Economic Outlook 2016 National Trends Focus on San Diego 32 nd Annual - PowerPoint PPT Presentation

Economic Outlook 2016 National Trends Focus on San Diego 32 nd Annual San Diego Economic Roundtable January 14, 2016 Marney Cox, Dir. Capital Projects San Diego Association of Governments

2015…What Happened? • Expected • New, Improved GDP Growth • Labor Market Tightening • Fed Raise Interest Rates • Unexpected Surprises • Same Old GDP Growth • Falling oil prices/interest rates/inflation • Currency Devaluations • Emerging Trends • US Economy ‐ Tallest Pigmy • Stronger Dollar/ Global Weakness • Commodity Price Deflation • Range Bound Interest Rates

US Economy…Three Positive Trends US Annual Job Change Monthly Retail Sales Personal Savings Rate M$ 2000…………….2015 2000…………….2015 2000…………….2015

US Economy…Three Lingering Challenges… Slow Growth ‐ Distressed Workers ‐ Stagnate Wages Distressed Real Weekly Wages GDP Gap Workers (000) Index 2004=100 • 1 Potential GDP 107 106 Trillion$ Gap 105 U 104 103 102 PT-E Actual GDP 101 100 LT-U 99 98 D 97 25% 75% median 2004 2014 2000 2014 2007 2014

2016 Outlook for San Diego

SD Job Growth and Hourly Earnings Annual Jobs Change SD Hourly Earnings Change (Index 2002=100) 60,000 4.0% 150 40,000 2.0% 20,000 140 0.0% 0 JOBS 130 ‐ 20,000 ‐ 2.0% ‐ 40,000 120 ‐ 4.0% ‐ 60,000 110 ‐ 80,000 ‐ 6.0% 2007 2009 2011 2013 2015 SD Annual Emp Change 100 2002 2004 2006 2008 2010 2012 2014 SD Emp pct cng US Emp pct cng 10th percentile Median 90th

SD Leading the US Payroll Job Growth (12/07=100) Unemployment Rate (SAAR) U.S. U.S. 2002 2015 2005 2015

SD Not All Industries Have Fully Recovered 81,900 Net Job Increase Dec 07 ‐ Nov 15 Thousands of Jobs ‐ 20 ‐ 10 0 10 20 30 40 50 60 Construction Manufacturing Trade, Trans & Util Information Financial Activities Prof & Bus Services Educational & Health Services Leisure & Hospitality Other Services Government

SD Created 6 More Low than High Paying Private Sector Jobs Unbalanced Job Growth Affects Distribution of Wages 1990-2011 Growth Average Salary Real Salary Increase Growth Job Growth Compensation Category / Median ($2011) ’90-’11 1990-2011 Wage ($2011) Highest Paying Jobs (Top 1/3) / $83,000 $23,000 38.0% 34,200 Mid Level Paying Jobs (Middle 1/3) / $48,200 $5,400 13.0% 85,500 Low Level Paying Jobs (Lowest 1/3) / $25,500 $3,200 14.0% 222,500 9

SD Housing Permits & Prices C ‐ S Home Price Index Housing Permits (2000=100) 300.00 Single Family Permits Multi ‐ Family Permits 20000 $538K $536K 18000 250.00 $460K 16000 14000 200.00 Index 2000 = 100 NOV 15 12000 Permits 10000 150.00 8000 6000 100.00 4000 2000 50.00 0 2000 2003 2006 2009 2012 2015 0.00 2000 2015 2000 2015

CA Housing Supply Demand Supply Not Keeping Pace With Demand 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Less Affordable Share of Housing Permits Median Income/Price Share of Population

SD Total Taxable Sales Annual B$ Annual Percent Change SD Region Taxable Sales $60 10.0% $50 5.0% $40 Billions $30 0.0% $20 ‐ 5.0% $10 ‐ 10.0% $0 2000 2003 2006 2009 2012 2015 2000 2003 2006 2009 2012 2015

SD Venture Capital Funds Resources for High Tech Jobs, M$ per Year & % of Total SD Annual VC Funds (Ave. $1.1B) $2,500 7% (AVE. 3.4%) SD VC as percent of total 6% $2,000 5% $1,500 4% 1H15 3% $1,000 2% $500 1% $0 0% 1998 2002 2006 2010 2014

SD Trade with Mexico Thru Otay Mesa ($35B in 2013; 6% CAGR) $40 $35 $30 $25 Billions $ $20 $15 $10 $5 $0 1998 2000 2002 2004 2006 2008 2010 2012 exports imports

SD Forecast 2016 Indicator 2013 2014 2015 2016 Total Population 3,154,574 3,192,457 3,227,496 3,268,500 Growth (%) 0.7 1.2 1.1 1.3 Unemployment Rate( Dec. %) 6.8 5.5 5.1 4.8 Payroll Employment (Dec. yoy) 1,347,400 1,378,400 1,416,200 1,451,200 Growth (% yoy) 2.6 2.3 2.7 2.5 Jobs 34,700 31,000 37,800 35,000 Median Home Price(Aug) $412,000 $434,000 $459,000 $481,000 Growth (%) 13.4 5.5 5.8 5.0 Residential Permits 8,264 6,874 8,500 9,000 Single Family Permits 2,564 2,486 2,975 3,150 (% SF) 31 36 35 35 Multi ‐ Family Permits 5,700 4,388 6,150 7,350 (% MF) 69 64 65 65 Taxable Sales ($ Millions) $49,444 $51,100 $52,900 $54,700 Growth (%) 4.3 3.3 3.5 3.5

Economic Outlook 2016 National Trends Focus on San Diego 32 nd Annual San Diego Economic Roundtable January 14, 2016 Marney Cox, Dir. Capital Projects San Diego Association of Governments