Experts at Vectra Bank Economic Event Forecast Accelerated Growth in 2013
Economic Experts from the Vectra Bank Colorado Economic Breakfast in Denver, Boulder and Colorado Springs Agree There is Fuel in the System for More Growth This Year
Denver, CO (PRWEB) February 01, 2013
At Vectra Bank Colorado’s 20th Annual Economic Forecast Breakfast titled “Twenty Years Together–Where We Are & Where We´re Going,” three experts forecast “hopeful” accelerated growth for the economy in Colorado and nationally in 2013.
Five economists with expertise on local, national and global perspectives spoke to more than 1,500 people in Denver, Colorado Springs and Boulder throughout a three-day economic forecast event schedule, January 30-February 1, 2013, and with hundreds watching online via a live webcast. This year´s Denver forecast breakfast featured Mark Snead, President and Economist with RegionTrack; Patricia Silverstein, President of Development Research Partners; and George Feiger, CEO, Contango Capital Advisors, who was also a speaker in the two other markets. Colorado Springs´ event hosted Dr. Fred Crowley, Associate Director and Senior Economist, Southern Colorado Economic Forum; and Boulder featured Dr. Phyllis Resnick, Lead Economist of the newly established Colorado Futures at Colorado State University.
“These forums help us anticipate the future by learning from the past,” said Vectra Bank Colorado President and CEO Bruce Alexander. “Through these forums we are able to add value to our clients by providing insight to the trends and drivers that will impact their financial realities this year.” A few of the predictions for 2013 include:
From Mark Snead, President and Economist with RegionTrack (Denver)
- While not expected to be a break out year, Economist Mark Snead expects 2013 to be a transition year toward more organic growth. He believes “impediments are diminished and there is fuel in the system,” from certain economic unknowns now set and from steady economic recovery resulting in wage and salary job growth up 1.5 percent, personal income growth up 3.3 percent, and retail sales growth up 4.7 percent in 2012. Snead´s GDP growth predictions of 2 percent and labor force growth of 1 percent were right on for 2012.
- Sources of “fuel” for the economy in 2013 include the Federal Reserve, which remains highly accommodative, ensuring an environment for economic growth, questions answered around the presidential elections, which reduces uncertainty around Federal policy. Also, in addition to soft energy prices, households and corporations are seeing higher cash balances and there is a rebound in household net worth. Snead predicts job growth for 2013 at 2.1 percent, approximately a 3 percent increase from 2012.
From Patricia Silverstein, President of Development Research Partners (Denver)
- The Colorado economic recovery is leading the country slightly and more than 20 percent of Colorado businesses are planning on adding employees. Challenges remain though with global economic unease, uncomfortable levels of unemployment and businesses desire for clarity around taxes, healthcare and government spending. These issues will keep economic recovery long and slow according to Silverstein.
- Industry bright spots for business, especially for Colorado in terms of employment, are in the professional and business services sectors. While manufacturing jobs are expected to stay low, for Colorado education and healthcare services are growing industries, along with government, wholesale and retail trade. Personal income numbers are nearly returned to pre-recession levels and even with uncertainty people are spending again, with retail trade sales revenue growth up.
From George Feiger, CEO of Contango Capital Advisors (Denver, Co. Springs, Boulder)
- From an investor perspective Feiger jokingly dubbed the U.S. “the least bad place” and sees the largest impediment to the U.S. economic recovery to be debt. Personal, government and business debt is larger than ever before in history. Also historically, when the country finds itself with this much debt, the crisis has historically been solved through an inflation increase of upwards of 5 percent. Feiger says people should expect structured reforms and inflation going up over the next few years.
- With advancements in technology, Feiger sees continued decreased employment in manufacturing. That means the professional services sector, and especially those people who are continuing education towards Masters Degrees, will achieve the most wealth in the future. This shift in wages and education will widen the income gap even more in this country. Education plays a key role in transitioning those manufacturing employees into professional services and higher pay.
From Dr. Fred Crowley (Colorado Springs)
- Teller County experienced the most population growth of the three counties discussed since 1990 at 86.3 percent. Most of that growth was in place by 2000 with the county growing only 10.9 percent in the last 10 years. El Paso County is growing to the tune of 62.5 percent since 1990, with Pueblo County growing at about half that rate at 31.8 percent. While population has continued to grow in these three counties, permits for single family homes dove in 2008, which greatly increased the new home permit value. Today though, with mortgage rates at their lowest, home sales are increasing at rapid rates.
- Labor force, population and employment have trended up fairly equally in Pueblo and El Paso Counties since 1990, while Teller County saw a spike in population in the late 1990s and flat employment numbers since 2000. El Paso County is the strongest county in manufacturing jobs, but manufacturing has been steadily decreasing in all three counties. With manufacturing down, there has been a big jump in health care and social assistance jobs since2002, which makes up one of the top three industries, along with wholesale and retail and accommodation and/food. Crowley’s bottom line forecast for these counties is that manufacturing needs to increase for these areas to grow their population bases and continue growing the economy in Southern Colorado.
From Dr. Phyllis Resnick (Boulder)
- Boulder fared better and improved faster than the rest of the state and the rest of the country since the recession, recovering almost all of its lost jobs by 2011. A full recovery of jobs is predicted by 2014. Wage and Salary Series suggests Boulder County has come all the way back to before the Great Recession in wages. Even with those positive numbers in employment, unemployment per job opening remains high, with education levels of applicants a factor.
- Resnick predicted a “transformational structural change” taking place with our economy. Comparing it to the last period of structural change after WWI, with the era of highways, malls and suburbanization, Resnick says today the information highway and the evolution of the internet will structurally change the way we work and live in this country. While job openings are increasing, many of the potential employees for the positions lack the advanced technological education necessary to do the job. Even in manufacturing, equipment so computerized, the average worker no longer has the skills to do the job. Proof of this prediction comes in the job opening rate. The last time the job opening rate was at 2.8 percent, unemployment was at 5 percent. Today, at the same rate, unemployment remains close to 7.8 percent. This structural evolution will lengthen and slow economic recovery while the country adapts and transitions to these changes.
Anyone interested in reading speakers´ presentations in full or to watch the taped webcast can visit http://www.vectrabank.com/denver.
With assets of $2.4 billion, Vectra Bank Colorado is a proactive, customer-focused organization dedicated to real relationship banking. Part of the Zions Bancorporation (NASDAQ:ZION) family of banks, Vectra serves Colorado´s small, middle-market and corporate business clients with 40 locations throughout Colorado, and one in Farmington, N.M. The bank´s website address is http://www.vectrabank.com. Member FDIC.
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