Information -0.8-1.2 US NE Source: Bureau of Labor Statistics, Haver Analytics -2 0 2 4 6 8 Percentage 6
Unemployment Rates 12 10 Percentage 8 6 4 Recession NE US 2 0 Sep-04 Sep-06 Sep-08 Sep-10 Sep-12 Sep-14 Sep-16 Sep-18 Sep-17 Sep-18 United States 4.2 3.7 New England 3.7 3.6 Connecticut 4.5 4.2 Maine 3.3 3.3 Massachusetts 3.6 3.6 New Hampshire 2.6 2.7 Rhode Island 4.5 3.9 Vermont 2.9 2.9 Source: Bureau of Labor Statistics, NBER, Haver Analytics 7
Unemployment Rates in New England by Metropolitan Areas VT RI NH MA ME CT Bridgeport-Stamford-Norwalk Danbury Hartford-West Hartford-East Hartford New Haven Norwich-New London-Westerly Waterbury Bangor Lewiston-Auburn Portland-South Portland Barnstable Town Boston-Cambridge-Nashua Leominster-Gardner New Bedford Pittsfield Springfield Worcester Dover-Durham Manchester Portsmouth Providence-Warwick Burlington-South Burlington 2.4 2.5 2.7 2.6 2.4 2.4 8 2.5 2.4 2.6 2.7 3.3 3.4 3.4 3.1 3.3 3.3 3.4 3.9 3.7 3.7 3.9 3.9 4.0 3.8 4.0 4.5 4.5 4.4 4.3 4.4 4.2 4.4 4.3 4.4 4.4 4.5 4.4 4.6 5.0 5.6 5.6 5.5 0 1 2 3 4 5 6 Source: Bureau of Labor Statistics, Haver Analytics, Federal Reserve Bank of Boston Aug-17 Aug-18
Initial Claims for Unemployment Insurance 2.0 1.8 1.6 Indexed to Average of 1995 1.4 1.2 1.0 0.8 0.6 Axis Title Recession NE US 0.4 0.2 0.0 Sep-04 Sep-06 Sep-08 Sep-10 Sep-12 Sep-14 Sep-16 Sep-18 Source: Department of Labor, NBER, Haver Analytics, Federal Reserve Bank of Boston 9
Consumer Price Index 8 6 Percent Change from Year Earlier 4 2 0 Recession US Boston -2-4 Sep-04 Sep-06 Sep-08 Sep-10 Sep-12 Sep-14 Sep-16 Sep-18 Source: Bureau of Labor Statistics, NBER, Haver Analytics 10
Components of the Consumer Price Index Percent Change, September 2017 - September 2018 All Items 2.3 3.3 All Items, Less Food and Energy 2.2 3.1 Fuel & Utilities 0.5 4.6 Shelter 3.3 4.6 Transportation 3.7 3.9 Education and Communication 1.2 2.9 Food 1.4 2.7 Medical Care Recreation 0.2 0.3 1.2 1.7 US Boston Source: Bureau of Labor Statistics, Haver Analytics 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5 11
Repeat-Sales Home Price Index 15 10 Percent Change from Year Earlier 5 0-5 -10 Recession US FHFA Purchase-Only NE FHFA Purchase-Only US S&P Case-Shiller -15 Q2-04 Q2-06 Q2-08 Q2-10 Q2-12 Q2-14 Q2-16 Q2-18 Source: FHFA, NBER, S&P/Case-Shiller, Haver Analytics 12
House Price Changes in New England Metropolitan Areas Percent Change, Q2 2017 - Q2 2018 Bridgeport-Stamford-Norwalk 2.0 VT RI NH MA ME CT Hartford-W. Hartford-E. Hartford New Haven-Milford Norwich-New London Bangor Lewiston-Auburn Portland-S.Portland-Biddeford Barnstable Town Boston-Cambridge-Quincy Pittsfield Springfield Worcester Manchester-Nashua Providence-New Bedford-Fall River Burlington-S. Burlington 2.2 2.9 3.3 4.4 4.3 5.0 5.5 5.9 6.4 7.1 6.9 6.8 7.1 7.5 0 1 2 3 4 5 6 7 8 Single Family Homes Source: Freddie Mac Home Loan Mortgage Corporation, Haver Analytics 13
Consumer Confidence 160 140 Indexed to U.S. Average of 1985 120 100 80 60 40 Recession US NE 20 0 Sep-04 Sep-06 Sep-08 Sep-10 Sep-12 Sep-14 Sep-16 Sep-18 Source: The Conference Board, NBER, Haver Analytics 14
NEEP Forecast for New England Source: New England Economic Partnership, Fall Forecast, November 2017. 15
State Susceptibility to Fiscal Distress in Recession Source: S&P Global Market Intelligence; When the Credit Cycle Turns, U.S. States May be Tested in Unprecedented Ways 16
New England States on U.S. News Top Ten List Source: U.S. News and World Report: https://www.usnews.com/news/best-states/rankings 17
Net Migration Rates in New England Rate per Thousand Persons -10-8 -6-4 -2 0 2 4 6 8 10 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 Time Source: Census Bureau/Haver Analytics Net Domestic Net International Net Total 18
Thank You Dr. Jeffrey Thompson Director, Senior Economist and Policy Advisor Jeffrey.Thompson@bos.frb.org