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Montgomery County Chamber of Commerce . The Outlook for the U.S. and Washington Area Economies In 2013 and Beyond. Stephen S. Fuller, Ph.D. Dwight Schar Faculty Chair and University Professor Director, Center for Regional Analysis George Mason University. November 13, 2013. - PowerPoint PPT Presentation
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Montgomery County Chamber of Commerce
November 13, 2013
The Outlook for the U.S. and Washington Area Economies
In 2013 and BeyondStephen S. Fuller, Ph.D.
Dwight Schar Faculty Chair and University Professor Director, Center for Regional Analysis
George Mason University
The U.S. Economy:Recent Performance and Outlook
The National Economic Climate Four Years Into the Recovery
Head Winds• The sequester• Weaker growth in emerging markets is hurting
manufacturing (exports)• Business is cautious re: hiring and capital spendingThe Sequester and Shutdown• $85b reduction in budget authority• $44b in actual spending reductions in FY 2013• $66b in spending reductions in calendar year 2013• Spending cuts lag cuts in budget authority
The National Economic Forecast • Sequester and payroll tax increases in January may
reduce overall GDP growth in 2013 by 1 percentage point.
• DoD spending down 7% in 2013; up 0.8% in 2014• Non-DoD spending down 5.9% in 2013; up 0.4% in
2014.• Sequester replaced in FY 2014 Budget agreement
plus tax increases (caps on deductions) and entitlement reductions beginning in January 2014.
• GDP in 2013 = 1.5%; in 2014 = 2.5%• GDP in 2015 = 3.2%
20012002
20032004
20052006
20072008
20092010
20112012
2013
-8000
-6000
-4000
-2000
0
2000
4000
Annual Change in Payroll Jobs – USMonth-Over-Year
(000s)
Oct =+ 2.3 M
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
U.S. Payroll Job Change by SectorOct 2012 – Oct 2013
InformationFederal Govt.
Transp. & Util.Other Services
Wlse TradeConstruction
FinancialManufacturing
Leisure & Hosp.Retail Trade
Prof. & Bus. SvcsState & Local Govt
Educ & Health Svcs
-600 -400 -200 0 200 400 60017
-9455
3985
23193
55444
368644
68325
(000s) Total = 2,329Ranked by Size in 2013
Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis
U.S. Payroll Job Change by SectorSep 2013 – Oct 2013
InformationFederal Govt.
Transp. & Util.Other Services
Wlse TradeConstruction
FinancialManufacturing
Leisure & Hosp.Retail Trade
Prof. & Bus. SvcsState & Local Govt
Educ & Health Svcs
-100 -80 -60 -40 -20 0 20 40 60 80 1005
-120
6-5
167
1953
4444
423
(000s) Total = 204Ranked by Size in 2013
Source: Bureau of Labor Statistics (Seasonally Adjusted), GMU Center for Regional Analysis
Oct-05
Oct-06
Oct-07
Oct-08
Oct-09
Oct-10
Oct-11
Oct-12
Oct-13
456789
1011
U.S. Unemployment Rate
Source: Bureau of Labor Statistics (Seasonally Adjusted), IHS Global Insight October 8, 2013
Oct = 7.3
%
GI FCST13 – 7.514 – 7.115 – 6.516 – 6.017 – 5.718 – 5.4
2007 3
2008 3
2009 3
2010 3
2011 3
2012 3
2013 3
2014 3
2015 3
-10
-8
-6
-4
-2
0
2
4
6
U.S. Gross Domestic ProductQuarterly Change: 2007 – 2015
% Forecast > > > >
Source: Bureau of Economic Analysis, Global Insight October 8, 2013
Federal Spending Trendsin the Washington Area
2010 Structure of the Greater Washington Economy
Local ServingActivities 34.8%
Non-LocalBusiness 12.0 %
TotalFederal 39.8%
Procurement 19.1%
Assn 1.8% Hosp. 2.1%
Int’l 3.5%O
ther
1.5
%
Other Federal 10.7 %
Health/Ed.
4.5%
Fed Wages & Salaries 10.0%
Source: GMU Center for Regional Analysis
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
0
10
20
30
40
50
60
70
80
90
Federal Procurement in theWashington Metro Area, 1980-2012
$ Billions
| < 80-90 = $96.5 B > | < 91-00 = $207.9 B >| < 01–10 = $563.5 B > |
TOTAL = $1,023.5 Billion
Source: US Census, Consolidated Federal Funds Report
2011
$80.0 B$75.6 B
2012
Professional & Business ServicesWashington MSA
20022005JanA
prJulO
ctJanA
prJulO
ctJanA
prJulO
ctJanA
prJulO
ctJanA
prJulO
ctJanA
prJul
-20-15-10
-505
1015202530
(000s) Annual Data Annual Month over Year
2008 2009 2010 2011 2012 2013
Tot 2012 = 702,300Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
1950
1953
1956
1959
1962
1965
1968
1971
1974
1977
1980
1983
1986
1989
1992
1995
1998
2001
2004
2007
2010
150
200
250
300
350
400
Federal Employment in theWashington Metro Area, 1950-2012
000s Eisenhower Kennedy – Johnson
Nixon - Ford
Carter Reagan Bush 1 Clinton Bush 2
- 5
+ 74
+ 35+ 17 0 -8.6
- 37 + 24
Obama
+17.5
Source: US Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Federal GovernmentWashington MSA
20022005JanA
prJulO
ctJanA
prJulO
ctJanA
prJulO
ctJanA
prJulO
ctJanA
prJulO
ctJanA
prJul
-20-15-10
-505
1015202530
(000s) Annual Data Annual Month over Year
2008 2009 2010 2011 2012 2013
Tot 2012 = 377,400Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Summary for Federal Spending Trends in the Washington Metropolitan Area, 2010-2013
• Federal procurement outlays declined 8.4% between FY 2010 and FY 2012 and are projected to decline 5.0% during FY 2013.
• Federal employment has declined by 13,600 or by 3.5% in 24 months between July 2011 and 2013.
• Federal payroll declined by 0.6% between FY 2010 and FY 2011, was flat during FY 2012 and is projected to decline by $2 billion in FY 2013; it will continue to decline slowly as the workforce shrinks (-16,100 federal jobs between 2013 and 2017) and as older workers retire and are replaced by younger workers.
Federal Budget Trends and Outlook (dollars in billions)
Year Annual % Change Budget Deficit
2008 6.8 - $454.8 2009 5.7 -1,415.7 2010 4.3 -1,294.22011 - 2.6 -1,296.8 2012 - 1.4 -1,089.2 2013 - 4.9 - 701.0 2014 0.3 -730.7
2015 - 0.6 - 644.4
2016 - 1.2 -596.7 2017 - 0.6 - 638.52018 - 0.4 - $670.6Source: IHS Global Insight “US Executive Summary” October 8, 2013
Federal Spending Trends in theWashington Metropolitan Area: 2010-2017
(in billions of current dollars)
Year GRP %Change* Fed $s % GRP Procurement 2010 $425.0 3.0 $169.0 39.8 $82.5 2011 433.7 2.6 168.2 38.8 80.0 2012 447.9 2.4 165.6 37.0 75.6 2013 466.9 2.1 162.7 34.8 71.8 2014 489.8 3.0 161.1 32.9 70.0 2015 517.2 3.6 162.7 31.4 69.3 2016 544.1 3.3 164.3 30.2 69.0 2017 $ 571.8 3.2 $166.8 29.2 $68.6 *real (inflation adjusted) percent change
Source: GMU Center for Regional Analysis
The Washington Economy:Recent Performance and Outlook
Annual Job ChangeWashington MSA, 2002-2013
200220052008
-80-60-40-20
020406080
100(000s) Annual Data Annual Month over Year
2009 2010 2011 2012 2013
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
WMSA Payroll Job Change: Private SectorThe Great Recession and Recovery To Aug 2013
Transp. & Util.
Wlse Trade
Manufacturing
Information
Financial
Other Services
Construction
Leisure & Hosp.
Retail Trade
Educ & Health Svcs
Prof. & Bus. Svcs
-80 -60 -40 -20 0
-3
-7
-12
-14
-10
-6
-55
-11
-1
0
-12
(000s)
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Series1
0 10 20 30 40 50 60 70 80
0
0
0
0
10
8
7
38
18
48
34Total -131 Total 165
Washington Metropolitan Area Job Change by Wage Category between 2008 to 2013
Lower Wage
Mid-Wage
Higher-Wage
(60,000) (40,000) (20,000) 0 20,000 40,000 60,000 80,000
2008-2009 2010-2013 Sources: EMSI Total Employment, 2013.3 & GMU Center for Regional Analysis
15 Largest Job MarketsJob Change: Aug 2012 – Aug 2013
New York
Los Angeles
Chicago
DallasDC Houston
Philadelphia
Boston
Atlanta
Miami
SF-Oakland
Detroit
Minneapolis
Seattle
Phoenix
020406080
100120140160180200
(000s)
Washington +33,400
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorAug 2012 – Aug 2013
Washington MSA
Transp. & Util.Wlse Trade
ManufacturingInformation
FinancialOther Services
ConstructionLeisure & Hosp.
Retail TradeState & Local Govt
Educ & Health SvcsFederal Govt.
Prof. & Bus. Svcs
-20 -15 -10 -5 0 5 10 15 20 25 30-2
0-1
-28
2-2
126
99
-71
(000s) Total = 33,400
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorJul 2013 – Aug 2013
Washington MSA
Transp. & Util.Wlse Trade
ManufacturingInformation
FinancialOther Services
ConstructionLeisure & Hosp.
Retail TradeState & Local Govt
Educ & Health SvcsFederal Govt.
Prof. & Bus. Svcs
-20 -15 -10 -5 0 5 10 15 20 25 30-1
0-1-1
000
-2-1
-13-1
-2-5
(000s) Total = -26,500
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Annual Job ChangeDistrict of Columbia, 2002-2013
200220052008
-40-30-20-10
0102030405060
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012 2013
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorJul 2013 – Aug 2013 District of Columbia
Transp. & Util.Wlse Trade
ManufacturingInformation
FinancialOther Services
ConstructionLeisure & Hosp.
Retail TradeState & Local Govt
Educ & Health SvcsFederal Govt.
Prof. & Bus. Svcs
-20 -15 -10 -5 0 5 10 15 20 25 3000
00
00
000
-10-1
0-2
(000s) Total -13,800
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Annual Job ChangeSuburban Maryland, 2002-2013
200220052008
-40-30-20-10
0102030405060
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012 2013
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorJul 2013 – Aug 2013Suburban Maryland
Transp. & Util.Wlse Trade
ManufacturingInformation
FinancialOther Services
ConstructionLeisure & Hosp.
Retail TradeState & Local Govt
Educ & Health SvcsFederal Govt.
Prof. & Bus. Svcs
-20 -15 -10 -5 0 5 10 15 20 25 300
00
00
00
-10
00
00(000s) Total -1,800
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Annual Job ChangeNorthern Virginia, 2002-2013
200220052008
-40-30-20-10
0102030405060
(000s) Annual Data Annual Month over Year
2009 2010 2011 2012 2013
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Job Change by SectorJul 2013 – Aug 2013
Northern Virginia
Transp. & Util.Wlse Trade
ManufacturingInformation
FinancialOther Services
ConstructionLeisure & Hosp.
Retail TradeState & Local Govt
Educ & Health SvcsFederal Govt.
Prof. & Bus. Svcs
-20 -15 -10 -5 0 5 10 15 20 25 300
000
000
-10
-20
0-3
(000s) Total -5,800
Source: Bureau of Labor Statistics (Not Seasonally Adjusted), GMU Center for Regional Analysis
Aug-06
Aug-07
Aug-08
Aug-09
Aug-10
Aug-11
Aug-12
Aug-13
0
2
4
6
8
10
12
8.5 – DC
7.3 – U.S.
5.9 – SMD
5.4 – MSA
4.4 - NVA
Unemployment Rates in the WMSABy Sub-State Area, 2006-2013
Source: Bureau of Labor Statistics (Region - Not Seasonally Adjusted, US – Seasonally Adjusted)
Job Growth in the Washington Metropolitan Area:
2012 - 2017
Washington Metropolitan Area
Gross Regional Product, 2012-2022 (in billions of 2005$s)
Region 2012 Share 2022 Share % Change Metro $386.3 100.0 $513.5 100.0 32.9 District 92.1 23.8 114.5 22.2 23.7 SubMD 110.6 28.6 145.9 28.4 32.0 NoVA 182.5 47.2 251.1 48.9 37.6 __________________________________________ Source: IHS Global Insight, GMU Center for Regional Analysis The Washington metropolitan area includes Jefferson County, WV and is included in the total GRP values.
Washington Metropolitan Area andSuburban Maryland, Change in Jobs,
Summary: 2012-20172012 – 2017 Year Total Jobs Net New
(% Change)Replacement(% Change)
Openings(% Change)
2012 3,927,775
2012 – 2017 4,291,969364,194 477,530 841,724
9.3% 12.2% 21.4%
Sub-MD2012 – 2017
1,293,9741,377,577
83,583 163,507 247,090
6.5% 12.6% 19.1%
Sources: EMSI Total Employment - 2013.2, GMU Center for Regional Analysis
Suburban Maryland Change in All Jobs, 2012 – 2017
Occupation 2-Digit SOC Net New ReplacementsBusiness & Financial 11,999 9,668 Healthcare (All) 11,980 8,974Personal Care & Service 8,730 7,479 Sales & Related 7,361 25,665Building & Grounds Maint. 7,119 5,321 Food Prep & Serving 6,767 14,846 Educ., Training & Library 5,532 8,233 Management Occupations 4,988 11,360 Arts, Design, Entertainment 3,476 5,976Construction & Extraction 3,079 8,117 All Others 12,552 57,868 Totals, All 83,583 163,507Sources: EMSI Total Employment - 2013.2, GMU Center for Regional Analysis
Suburban Maryland Major Sources of Net New Jobs, 2012 – 2017
Sources: EMSI Total Employment - 2013.2, GMU Center for Regional Analysis * % Total of All Net New Jobs
5-Digit SOC Net New % Total % Change
Business & Financial 11,999 14.4 12.4Personal Financial Advisors 3,220 26.8 31.5Management Analysts 3,076 25.6 16.8Accountants & Auditors 991 8.3 7.2Business Ops Specialists 941 7.8 7.6
Healthcare (All) 11,980 14.3 12.7Home Health Aides 2,677 22.3 30.4Registered Nurses 1,754 14.6 13.0Nursing Aides,Orderlies 1,405 11.7 12.6Massage Therapists 589 4.9 20.9
All Others 59,604 71.3 1.9Total 83,583 100.0 6.5
Suburban Maryland Major Sources of Net New Jobs, 2012 – 2017
Sources: EMSI Total Employment - 2013.2, GMU Center for Regional Analysis * % Total of All Net New Jobs
5-Digit SOC Net New % Total % Change
Personal Care & Service 8,730 10.4 14.2Personal Care Aides 2,089 23.9 25.4Hairdressers Cosmetologists 1,436 16.4 20.0Childcare Workers 1,140 13.1 7.8Fitness Trainers & Instructors 649 7.4 16.9
Sales & Related 7,361 8.8 4.5Real Estate Sales Agents 3,837 52.1 12.6Financial Services Agents 2,035 27.6 27.8Real Estate Brokers 725 9.8 11.8Cashiers 485 6.6 1.8
All Others 67,492 80.7 6.5Total 83,583 100.0 6.5
2017 Structure of the Greater Washington Economy
Local ServingActivities 37.8%
Non-LocalBusiness 16.2 %
TotalFederal 29.2%
Procurement 12.0%
Assn 1.9 %
Hosp. 2.6%
Int’l 3.9%
Other 1.5%
Other Federal 9.7 %
Health/Ed.
7.0 %
Fed Wages & Salaries 7.5 %
Source: GMU Center for Regional Analysis
Thank You Questions
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