Woody Hall at Economic Outlook Conference. Photo by Woody Hall at UNCW's Economic Forcast 2010. Photo by UNCW/Jamie Moncrief
At the UNCW Economic Outlook Conference, economist Woody Hall forecasted that the growth in southeastern North Carolina will be four percent in 2010, compared to one percent growth in 2009 and 0.75 percent in 2008.
Hall also said that the 9.6 percent unemployment rate is the highest in twenty-five years and that the state as a whole continues to outpace the national rate.
“There is something different with this (recession), than I’ve lived through. That is that the unemployment rate in North Carolina has been higher than the nation,” Hall said.
Hall said that employment in real estate has gone from one in every five jobs to one in every seven, and that home sales are still down.
In a segment about the 2009 economy and 2010 outlook, Tom Simpson, formerly of the Federal Reserve system presented factors for the current recession and what the future holds. Simpson pointed to December 2007 as the beginning of the recession and said that it could have been much worse.
“We could’ve gone down the path of the 1930s,” Simpson said. “But it’s really the Federal Reserve that is responsible for us dodging the bullet.”
Simpson noted that TARP funds given to banks and creating lower interest rates as reasons why the recession hasn’t been any worse.
He also laid out the reasons for the current downturn, including escalating home prices, leveraging and compounding risk and complex securities. Simpson said that he was one of the ones in favor of the securitazation of loans, thinking they would limits risks. “We were wrong," Simpson said simply.
Also, the fairly rapid increase in national unemployment has been surprising as well, as it has doubled since the recession began, he said. “The rise of the unemployment is greater than one would expect,” Simpson said.
Simpson said that signs of life have been found in the commercial banking sector. They are borrowing less in the last three months than they did earlier this year. In commercial real estate, national vacancy rates in the commercial real estate are still high.
Along with keynote speaker Lew Ebert, the president of the North Carolina Chamber of Commerce, the conference featured a panel discussion on local economic industries, with David Swain, of Swain and Associates, Craig Stevens, CEO of Stevens Fine Homes Tracy Meyer, professor of marketing at the Cameron School and Brian McMerty, partner with the Wilmington Group. Each panelist shared about the trends they’re seeing locally.
“I’m bullish on what’s going on in corporate America. Our business has transformed significantly in the past few years,” McMerty said, noting that changing times has led to changing demands such as in the role of a CFO. “The skillsets that companies needed a few years ago are different going forward.”
Swain said that real estate development changed more to larger corporations during the boom times. “We’re seeing things change so dramatically, it’s hard to keep up with it,” he said. Swain said that he sold properties during the richer times a few years ago, just to have a safety net for when the bottom fell out.
“We held back to see what would happen. Well, it all happened last year,” he said.
Swain said that his company’s small size gives them advantage in adjusting to the marketplace and the he has worked harder on developing personal relationships with merchants and large tenants.
“We have the ability to react to circumstances where the big corporations wont’ have a clue."
Wilmington Business Journal
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