More than 300 South Sound business, community and economic development leaders gathered at Little Creek Hotel & Casino today for the annual Regional Forecast and Innovation Expo.
Regional economist Bill Conerly, Ph.D., told the crowd that our marketplaces — local, regional, national and globally — are in sound shape, with GDP growth meeting the long-term trend, especially over the past two quarters.
“Having said that, we are not performing up to our potential,” Conerly added, because our population growth is very slow. He pointed to much less immigration being shown in the United States in recent times, and there is a discernible a pattern of lower birth rates among millennials compared to past generations.
The economist expects there will be a modest pullback in consumer spending as we go into 2018, continuing a weakness that shows up in 2017.
“This is because we continued to spend in 2016 into early 2017, even when we were not seeing personal income growth.”
Other major economic trends and their causes are:
– Housing starts will be moderating longer term as the population growth lines slow down.
– Business capital spending will be relatively firm in the two years ahead, in part because company profits are strong and there likely will be some corporate tax relief.
– GDP trends continue upward
Conerly does not see a recession in our future through 2018 or 2019, except like any skilled economist who has learned to hedge his bets on forecasts, he says “there is a 15 percent chance of recessionary effects in that period, if unforeseen things occur.”