Well, relatively good news about the U.S. economy has been hitting the press this year.
Despite recent job-creation numbers below what many expected, which I suspect is a glitch, the U.S. economy’s performance is stellar when compared with other Western developed countries.
U.S. inflation-adjusted gross domestic product growth has hovered around 2 percent the past four years or so, recovering from a negative 4 percent growth during the recent recession.
Colorado has outperformed the U.S. economy, with state GDP growth continuing to climb, through 2013.
And La Plata County? Local personal income, a proxy for GDP, growth fell more sharply, about negative 6 percent, than the state during the recession, but it has rebounded more quickly than Colorado. For 2012, the most recent data available, La Plata County’s growth equaled the state’s.
And the good news doesn’t end there.
The unemployment rate in the county is a seasonally adjusted 5 percent, down from just over 7 percent, about 0.5 percent lower than in the state, and 1 percent below the national average.
However, an alternative measure of local labor markets, the employment-population ratio, is less auspicious. Like the rest of the country, data show labor markets have barely budged since 2010, though some demographic changes are at play.
Things are looking good at the micro level, particularly with respect to tourism.
The Fort Lewis College Office of Business and Economic Research’s tourist index is about where it was when the Great Recession began, recovering about 15 percent since 2011.
Planes, trains and Mesa Verde National Park all have seen improvements compared with the past few years. A result mimicked by Durango’s retail tax receipts.
Real estate markets have recovered and leveled off somewhat. Inflation-adjusted median home prices for La Plata County have stabilized and hover in the $250,000 range, in 2007 prices.
Building permits are also on the rise, according to the most recent data available.
Positive, too, is the local bank sector. Deposits, while leveling off for the past year or so, climbed back following the recession. Bank assets, which understandably took a hit during the recession, are on the road back to where they were before the housing bubble burst.
Given that I am an economist, you know there almost has to be some skepticism – I won’t go so far as to call it gloom and doom.
Economists are concerned about the low rates of inflation – something the Fed is also concerned with. Nationally, the core rate of inflation – that inflation less energy and food price increases – is below the Fed’s 2 percent threshold.
Look for the Fed to keep interest rates low to fuel some inflation.
In Durango, inflation is running a bit higher.
I’m also concerned the unemployment rate hides issues in labor markets. While the “official” unemployment rate is 6.1 percent, the rate that includes discouraged and marginal workers, is twice that.
Slowly, I’m gaining confidence, if only ...
sonora_t@fortlewis.edu. Robert “Tino” Sonora is professor of economics at Fort Lewis College and the director of the Office of Business and Economic Research at Fort Lewis College.
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