Download Unemployment Rate

Dayton and
Southwest Ohio
Economy
Richard Stock, PhD.
Business Research Group
University of Dayton
State of the Dayton Metro Area
(in December Each Year, 2000-2013)
• Dayton lost
32,400 jobs in the
two year period
from December,
2007 to
December, 2009.
• It recovered 7,900
of those jobs in
the 2 years to
December, 2011
• That recovery has
stagnated in the
last two years
Employment (in 000s)
460
443.1
440
420
400
404.7
378.5
380
360
340
320
372.3
State of the Dayton Metro Area: Last 4 Years
(in December Each Year, 2009-2013)
• Growth was
steady in the Dec.
2009 to Dec. 2011
period.
• Last 24 months,
loss of 1700 jobs
Employment (in 000s)
382
380.2
380
378.5
378
376
376
374
372
370
368
379.7
372.3
Total Employment Index: Dayton and Cincinnati Metros
compared to Ohio and the United States, Dec. 2000-2013
Construction Employment Index: Ohio and the United
States, Dec. 2000-2013
Manufacturing Employment Index: Dayton and Cincinnati
Metros compared to Ohio and the U.S., Dec. 2000-2013
Trade, Transportation, Utilities Employment Index: Dayton and
Cincinnati Metros compared to Ohio and the United States,
December 2000-2013
Prof. & Bus. Serv. Employment Index: Dayton and Cincinnati
Metros compared to Ohio and the United States, December 20002013
Education and Health Services Index: Dayton & Cincinnati Metros
compared to Ohio and the United States, December 2000-2013
Government Employment Index: Dayton & Cincinnati Metros
compared to Ohio and the United States, December 2000-2013
Note that Government Employment Actually Rose in Dayton Metro
from 2008 to 2010
Federal Government Employment Index: Dayton & Cincinnati
Metros compared to Ohio and the United States, December 20002013
Note that Government Employment Actually Rose in Dayton Metro
from 2008 to 2010
Local Government Employment Index: Dayton & Cincinnati Metros
compared to Ohio and the United States, December 2000-2013
The Income Piece
• How Big is the Wage Problem?
Average Weekly Earnings in Dayton and Cincinnati relative to
Ohio and U.S., November 2007-2013 (2013 Constant Dollars)
Relationship to National Economy
Cyclical factors
• How closely linked is the Dayton Economy to the National
Economy?
• From December, 2002 to December, 2013, 92% of variation in
monthly Dayton Metro Area unemployment rate can be
explained by variation in the U.S unemployment rate
United States, Dayton Metropolitan Area Monthly
Unemployment Rates, December 2002-December 2013
United States, Dayton Metropolitan Area Monthly
Unemployment Rates, December 2006-December 2013
United States, Dayton Metropolitan Area Monthly Single
Housing Units Building Permits, August 2001-November 2013
(Aug 2001 =100)
Dayton Metropolitan Area Monthly Single Housing Units
Building Permits, November 2002-November 2013
Number of Unemployed in Dayton Metropolitan Areas, 1990November 2013
Forecasting the Next 3 years
• Note that the Dayton Metropolitan Areas has
mirrored the Country as a whole more closely in the
last few years.
• What are the implications of the National Economic
Forecast?
• Federal Government and Local Employment Declines
Have Already Taken a Toll. How Much More?
Survey of Professional Forecasters, Philadelphia Federal
Reserve Bank (4th Quarter Estimates)
Unemployment
Rate (%)
Real GDP (%)
Quarterly data:
2014:Q1
2014:Q2
2014:Q3
2014:Q4
2015:Q1
CPI Inflation Rate (%)
Headline
Core
2.0
3.0
2.8
2.7
3.2
6.7
6.6
6.4
6.3
6.2
1.7
1.7
1.9
2.0
2.0
1.8
1.8
1.9
1.9
2.1
Annual average data:
2014
2.8
2015
3.1
2016
3.1
2017
2.4
6.5
6.1
5.7
5.5
1.8
2.0
2.1
1.9
2.0
2.1
Implications of National Forecast for the Dayton
Metropolitan Economy
Dayton Metro
Real GDP (%) Unemployment Unemployment Number of
Rate
Unemployed
Rate (%)
Quarterly data:
2014:Q1
2014:Q2
2014:Q3
2014:Q4
2015:Q1
2.0
3.0
2.8
2.7
3.2
6.7
6.6
6.4
6.3
6.2
6.9
6.8
6.6
6.5
27,500
27,200
26,600
26,300
Annual average data:
2014
2.8
2015
3.1
2016
3.1
2017
2.4
6.5
6.1
5.7
5.5
6.7
6.3
5.9
5.7
26,600
25,400
23,800
23,000
Defense Budget Squeeze Impact
• Number of Jobs Linked to Wright Patterson Air Force Base
Activities ~ 25,000 to 30,000
• Cuts are likely to be program specific for particular big ticket
items, impact on Wright Patterson related employment is
uncertain.
• If one assumes a 10% drop in WPAFB related employment
over a 3 to 4 year period, that implies 2500 to 3000 fewer
jobs or an annual impact of about a 1000 jobs.
• It represents a head wind on local job growth
• One potential upside – potential wins in next BRAC rounds
Summary
• Job growth in the Dayton Metro Area economy has
stalled in the last 24 months
• The Dayton Metro Area Unemployment rate remains
closely linked to National levels but is lagging behind
• While the Dayton economy mirrors more closely the
national economy in 2013 than at any point in the
last 20 years, reductions in planned defense
spending will constitute a headwind over the next
few years.