National, state job growth pace expected to stay slow
by Staff Writer
CORNELIUS – President Barack Obama’s re-election brought with it a major question: How can the state and federal governments help businesses return to the levels of success they had before the economic downturn?
The same question is being asked at the local level.
But locally, there may be less of a struggle, Wells Fargo economist Michael Brown said after his speech and question-and-answer session at the BusinessToday Newsmakers Breakfast on Nov. 13 at the Peninsula Club.
With businesses and families relocating to the area, the lake area shouldn’t be as adversely affected as other parts of the state and country by the recession that Wells Fargo predicts will hit the nation next year.
Brown said consumer spending and business confidence has dropped, which hurt the national economy since the 2008 recession.
“Consumers make up 70 percent of economic growth,” he said.
Locally though, consumers have helped spur the movement of businesses to the lake area.
“The comfort is we’ve seen organic (economic) growth through (local) development,” Brown told the Herald Weekly after his public remarks.
“That inflow supports a strong retail and housing sector (in the lake area). Those are also the strong markets in the state. I see that as a plus for people (and businesses), as well.”
He said businesses are holding back their hiring decisions because of the uncertainty that stemmed from continued political gridlock in Washington. However, manufacturing, like real estate, continues to show promise.
“High-level manufacturing, like Siemens, are still hiring,” Brown said. “But they’re looking to even more qualified people and using more training once they do.”
The challenge, however, is finding ways to stimulate other aspects of the local, state and national economies beyond who won the presidency. Brown contends the issues wouldn’t change with either Obama or Mitt Romney as president.
“It wouldn’t have really mattered,” he said. “We’re a very cyclical economy. We saw a tremendous amount of growth, but then we downshifted in the past year.”
The level of economic improvement people hoped for nationally isn’t likely to come immediately.
“We’re looking at more of a two- to two-and-a-half percent growth than a three- to three-and-a-half percent growth,” he said. “But there will be some growth.”
Brown’s remarks and answers to a host of questions drew inquisitive nods from the audience of mostly business owners as he went through a PowerPoint presentation highlighting national and state employment numbers, growing industries and other business trends.
Nick O’Shaughnessy, a Realtor, broker and developer with Cornelius-based O’Shaughnessy Realty and Development, agreed with Brown’s sentiment that neither presidential candidate could have more or less of an effect on the immediate economy locally.
“I don’t think it will affect it a great deal,” O’Shaughnessy said. “The economy, as I see, it will recover.”
But the number of people and businesses – small and corporate – migrating to the lake area shows its ability to withstand recessions is better than most markets, even if a national recession occurs.
“It’s an attractive destination. Businesses like it here. The economy’s never really bottomed out here,” O’Shaughnessy said. “When there’s been recessions nationally, we’ve not bottomed out like (other areas) so when they recovered, we recovered a little faster.”