Download Document

The Innovation Economy:
New Opportunities and Risks in the
Evolving Business Cycle
Dr. Bill Conerly
for
Regional Economic Forecast &
Innovation Expo
December 11, 2014
• The Global/National Economy
• The Five Counties
• Economics of Innovation
World Economic Growth
IMF forecast
annual percent change
5
4
3
2
1
0
-1
2011
2012
2013
2014
2015
2016
U.S. Real GDP Growth
Average of
other forecasts
percent change
4
3
2
1
0
-1
-2
-3
2011
2012
2013
2014
2015
2016
Risk of Recession
Wall Street Journal survey
30
25
percent
20
15
10
November: 12%
5
0
Nov-11 May-12 Nov-12 May-13 Nov-13 May-14 Nov-14
U.S. Economy: Major Sectors
Sector
2015-16 Outlook
Consumer spending
,
Housing construction
Non-res construction
Spending grows w/
income
Stronger in 2015-16
Light growth
Bus. Capital Spending
Exports
Federal Gov’t
Strong
Moderate growth
Cuts in goods, services
(but entitlements grow)
State & Local Gov’t
Slow growth
Inflation
Consumer Price Index
% change 12 months
4
3
2
1
0
2011
2012
2013
2014
Interest Rate Forecast
6
5
30-year
mortgage
percent
4
3
2
3-month
T-bill
1
0
2011
2012
2013
2014
2015
2016
Federal Reserve Stimulus
3.0
2.5
$ trillions
2.0
1.5
1.0
0.5
0.0
2007 2008 2009 2010 2011 2012 2013 2014
Commercial Bank Assets
$ billions
Cash
Investments
Loans
2007
482
1,591
6,537
2013
1,632
2,722
7,120
• The Global/National Economy
• The Five Counties
• Economics of Innovation
Unemployment
16
14
percent
12
Grays
Harbor
10
Lewis
Pacific
Mason
8
6
Thurston
4
2
0
2011
2012
2013
2014
Population Growth
2004-2014
Thurston
Pacific
Mason
Lewis
Grays Harbor
-5
0
5
10
percent
15
20
Rural & Urban Issues
• Fewer location-specific jobs
Farming, forestry, fishing, mining
• Most folks like cities
• Much work can be done anywhere
• The Global/National Economy
• The Five Counties
• Economics of Innovation
Offshoring
Labor cheaper, but rising
Cost of quality higher
Regulation more lenient
Overseas markets growing
Onshoring or Reshoring
Labor cheaper, but rising
Cost of quality higher
Regulation more lenient
Overseas markets growing
Onshoring or Reshoring
Labor
cheaper, but rising
More flexible:
Cost
of quality
higher
Quantity
& specs
Regulation
more to
lenient
Quality cheaper
attain
Overseas
Great for markets
low laborgrowing
content
Innovation: Customization
Customization: Manufacturing
Customization: Information
Customization: Medicine
The Nutshell
Most likely
Stronger growth in 2015-16
Higher interest rates
Stable inflation
Rural communities level
Urban areas expanding
Opportunities through innovation
Customization
Questions?
Bill @ ConerlyConsulting.com
one “n”