Every January, we are proud to kick off the year with a look at our region’s economic forecast and how it could impact your business. This year, we were pleased to bring you the insights of two economic experts. We heard from Tom Barkin, the president and chief executive officer of the Federal Reserve Bank of Richmond, and Charlie Dougherty, a vice president and economist with Wells Fargo Securities. Judging by their predictions for our region, there is a lot to be optimistic about in the Triangle.
“I hear constantly about all the people who are coming to Raleigh and I believe this trend will continue when you have such strong employment growth and a broadening labor force,” Dougherty told the audience at the Duke Energy Center for the Performing Arts.
Barkin opened by talking about the importance of being “on the ground” in the district he represents, which stretches from Maryland to the Carolinas.
“During the past year, I’ve done just that, traveling pretty much nonstop,” he said. “I am in North Carolina every month.”
Barkin said there are areas in the district that are thriving and some that are struggling.
“For example, there are large disparities in employment, education, and earnings between urban and rural areas, and also within urban areas,” he said. “In North Carolina, about 36 percent of adults in urban areas have at least a bachelor’s degree, compared to just 20 percent in rural areas.”
Barkin told the audience that stronger growth is a sign of a healthy economy.
“Stronger growth creates revenues to reduce the federal budget deficit,” he said. “It improves everyone’s living standards.
But, Barkin encouraged more productivity growth and said the first step is to look at policies that could draw more people back into the labor force.
In particular, he said policies need to encourage more women to participate in the workforce, including the availability of paid leave and subsidized child care.
“Women’s labor force participation, after rising steadily for four decades, leveled off and then began to decline around 2000,” said Barkin. “This is a divergence from other developed countries.”
Overall, he said the economy’s numbers look strong, but business sentiment “has weakened considerably.”
Dougherty echoed those thoughts, saying there has been a shift in sentiment.
He said labor market conditions remain incredibly strong.
“Low unemployment and rising wages will be the driving force behind consumer spending and overall economic growth in 2019,” said Dougherty.
He pointed out that Raleigh and Charlotte are among the top 15 fastest growing metros and that tech is driving much of that growth.
“We think, once the numbers come in, Raleigh and Durham probably added about 28,000 new jobs in 2018 and expect about 24,000 new jobs in 2019,” said Dougherty.
He also discussed the impact of the housing market, saying that home prices are still a bargain in the area.
“Home price appreciation represents a balanced housing market,” said Dougherty.
He said that vacancy rates in Raleigh are decreasing.
“That reflects the strong economic growth that we are seeing,” said Dougherty.
He continued the discussion about the housing market in the panel discussion, which was moderated by WRAL-TV Anchor/Reporter Gerald Owens.
“The housing market is one of the most interest rate-sensitive parts of our economy,” said Dougherty. “But the demand for housing will be so strong.”
We want to thank all of our speakers at Economic Forecast for their great insight into our region’s economic future. Their predictions show we have a lot to be excited about here in the Triangle. We also want to thank our sponsors. Your support and partnership with the Chamber makes an event like this possible.
Our Economic Forecast generated a great amount of interest and discussion on social media. The official Twitter hashtag, #EcoForecast19, was the top trending topic in the Raleigh market for more than 24 hours. The hashtag also had more than 3.6 million Twitter impressions during that time period.
You can read Barkin’s address here. You also can view Dougherty’s presentation slides here.
Please also join us at our Partners Dinner on Feb. 21. This event celebrates the partnership between our elected officials and the Triangle’s business and community leaders. We also are excited to hear from this year’s keynote speaker, Vivian Howard. She is the founder of Chef and the Farmer in Kinston, N.C., and the Peabody Award-winning creator of the PBS television series, A Chef’s Life. We hope to see you there!