U.S. inflation rate, as measured by consumer price index rose by 1.0 percent in May, as the year-over-year change accelerated to 8.6 percent, the highest level since December 1981. Price increases were mainly driven by shelter, gasoline and food. Core CPI, which excludes food and energy rose 0.6 percent in May for an annual rate of 6.0 percent.
For a complete report go to: https://www.bls.gov/news.release/pdf/cpi.pdf
Total nonfarm payroll employment rose by 390,000 in May, according to the U.S. Bureau of Labor Statistics. Notable job gains occurred in leisure and hospitality (84,000), but still down by 1.3 million or 7.9 percent from February 2020; professional and business services (75,000), higher by 821,000 than in February 2020; transportation and warehousing (47,000); construction (36,000); healthcare (28,000); and manufacturing (28,000). Employment in retail trade was down by 61,000 in May.
In May, the unemployment rate was 3.6 percent for the third month in a row, and the number of unemployed persons was unchanged at 6.0 million. Prior to the COVID-19 pandemic in February 2020, the unemployment rate was 3.5 percent with 5.7 million unemployed.
For a complete report go to: https://www.bls.gov/news.release/pdf/empsit.pdf
The U.S. Bureau of Economic Analysis (BEA) has issued the following news release today:
Real gross domestic product (GDP) decreased at an annual rate of 1.5 percent in the first quarter of 2022, following an increase of 6.9 percent in the fourth quarter of 2021. The decrease was revised down 0.1 percentage point from the “advance” estimate released in April. In the first quarter, there was a resurgence of COVID-19 cases from the Omicron variant and decreases in government pandemic assistance payments.
Profits decreased 2.3 percent after increasing 0.7 percent at a quarterly rate in the fourth quarter.
The full text of the release on BEA’s website can be found at: www.bea.gov/news/2022/gross-domestic-product-second-estimate-and-corporate-profits-preliminary-first-quartert
TUSCALOOSA, Ala. – Even with confidence in the state economy growing along with increasing industry profits and sales, state business leaders are decidedly negative in their outlook for the nation’s economy, according to the latest quarterly survey by The University of Alabama’s Center for Business and Economic Research.
The UA Center for Business and Economic Research’s latest Alabama Business Confidence Index, taken in early March, showed nearly 58% of business leaders forecast worse economic conditions for the United States in the second quarter of 2022.
“Inflation is a big part of the concerns for the U.S. economy,” said Susannah Robichaux, socioeconomic analyst for CBER. “Small and mid-sized firms had notably lower U.S. economic outlooks than large firms, which makes sense since these smaller businesses have tighter margins and would feel the impact of inflation sooner than their larger counterparts.”
The Alabama Business Confidence Index was 54.6, meaning state business leaders have mostly positive economic expectations for their businesses and the state economy in the upcoming quarter, however the latest survey continues the downward trend. An index over 50 indicates a positive forecast compared to the previous quarter, and the higher the number, the more confident the forecast.
The ABCI dropped 2.6 points from the last survey and is down from 67 in a survey taken in June 2021, just before a resurgence of the coronavirus through the Delta variant.
ABCI is gathered from a broad group of business executives across the state with six key indicators and a composite index. The statewide and national forecasts, along with industry-specific components like sales, profits, hiring and capital expenditures comprise the six indexes that combine to make the ABCI total.
While panelists have an overall positive outlook on the economy, nationally, business leaders aren’t as optimistic, reflected in an index of 38.5 for the national economy. In fact, state business leaders have not had a positive outlook for the U.S. economy since that survey snapshot before Delta.
“On one hand we have a relatively strong economy with very strong labor markets, both in terms of hiring and new job creation, labor force participation rate continues to tick upwards, corporate profits look great, and housing markets are doing well,” said Ahmad Ijaz, CEBR executive director. “But there are also signs pointing to the fact that the economy may be headed for a recession.”
Ijaz listed higher prices, falling exports, soaring inflation, rising interest rates, long-term interest rates currently lower than short-term rates, and the continued effects of Russia’s war in Ukraine.
Earlier this year, Ijaz and economists at CBER had predicted Alabama’s economy would grow about 3% in 2022, but have since revised that outlook to 2.7% growth.
Six of the nine industry groups surveyed remain positive in their outlook for the second quarter, with healthcare and social assistance businesses reporting the lowest negative outlook.
The breakdown of all the industry forecasts by sector can be seen in the statewide ABCI report on CBER’s website.
In addition to the statewide ABCI report, CBER also collects ABCI data to write individual reports for Alabama’s five major metro areas. These metro reports offer insight into the forecasts for each specific region.
Source: Susannah Robichaux, socioeconomic analyst for CBER, scrobichaux@cba.ua.edu
Press Release by Adam Jones, UA communications, 205-348-4328, adam.jones@ua.edu
TUSCALOOSA, Ala. – Alabama’s economy could see stellar growth in 2022 as the state and country continue reopening commerce in the wake of the global coronavirus pandemic, according to researchers at The University of Alabama.
Pitfalls remain with the unknown behavior of the virus and continued pandemic-related supply chain bottlenecks, labor shortages and rising prices. Still, low unemployment across Alabama coupled with increased output by the state’s manufacturing and service sectors should mean a rise in the value of goods and services produced in the state, according to the annual economic forecast from the Center for Business and Economic Research at UA.
UA economists predict the state’s economy will grow 3.4% to reach $213.5 billion in Alabama’s gross domestic product. This follows the 4.8% growth in 2021 that shook off the 3.2% economic contraction of 2020, In the previous five years, economic growth in Alabama was never more than 1.7%.
“A 3.4% growth rate is great, considering the growth rate in the years before 2021,” said Ahmad Ijaz, executive director of the center. “It’s likely we will revise this upward, depending on how the data comes in from the fourth quarter of 2021 and the first quarter of 2022.”
Part of the Culverhouse College of Business, UA’s Center for Business and Economic Research has produced forecasts of economic activity in Alabama since 1980. These forecasts cover Alabama’s Gross Domestic Product, employment, and income by industry group and are published in the annual Alabama Economic Outlook. Forecast updates are run quarterly. The center incorporates data from the last 30 years, including cycles and recoveries captured over the years, into its statistical and economic models.
Along with annual dives into the national and state economy, including examinations of metro areas in Alabama, this year’s outlook includes a special look at the 2020 Census and populations changes in the state, authored by Dr. Nyesha Black, director of socioeconomic analysis and demographics.
The 2022 Alabama Economic Outlook, available for free on the center’s website, reports inflation will continue to be an issue this year despite changes in federal monetary policy that will likely see rising interest rates.
“The rate of increase in prices in 2022 may slow down some, but we will still see an increase in price levels in 2022,” Ijaz said. “Hopefully, it won’t be as significant as in 2021, but the changes in prices will continue albeit at a slower pace until the supply side issues and the labor market issues can be resolved.”
Federal efforts the past two years to encourage economic recovery will taper off this year, which will influence demand continuing the trend of the last half of 2021, Ijaz said. Unresolved trade issues, particularly with China, also remain a concern for the state.
For state tax collections, economic growth and yet-to-be-spent federal recovery money will continue the above-average growth. During the fiscal year 2022, total tax receipts are expected to increase by 8.0%, or $1.1 billion above the last fiscal year, to total $15.1 billion.
The University of Alabama, part of The University of Alabama System, is the state’s flagship university. UA shapes a better world through its teaching, research and service. With a global reputation for excellence, UA provides an inclusive, forward-thinking environment and nearly 200 degree programs on a beautiful, student-centered campus. A leader in cutting-edge research, UA advances discovery, creative inquiry and knowledge through more than 30 research centers. As the state’s largest higher education institution, UA drives economic growth in Alabama and beyond.
The Alabama State Data Center (ASDC), housed in the University of Alabama’s Center for Business and Economic Research (CBER) hosted a second Census data conference this fall on Thursday, October 7 from noon to 4:00 p.m. The virtual conference included presentations on how to access the latest 2020 decennial Census results from Data.Census.gov, the innovative Census Pulse Survey, the Count Question Resolution (CQR) program, and the economic products available from the U.S. Census Bureau. Click on the red titles below to view the slide deck from each presentation.
Alabama State Data Center Fall 2021 Conference
Thursday, October 7, 2021: 12:00 – 4:00 p.m.
Welcome and Introductions | Susannah Robichaux, ASDC Lead / Socioeconomic Analyst, The University of Alabama’s Center for Business and Economic Research; and Barb Lafleur, Acting Assistant Branch Chief and State Data Center Liaison, Data Users Branch, U.S. Census Bureau.
Data.Census.Gov | KaNin Reese, Partnership Specialist, Branch Chief, Dissemination Outreach Branch, Center for Enterprise Dissemination, U.S. Census Bureau. This presentation includes step-by-step demos for data.census.gov including topics like getting started using the single search bar or advanced search, comparing data across time and geographies, finding business data (searching by industry), and microdata access (MDAT).
Pulse Survey | Kathryn Bonney, Economic Management Division; Colin Shevlin, Economic Indicators Division; and Jason Fields, Social Economic & Housing Statistics Division, U.S. Census Bureau. An overview of the two Pulse surveys: the Small Business Pulse Survey (SBPS), which measures the effect of changing business conditions during the Coronavirus pandemic on U.S. small businesses, and the Household Pulse Survey (HPS), which was designed to understand the impact of COVID-19 on American families relating to employment, food security, housing, health, and educational disruption.
Count Question Resolution | Matthew Frates, Chief of the Count Question Resolution Branch, Decennial Census Management Division, U.S. Census Bureau. The 2020 Census Count Question Resolution (CQR) program provides a mechanism for governmental units to request a review of their official 2020 Census results and to help ensure that housing and population counts are correctly allocated to 2020 census tabulation blocks. This presentation is not yet available, so the link leads to the official Census CQR page.
An Overview of Key Economic Data for Alabama (including COVID data)| Andrew W. Hait, Economist, International Trade Management Division, U.S. Census Bureau. The U.S. Census Bureau is the federal government’s largest statistical agency and conducts more than 130 censuses and surveys each year. This presentation covers some of the types of data available from the economic surveys, how to access them, and some pre-made searches to help you find Alabama statistics.
Education and workforce training is the top issue facing Alabama’s economy, according to business leaders who participated in the 2020 Alabama Business Confidence Index (ABCI) Panelist Poll.
Alabama business leaders have voted education and workforce training as the state’s primary issues for the last five years. In the 2020 survey, 74.5 percent of panelists reported concerns about the state of the education and workforce training system, and 18 percent of those panelists provided specific comments, which included concerns about the lack of funding for education, the shortage of qualified workers, and a desire for more short-term training opportunities for all fields. Panelists ranked economic and business development as a close second at 70.4 percent, and 20.0 percent shared worries about the uncertainty related to COVID-19 and the importance of diversifying the state economy.
Panelists were also able to select the top issues facing their own companies. Though almost half of the business leaders were concerned about workforce issues, 63.9 percent selected the “economy in general” as their number one concern. Among those who selected the economy as one of their top concern, 14.5 percent shared more details about their selection, with many naming the uncertainty due to COVID-19 and 2020 election as their main concerns.
Each quarter, business leaders respond to the ABCI survey and receive reports that summarize the business sentiment for the state and its five largest metro areas. Business leaders use these quarterly reports as a general indicator of local and regional economic outlook (80.6 percent), as background information for their own forecasts (43.9 percent), and to compare their personal projections to their fellow peers in business (35.7 percent). In addition, 28.6 percent of business leaders who responded to the poll use ABCI reports for economic development, decision-making, or short-term planning, and 24.5 percent share the results from ABCI with others.
About the ABCI Panelist Poll
The Center for Business and Economic Research (CBER) in The University of Alabama’s Culverhouse College of Business conducts an annual survey of Alabama business leaders to determine the top issues facing the state and their respective companies. The ABCI panel is open to business executives across the state, and was conducted throughout November 2020.
Registration and current and historical results are available on the ABCI page of CBER’s website. Newsletters with results are provided for Alabama and for the Birmingham-Hoover, Huntsville, Mobile, Montgomery, and Tuscaloosa metro areas. Panelists can take the Q4 2021 survey from September 1-15, 2021. For questions, please contact socioeconomic analyst, Susannah Robichaux at scrobichaux@cba.ua.edu.
TUSCALOOSA, Ala. – Two snapshots of the state’s economy earlier this summer show recovery from the pandemic recession of 2020 exceeding expectations, with business leaders confident things were getting even better, according to research from The University of Alabama.
It’s unknown whether the rise of the Delta variant of the coronavirus that causes COVID-19 will dampen the economy, but, if it does, nothing short of another lockdown could stunt the recovery, said Ahmad Ijaz, executive director of the UA Center for Business and Economic Research.
“We will most likely see 5.0 to 5.5 percent growth for this year, and perhaps next year too, on the condition that we don’t shut down the economy again,” Ijaz said. “Another shut down will most likely have a much more devastating impact on the economy.”
CBER released its quarterly economic forecast, Alabama Business, today which showed the state’s economy grew 6.8% in the first quarter of 2021, which followed a strong half of 2020 after plummeting economic activity the first half of last year.
The forecasted 5.5% economic growth for 2021 will make up the 2.7% drop in economic activity in 2020.
The state’s economy has continued to beat growth forecasts as business sectors come back at different speeds because of supply constraints and loose monetary policy fueled business and consumer spending, Ijaz said.
“At the start of the year, everybody was predicting that the economy would get back to its normal course after a huge jump in growth in third and fourth quarters of 2020, but as the year went along the economic growth just kept on accelerating,” he said.
The state gained 13,200 jobs in June over the previous three months. From June 2020 to June 2021, the state gained 89,200 jobs with a seasonally adjusted unemployment rate this June of 3.3 percent, down from the 7.7 percent unemployment rate in June 2020, according to the study.
Also, CBER released its latest quarterly survey of local business leaders. Taken in the first half of June, it showed historical confidence about the direction of Alabama’s economy. The Alabama Business Confidence Index was 67, up nearly three points from the spring survey.
It’s the most confidence business leaders have had in forecasting economic growth since the third quarter of 2004, according to CBER data. Plus, this is the third consecutive quarter all the industry-level ABCIs have been positive, indicating sustained expectations for economic expansion across all industries in Alabama.
An index over 50 indicates a positive forecast compared to the previous quarter, and the higher the number, the more confident the forecast. The statewide and national forecasts, along with industry-specific components like sales, profits, hiring and capital expenditures comprise the six indexes that combine to make the ABCI total.
For those participating in the survey, more than three-fourths forecasted a better economic outlook for Alabama in the third quarter of the year, and 70 percent expected sales to increase compared to the second quarter of 2021.
“Alabama business leaders were feeling really good in June,” said Susannah Robichaux, socioeconomic analyst for CBER. “Many businesses throughout the state experienced some contraction and uncertainty due to COVID, and these latest ABCI results tell us that folks were really anticipating a recovery and feeling confident in their forecasts for growth. Now, some of that is up in the air due to the Delta variant making such a strong showing.”
The breakdown of all the industry forecasts by sector can be seen in the statewide ABCI report on CBER’s website.
In addition to the statewide ABCI report, CBER also collects ABCI data to write individual reports for Alabama’s five major metro areas. These metro reports offer insight into the forecasts for each specific region.
Original Source: https://news.ua.edu/2021/08/states-economic-recovery-booming-just-before-covid-19-resurgence/
The University of Alabama, part of The University of Alabama System, is the state’s flagship university. UA shapes a better world through its teaching, research and service. With a global reputation for excellence, UA provides an inclusive, forward-thinking environment and nearly 200 degree programs on a beautiful, student-centered campus. A leader in cutting-edge research, UA advances discovery, creative inquiry and knowledge through more than 30 research centers. As the state’s largest higher education institution, UA drives economic growth in Alabama and beyond.
CBER analyst Susannah Robichaux was invited to address the MPO Planners Conference held by the Alabama Department of Transportation on Tuesday, April 7. Robichaux gave updates on the Office of Management and Budget’s announcement to increase the minimum population for metropolitan statistical areas, and shared reminders for municipalities to participate in the Census Bureau’s Boundary and Annexation Survey. To view a PDF of her presentation, click here.
As a reminder, CBER’s staff may make presentations at conferences and meetings for an honorarium. Feel free to reach out to individual staff members or uacber@cba.ua.edu with any speaking requests.
Pandemic’s Effects Will Linger on State’s Growing Economy
TUSCALOOSA, Ala. – The state’s economy could grow by 2.6% in 2021, a good clip that will not pull the state out of the hole created in 2020 by the coronavirus pandemic, according to a report published today by economists at The University of Alabama.
“It will be a couple of years before we get back to pre-pandemic level economic activity, or perhaps even longer for some sectors of the economy,” said Ahmad Ijaz, executive director of the Center for Business and Economic Research at UA. “We are in a sort of recovery mode right now, but, hopefully, we will be in expansion mode by the second half of the year.”
The 2021 Alabama Economic Outlook, available for free on the center’s website, reports the vibrations of the economic shocks from the pandemic will be felt for years, even with economic interventions from the federal government.
UA’s Center for Business and Economic Research, part of the Culverhouse College of Business, has produced forecasts of economic activity in Alabama since 1980. These forecasts cover Alabama Gross Domestic Product, employment, and income by industry group and are published in the annual Alabama Economic Outlook. Forecast updates are run quarterly. The center incorporates data from the last 30 years, including cycles and recoveries captured over the years, into its statistical and economic models.
Along with annual dives into the national and state economy, including examinations of the five largest metro areas in Alabama, this year’s outlook includes a special look at the pandemic’s effect on the state economy, authored by Dr. Nyesha Black, director of socioeconomic analysis and demographics.
In 2020, the Alabama economy contracted by 2.7%, part of a national halt to record economic growth caused by the global pandemic, according to the report. Prior to the pandemic, the state was growing at a rate that bounced from 1.5% to 2%, Ijaz said.
Alabama’s real GDP, the total value of all goods and services produced in the state, will reach about $200 billion, according the report. However, that is projected to remain below the 2019 level of about $201 billion until 2022.
Nonfarm employment in Alabama is projected to rise by 1.5 percent in 2021, reversing the 3.4 percent decline seen from Sept. 2019 to Sept. 2020, according to the outlook.
Along with continued economic issues from the pandemic, unresolved trade disputes, particularly with China, could exert downward pressure and constrain economic recovery this year, according to the report.
Sectors driving growth in Alabama’s economy in 2021 will be the financial services industry, residential construction, auto and other transportation equipment manufacturing, along with professional and business services in the scientific and technical services, waste management and administrative services.
Considering the slumping economy, state tax revenues fared well. For the fiscal year ending in September 2020, state tax receipts rose by 5.0 percent. With the expected recovery of the state economy, the center’s outlook projects tax revenues to grow by 3.8 percent this fiscal year.
Despite the recovering economy, Ijaz said more federal assistance from Congress and the Federal Reserve is needed.
“Federal intervention would definitely help, especially to some sectors of the economy that employs relatively low-skill, low-wage labor, who have primarily felt the major brunt of the recession,” he said.
