RECENT EVENTS

 

February 15, 2011 Economic Outlook Luncheon

 

On Tuesday, February 15, 2011, DCEDC hosted its annual Economic Outlook Luncheon program. Once again William Strauss, Senior Economist and Economic Advisor at the Federal Reserve Bank of Chicago, presented his view on what he expects to happen next for the global and local economies. His presentation was filled with predictions ofgrowth for the United States over the next couple of years tempered by the constant reminder that this growth will be minuscule in comparison to normal inflation and population increases.

The Great Recession ended in June 2009 and the economy has expanded by 2.8% over the past year. This may not have felt like a recovery period because 62% of the growth was in replenishing depleted inventories with only a 1% increase in final sales. Growth is expected to be about 3-3.5% for the next year with more of the growth in the area of demand, making the recovery more apparent.

Another factor affecting the economy that has changed after the recession is people's personal savings habits. This has increased from around 1% to 5%, which is ultimately a good thing for the economy, but takes many years to be seen. Two-thirds of our economy is driven by consumer spending and when people decide to spend their savings a real increase in final sales will be noticeable. People used to put their trust in the two old stand-bys of homes and equity markets for their retirement and these have taken a hard hit. The consumer no longer has faith in these and is forced to save out of their income.

The U.S. economy lost almost 9 million jobs between December 2007 and February 2010, but in March 2010 total employment began to increase. This decreasing unemployment rate is positive but does not reveal the whole picture. While the overall workforce is seeing an increase in jobs, this is not at a high enough rate to make-up for the increasing population and labor force of the nation for recent years.

Strauss's overall predictions for the next year are to see the U.S. economy improving at a solid pace with the employment rate continually rising. He expects the biggest problems plaguing the county to come from foreign markets. Strauss believes there will be improvements and growth in the manufacturing and auto-sales sector along with slight improvements in the housing market.

At the end of his presentation, Strauss fielded questions form the audience. Then Dave Juday, co-chair of the event, wrapped up the afternoon with some closing comments and appreciation for the event attendees and presenter.

William Strauss's presentation is available in the Members Only section of the website.

William Strauss and Paul Borek before the program	Peers network over lunch
The sold-out program filled the auditorium	Strauss delivers his presentation