2017 Economic Outlook Its not 2016 anymore.. Ra Ray Ma Major Chief - - PowerPoint PPT Presentation

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2017 Economic Outlook Its not 2016 anymore.. Ra Ray Ma Major Chief - - PowerPoint PPT Presentation

Aug 06, 2023 595 likes •822 views

2017 Economic Outlook Its not 2016 anymore.. Ra Ray Ma Major Chief Economist Jan 5, 2017 1 Y EAH , BUT WHAT ABOUT . Trumponomics 2 Economists Warn of Global Recession Following Trump Victory Martha C. White Money

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SLIDE 1

2017 Economic Outlook

1

Ra Ray Ma Major

Chief Economist

Jan 5, 2017

It’s not 2016 anymore……..

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SLIDE 2

2

Trumponomics

YEAH, BUT WHAT ABOUT ……….

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SLIDE 3

3

Economists Warn of Global Recession Following Trump Victory

  • Martha C. White Money Magazine

Updated: Nov. 9, 2016 10:19 AM

Trump Administration to Rev Up Global Growth, Says OECD

The OECD has revised its U.S. and global economic outlooks to reflect the projected effects of a Trump administration. By Andrew Soergel | Economy Reporter Nov. 28, 2016, at 10:35 a.m.

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SLIDE 4
  • Personal Tax Cuts
  • Corporate Tax Cuts
  • Infrastructure Programs
  • Defense Spending
  • Build up the Military
  • Repeal/Modify Obama Care
  • Relax Regulations – Energy, Environment, Financial Policy
  • Trade
  • Immigration
  • Foreign Policy
  • Drain the Swamp
  • Build the wall (now with doors)

4

Trumponomics

What is:

“It takes time, It takes consensus”

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SLIDE 5

= Fiscal Stimulus

Fiscal Stimulus

Employment Unemployment National Debt Inflation Interest Rates

= Tax Cuts + Spending

Trumponomics

GDP Growth

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SLIDE 6

Employment Unemployment National Debt Inflation Interest Rates GDP Growth +3%

National Forecast for 2017/ 2018

+2% +2% +3% $1 Trillion 4.5% +2% A massive fiscal stimulus on any economy that is at or near full employment will lead to more growth, higher levels of inflation and higher interest rates and then …….

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SLIDE 7

San Diego Outlook: Job Jobs

7

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SLIDE 8

San San Di Diego ego Total Employment 2000‐2016

1,150,000 1,200,000 1,250,000 1,300,000 1,350,000 1,400,000 1,450,000

Jan‐00 Apr‐00 Jul‐00 Oct‐00 Jan‐01 Apr‐01 Jul‐01 Oct‐01 Jan‐02 Apr‐02 Jul‐02 Oct‐02 Jan‐03 Apr‐03 Jul‐03 Oct‐03 Jan‐04 Apr‐04 Jul‐04 Oct‐04 Jan‐05 Apr‐05 Jul‐05 Oct‐05 Jan‐06 Apr‐06 Jul‐06 Oct‐06 Jan‐07 Apr‐07 Jul‐07 Oct‐07 Jan‐08 Apr‐08 Jul‐08 Oct‐08 Jan‐09 Apr‐09 Jul‐09 Oct‐09 Jan‐10 Apr‐10 Jul‐10 Oct‐10 Jan‐11 Apr‐11 Jul‐11 Oct‐11 Jan‐12 Apr‐12 Jul‐12 Oct‐12 Jan‐13 Apr‐13 Jul‐13 Oct‐13 Jan‐14 Apr‐14 Jul‐14 Oct‐14 Jan‐15 Apr‐15 Jul‐15 Oct‐15 Jan‐16 Apr‐16 Jul‐16 Oct‐16

Total, All Industries

Peak (Dec-07) Recovery (Jun-14) Trough (Jan-10)

78 months Recovery from the Great Recession took six times longer than the average recovery, now 7 years into an expansion. 70% of job creation was from low‐paying jobs

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SLIDE 9

Government Military Health & Soc. Assist Education Retail/Wholesale Trade & Other Services FIRE, Prof, Info Manufacturing Construction Tourism Innovation

10% 8% 9% 7% 16% 12% 16% 5% 4% 11%

  • Transport. and Util.

2%

SAN DIEGO 2017: Diverse and Expanding Economic Base

Traditional Sectors Supporting Sectors Driving Sectors

30% 30% 27% 43%

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SLIDE 10

60 70 80 90 100 110 120 130 140

1 2 3 4 5 6 7 8 2012

San San Di Diego ego, Employment: Driving Sectors

+12 +14 +15

 Years since last peak (2007) 

2007 Peak 2010 Trough 2014 Recovery

Index 2007=100

Innovation Tourism Military

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SLIDE 11

60 70 80 90 100 110 120 130 140

1 2 3 4 5 6 7 8

2011

San San Di Diego ego, Employment: Supporting Sectors

+34 +11 +4

 Years since last peak (2007) 

2007 Peak 2010 Trough 2014 Recovery

Index 2007=100

Government Health Care &

  • Soc. Assis.

Education

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SLIDE 12

FIRE, Prof, Info

60 70 80 90 100 110 120 130 140

1 2 3 4 5 6 7 8 2015  Years since last peak (2007) 

2007 Peak 2010 Trough 2014 Recovery

Index 2007=100

San San Di Diego ego, Employment: Traditional Sectors

+1 Retail/Wholesale Trade & Other Serv. Manufacturing ‐5 Construction ‐16 ‐20 ‐2Tran. & Util.

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SLIDE 13

Government Military Health &

  • Soc. Assis.

Education

Retail Trade, Wholesale Tr & Other Serv. FIRE, Prof, Info

Manufacturing

Construction

Tourism Innovation

10% 8% 9% 7% 16% 12% 16%

5%

4%

11%

  • Transport. and Util.

2%

San Diego Region, 2017 Select Sector Forecasts

Economic Drivers:

Innovation sector continues to thrive. Travel and Hospitality will outpace GDP growth in 2017. Military expands its strong presence.

Population‐Driven Sectors:

Health Care grows as population ages. Education remains stable. Government grows proportional to population.

Other Economic Sectors:

Retail trade Brick & mortar weak / Increases spending. Financial and Professional very slow growth. Construction and Real Estate strong growth through 2018. Manufacturing continues steady recovery.

Employment: 40,000 new jobs (2.7% growth) Unemployment: drops below 4.5%

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SLIDE 14

San Diego Outlook: Wa Wages

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San San Di Diego ego Coun County ty Wages

100 105 110 115 120 125 130 135 140 145 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

25th Median 75th

Nominal Hourly Wages

Index: 2004 = 100

+23% +18% +16%

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SLIDE 16

San San Di Diego ego Coun County ty Wages

98 100 102 104 106 108 110 112 114 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

25th Median 75th

Real Hourly Wages

Index: 2004 = 100

+5.7% +1.3% +0%

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  • Skilled (Visa program) vs nonskilled workers
  • Wages increase to induce workers to move to

California domestically

  • Growth in real wages up 2% in 2017, 2.5% in 2018
  • Deportations/ The Wall
  • Impact on Central/Imperial Valley (farming)
  • Increase in wages for documented labor
  • $15 hr minimum wage , might be prevailing wage

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SAN

AN DIE IEGO 2017

2017 OUT

UTLOOK OOK ON ON WAGES AGES

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San Diego Outlook: Housi Housing

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“Housing permits and prices”

50 100 150 200 250 300 01/01/2000 11/01/2000 09/01/2001 07/01/2002 05/01/2003 03/01/2004 01/01/2005 11/01/2005 09/01/2006 07/01/2007 05/01/2008 03/01/2009 01/01/2010 11/01/2010 09/01/2011 07/01/2012 05/01/2013 03/01/2014 01/01/2015 11/01/2015 09/01/2016

2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Single Family Permits Multi‐Family Permits

Q3

SAN

AN DIE IEGO 2016

June 2006 May 2009

  • Sept. 2016

55% SF 66% MF

Permits Issued Housing Prices

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SLIDE 20

0% 10% 20% 30% 40% 50% 60%

Apr-91 Jan-92 Oct-92 Jul-93 Apr-94 Jan-95 Oct-95 Jul-96 Apr-97 Jan-98 Oct-98 Jul-99 Apr-00 Jan-01 Oct-01 Jul-02 Apr-03 Jan-04 Oct-04 Jul-05 Apr-06 Jan-07 Oct-07 Jul-08 Apr-09 Jan-10 Oct-10 Jul-11 Apr-12 Jan-13 Oct-13 Jul-14 Apr-15 Jan-16

Source: California Association of Realtors

46%

San Diego Region, Housing Affordability

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Median Priced Home $557,000 Dual income $79,200

Affordability Index

9% 24%

$433,000 Dual Income $55,300 (all jobs 2015)

  • Avg. Income $55,300

$232,000

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  • Increased demand for housing
  • Prices increase in the short‐term
  • Interest rates increase (mortgages hit 6%)
  • Housing affordability falls below 20%
  • Housing starts soften, possibly decrease
  • Construction employment starts to slows and fails

to get back to pre 2007 levels.

21

SAN

AN DIE IEGO 2017/2018

2017/2018 OUT

UTLOOK OOK ON ON HOUSI OUSING NG

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SLIDE 22

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100% Chance Trump Drives Economy into Depression in 2017

  • Brian Maher Daily Reckoning

Updated: Nov. 18, 2016 10:19 AM

Economists Concur, U.S. Economy Poised to Double Under 8 Years Trump

By Andrew Soergel | Economy Reporter Nov. 28, 2016, at 10:35 a.m.