Quarterly Business Analysis Breakfastarkbiz.s3.amazonaws.com/legacy/news/print_editions/... · Breakfast walton outreach September 16, 2011 Center for Business and Economic Research

Quarterly Business Analysis

Breakfast

walton outreach

September 16, 2011

Center for Business and Economic ResearchWillard J. Walker Hall Room 538

Sam M. Walton College of Business1 University of ArkansasFayetteville, AR 72701

Telephone: 479.575.4151Fax: 479.575.7687

http://cber.uark.edu/

Center for Business and Economic Research Sam M. Walton College of Business

University of Arkansas

Quarterly Business Analysis

Friday, September 16, 2011 6:45 – 8:00 a.m.

Schedule of Events

Welcome Kathy Deck Statistical Presentation Kathy Deck, Director

Center for Business and Economic Research Sam M. Walton College of Business University of Arkansas

Program Adjourns Kathy Deck

Special thanks to the Northwest Arkansas Chambers of Commerce for partnering with the Center for Business and Economic Research to bring you this program.

Mark your calendars for Business Forecast 2012! Wednesday, January 25, 2012

Speakers include: Paul Thomas (Chief Economist for Intel), Eugene Flood (Executive Vice President of Diversified Financial Services at TIAA-CREF), Robert Hopkins (Vice President and Senior Branch Executive of the Little Rock Branch of the Federal Reserve Bank of St. Louis), and Kathy Deck.

Sponsorship Opportunities Available

For more information visit http://cber.uark.edu/ or call (479) 575-4151.

http://cber.uark.edu/

1

The Northwest Arkansas Economy in 2011: Surviving in a Weak Recovery

Kathy Deck, DirectorCenter for Business and Economic Research

September 16, 2011

NABE GDP Forecast

NABE Unemployment Forecast NABE Full Employment Forecast

When do you think theeconomy will return to aposition of full employment?

% of NABEpanelists

Cumulative %

2011 0 0

2012 0 0

2013 4 4

2014 17 21

2015 35 56

2016 15 71

2017 12 83

Beyond 2017 17 100

2

GDP

10.0%8.0%6.0%4.0%2.0%0.0%2.0%4.0%6.0%8.0%10.0%

2000

.Q1

2000

.Q3

2001

.Q1

2001

.Q3

2002

.Q1

2002

.Q3

2003

.Q1

2003

.Q3

2004

.Q1

2004

.Q3

2005

.Q1

2005

.Q3

2006

.Q1

2006

.Q3

2007

.Q1

2007

.Q3

2008

.Q1

2008

.Q3

2009

.Q1

2009

.Q3

2010

.Q1

2010

.Q3

2011

.Q1

2011

.Q3

2012

.Q1

2012

.Q3

Real U.S. Gross Domestic Product Growth Rate

Source: U.S. Commerce Department, Bureau of Economic Analysis, September 2011 NABE Outlook

Persistence of a Weak Economy

HousingConsumer and small business credit constraintsSlow consumption pickupRegulatory/policy uncertaintyLack of confidenceGlobal fiscal consolidationState and local government contractionExtent of Europe problemsRate of return on human & physical capital

Consumer Sentiment

0

20

40

60

80

100

120

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Index of Consumer Sentiment

Source: University of Michigan, Survey Research Center

Small Business Sentiment

3

Consumer Credit

$0

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Consumer Credit Outstanding(Millions of Dollars)

Source: Federal Reserve

Retail Sales

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

United States Retail Sales (in millions, seasonally adjusted)

Source: U.S. Census Bureau

Inflation

25.0%20.0%15.0%10.0%5.0%0.0%5.0%

10.0%15.0%20.0%25.0%

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Annualized Percent Change in Headline Consumer Price Index

Source: Bureau of Labor Statistics

Inflation

25.0%20.0%15.0%10.0%5.0%0.0%5.0%10.0%15.0%20.0%25.0%

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Annualized Percent Change in Core Consumer Price Index


4

Interest Rates

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Selected Interest Rates

Fed Funds Rate 10 yr Treasury RateSource: Federal Reserve Board of Governors

Labor Force

4.0%

2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Labor Force, Year Over Year Percent Change

United States Arkansas Northwest ArkansasSource: Bureau of Labor Statistics

Unemployment

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Unemployment Rates, Not Seasonally Adjusted


Employment Growth

6.0%

4.0%

2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Nonfarm Employment, Year Over Year Percent Change


5

Employment

120,000122,000

124,000

126,000

128,000

130,000

132,000

134,000136,000

138,000

140,000Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

U.S. Non Farm Employment


Thou

sand

sEmployment by Sector

Mining and Logging1%

Construction4%

Manufacturing9%

Trade,Transportation,and Utilities

19%

Information2%

Financial Activities6%

Professional andBusiness Services

13%

Education andHealth Services

15%

Leisure andHospitality

11%

Other Services4%

Government16%

U.S. Employment by Sector August 2011


Employment by Sector

1.0%

12.0% 9.0% 6.0% 3.0% 0.0% 3.0% 6.0% 9.0% 12.0%

InformationGovernment

Financial ActivitiesConstruction

Non FarmLeisure and Hospitality

Trade, Transportation, and UtilitiesOther ServicesManufacturing

Education and Health ServicesProfessional and Business Services

Mining and Logging

Change in U.S. Employment by SectorAugust 2010 - August 2011

Source: Bureau of Labor Statistics, CBER Calculations

Arkansas Employment

1,080

1,100

1,120

1,140

1,160

1,180

1,200

1,220

1,240

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Arkansas Non Farm Employment


Thou

sand

s

6

Arkansas Employment

6050403020100

10203040

Jan00

Jul0

0Jan01

Jul0

1Jan02

Jul0

2Jan03

Jul0

3Jan04

Jul0

4Jan05

Jul0

5Jan06

Jul0

6Jan07

Jul0

7Jan08

Jul0

8Jan09

Jul0

9Jan10

Jul1

0Jan11

Jul1

1

Thou

sand

s

Employment Growth in Arkansas and in the FayettevilleSpringdale Rogers, Fort Smith, and Little Rock NLR Conway MSAs

Arkansas Three MetrosSource: Bureau of Labor Statistics

Northwest Arkansas Employment

150

160

170

180

190

200

210

220

Jan00

Jul0

0

Jan01

Jul0

1

Jan02

Jul0

2

Jan03

Jul0

3

Jan04

Jul0

4

Jan05

Jul0

5

Jan06

Jul0

6

Jan07

Jul0

7

Jan08

Jul0

8

Jan09

Jul0

9

Jan10

Jul1

0

Jan11

Jul1

1

Fayetteville Springdale Rogers MSA Non Farm Employment


Thou

sand

s

Northwest ArkansasEmployment by Sector

Mining, Loggingand Construction

4%Manufacturing

14%

Trade,Transportation and

Utilities22%

Information1%

Financial Activities4%

Professional andBusiness Services

18%

Education andHealth Services

11%

Leisure andHospitality

10%

Other Services3%

Government13%

F S R MSA Employment by Sector July 2011


NWA Employment by Sector

-0.3%

10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0%

ManufacturingGovernment

Financial ActivitiesMining, Logging and ConstructionTrade, Transportation and Utilities

Non FarmInformation

Professional and Business ServicesEducation and Health Services

Other ServicesLeisure and Hospitality

Change in F S R MSA Employment by Sector,July 2010 July 2011

Source: Bureau of Labor Statistics, CBER Calculations

7

Northwest Arkansas Real Estate

0

100

200

300

400

500

600

Jul0

4

Jan05

Jul0

5

Jan06

Jul0

6

Jan07

Jul0

7

Jan08

Jul0

8

Jan09

Jul0

9

Jan10

Jul1

0

Jan11

Jul1

1

Number of Houses Sold

Benton County Washington CountySource: Arkansas REALTOR Association


$0

$50,000

$100,000

$150,000

$200,000

$250,000

Jul0

4

Jan05

Jul0

5

Jan06

Jul0

6

Jan07

Jul0

7

Jan08

Jul0

8

Jan09

Jul0

9

Jan10

Jul1

0

Jan11

Jul1

1

Average Price of Houses Sold

Benton County Washington CountySource: Arkansas REALTOR Association


0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

Q220

04Q320

04Q420

04Q120

05Q220

05Q320

05Q420

05Q120

06Q220

06Q320

06Q420

06Q120

07Q220

07Q320

07Q420

07Q120

08Q220

08Q320

08Q420

08Q120

09Q220

09Q420

09Q220

10Q420

10Q220

11

Northwest ArkansasAvailable Square Footage

Office Office/Retail Office/Warehouse Retail Retail/Warehouse Warehouse

Questions and Comments?Thank you!

Business Forecast 2012 is January 25!

Contact me at [email protected] or

479-575-4927

Documents

Quarterly Business Analysis Breakfastarkbiz.s3.amazonaws.com/legacy/news/print_editions/... · Breakfast walton outreach September 16, 2011 Center for Business and Economic Research