The 2019 Economic Impact Breakfast was sponsored by PacificSource Health Plans & Brooks Resources.
Photos by Amanda Photographic-View full album here.
Links to the PowerPoint slides from the 2019 Economic Impact Breakfast.
The Bend Chamber’s annual Economic Impact breakfast was once again held on Halloween. That fact alone can have a sense of foreboding for some, but rest assured, there were definitely no tricks. Treats? Possibly, in the form of a favorable outlook for the local economy.
On the national level, according to keynote speaker Dr. Lindsey Piegza of Stifel, Nicolaus & Company, the Federal Reserve Chairman would have us believe that all seems to be looking good, or, “favorable.” But digging into the actual data paints a slightly different picture. Over the past four years, the Fed has raised interest rates nine times for a total of 225 basis points to keep the economy strong. In 2019, however, the Fed cut rates for a third time to around 1.75%. The argument from the Fed was this was insurance to keep the economy rolling as it is slowing down. The issue is that with rates at historically low levels, the Fed doesn’t have much room to play with interest rates to continue to bolster the economy.
The Fed also claims that with the economy in its 11th year of expansion, the outlook continues to be favorable. Dr. Piegza points out that the average GDP growth in 2018 was only 2.5%, which is quite low for the U.S. economy… “Barely chugging along.” In fact, she showed how the average growth rate of 2.3% since the Great Recession was the lowest average growth rate compared to previous recovery periods. Overall, Dr. Piezga claims that with declining trends in consumption and investment, GDP will expectedly slow in the coming quarters and the risk of recession rising in 2020 and beyond.
More locally, renowned economist Damon Runberg of the Oregon Employment Department shared how we’re set up in Bend to be much more “recession resilient” than prior to the Great Recession. Mostly due to the further industry diversification of our local economy, with professional services taking a greater proportion of the mix from tourism/hospitality and construction. Our local unemployment situation seems to be “right sizing” as well. Over the past couple years, the Central Oregon area has seen historically low unemployment rates and an extremely tight labor market. That doesn’t bode well for employers looking to hire the right people with the right skills. With the number of unemployed workers per job ad posted increasing over the past two years, this is an indicator that employers will have more choices and an easier time finding the right candidates with the right skills… at the right time.