Oregon Economic Forecast 3/19

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By Ken Niezgoda,
BIZ Reporter,

Seventy percent of all jobs lost last year in Oregon were lost in the last quarter, and the state will continue to lose jobs in nearly all industries throughout 2009, according to Oregon Economic and Revenue Forecast released by the Department of Administrative Services
Office of Economic Analysis
. The report also mentions economic indicators that show Oregon experienced the largest decline in economic activity of any state for a three-month period going into November 2008.

“OEA projects the year average for 2009 is an employment decline of 4.3 percent. Job growth is positive but very weak with job gains of 0.04 percent in 2010,” according to the report. “The Oregon economy does not start to recover until the second half of 2010.”

The report projects that even into 2010, most industries will experience only modest gains. Both the Government sector and Leisure and Hospitality, which experienced job growth in 2008, are projected to lose jobs in 2009. Arts, Entertainment, and Recreation, a sub-category of Leisure and Hospitality, actually showed a 2.8 percent increase in January 2009, which was the largest of any Oregon industry (note).

Projected state revenues are down as well. According to the forecast, the General Fund revenues for the 2007-09 biennium are $12,018.4 million, a decrease of $713.1 million from the December 2008 forecast. The decrease is largely due to an expected decline in personal income tax, although the report stated that corporate income tax receipts are showing “some significant signs of weakness.”

The one bright spot in the forecast is in Education and Health Services job growth. This sector experienced a 3.9 percent in job growth in 2008 and is expected to increase 3.0 percent in 2009, 3.1 percent in 2010, and 2.7 percent in 2011. Construction should receive a boost from both the federal stimulus package and state capital projects, but gains aren’t expected until 2011.