Thursday, January 6, 2011

It's Good News, Bad News, Modest News at the Economic Outlook Hearing

Posted By on Thu, Jan 6, 2011 at 1:44 PM

And so it begins.

A bipartisan committee of Idaho legislators are packed into an auditorium at the State Capitol, poring through stacks of reports and charts in an attempt to forecast the economy. A full agenda faces lawmakers Thursday and Friday, including directors from state agencies in addition to experts from Idaho's private sector.

Up first Thursday afternoon was Derek Santos, economist with Idaho's Division of Financial Management.

"The recession is over," said Santos, getting everyone's attention. "That's the really good news. The recession ended a year and a half ago. The bad news is that it doesn't feel like it."

Santos then referred to his first reference, an analysis of personal income in Idaho. He pointed out that income in Idaho dropped in 2009, the first time in more than a decade. Income remained flat in Fiscal Year 2010, and Santo predicted a "still modest" growth of 3.4 percent for FY 2011 and 2012.

"Usually, when you have any kind of a recovery, housing will lead you out of a recession," said Santos, referring to housing starts.

Housing starts in Idaho decreased a whopping 47 percent in 2009, but bounced back with a modest 8 percent growth in 2010. Santos predicted another drop in FY 2011-18 percent, but then said FY 2012 would experience a 75 percent increase.

"That may seem crazy," cautioned Santos. "But we're really talking about a modest recovery, because that would represent only about 9,000 units."

The job outlook comes next as Bob Fick from the Department of Labor takes the microphone.

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