Alexander shares cautious optimism for economic outlookWritten by Natasha Wheeler
Cheyenne – Anne Alexander, director of international programs at the University of Wyoming, shared her economic forecast at the Wyoming Business Council’s board meeting in Cheyenne on Dec. 10, explaining that there are a number of conflicting signals on the horizon right now.
“We are talking about human behavior and the future. It can feel like the easiest way to do an economic forecast is to shake the Magic 8 Ball,” she joked.
Alexander noted that some positive signs for the national economy include a lower unemployment rate and more participation in the job market over recent months. Construction spending has also been up, and income growth appears to be increasing, both positive signs for the economy in the U.S.
“There are also other signals coming at us that indicate the national economy isn’t improving,” Alexander continued. “The manufacturing employment index has been compressed because our dollar hasn’t been very strong. When our currency is strong, that doesn’t bode well for our exports because our exports are more expensive.”
People’s sense of security is also weak. Recent survey results showed that 38 percent of people fear losing their jobs in the next 12 months, 33 percent say they may not be able to make a loan payment and 25 percent say they may not be able to pay rent.
“When people don’t feel secure, they don’t spend, they don’t hire and they stall out what they are going to do,” she explained.
Alexander also pointed out that China’s growth has been slowing down, which could have a negative impact on manufacturing, exports and Wyoming industry.
“China is a really big headwind, as is pretty much any kind of global growth slowdown,” she stated.
Alexander opined that nationally, the economy is improving moderately, but there are also some obstacles, such as a low rate of inflation in the U.S., instability in the European Union and a recent corruption scandal involving a renewable energy firm backed by national banks in Spain.
“Dollar strength is still a very major headwind for us all,” she added.
In Wyoming, the unemployment rate remains low at around four percent, although unemployment claims from the mining industry have increased.
“To balance that, tourism is booming right now,” Alexander remarked. “There are some other sectors booming as well.”
According to an index built by the Economic Analysis Division, Wyoming has not yet reached a state of recession. The model incorporates a variety of factors, including unemployment rate, private sector jobs, average hourly wage, hours worked, mining sector sales, use tax collections and national park visits.
“If we look at non-farm employment in Cheyenne, Casper and Wyoming, broken out by each of those regions, it has been recovering since the recession. Casper has been up, Cheyenne has been up and Wyoming has been up, but they are all starting to flatten,” mentioned Alexander.
Gas and oil production is one factor influencing those statistics.
“We can see that employment is still positive here for oil production, but it’s starting to fall. It’s still growing but at a slower rate,” she noted. “Non-farm employment is expected to be at about 0.2 percent growth this year and then flatten over the next several years.”
More positively in relation to the state’s economy, trona production is expected to increase, and bentonite production is steady.
“Bentonite is a value-added industry as well, so we should play to that,” Alexander commented.
She also noted that agriculture products make a positive impact on Wyoming’s economy.
“Quality of life here is tremendous. People want to live here,” she continued. “Our work ethic and the adaptability of our workforce is fairly strong. Those are great assets as well.”
“We have a lot of strengths to play to. Tourism has been a solid driver. Our year-over-year park visits from October to October were up 30 percent. Parks are not the only place that have awesome things to see here in Wyoming,” she remarked.
Moving forward, Alexander is also optimistic about the way that people across the state are working together.
She explained, “There is a lot of innovative thinking around regional collaboration on economic development efforts.”
Efforts are being carried out to work together between different counties, different segments of towns and between towns that have never sat down together.
“This helps strengthen our numbers, and I think it’s something people are interested in doing to try to strengthen their cases for getting firms to locate where they are, for getting people to come and visit their towns and for employing their workforce.”