Climate change, income inequality, globalization, a growing federal debt and other factors all come home to roost in local communities, economist Henry “Hank” Fishkind told an audience of 400 on Thursday.
Even though Manatee County appears well positioned for the future as an attractive, progressive community, there are red flags, too, Fishkind said during his nuanced annual forecast at the Bradenton Area Economic Development Corporation breakfast at Manatee Technical College.
“The growth in employment underperformed the state over the last 12 months. Employment in business and professional services underperformed. So there is certainly work to be done in a place that is relatively attractive and is performing well,” Fishkind said.
Still, the economy remains strong going into at least the first half of 2019. A possible recession in 2020 won’t be as bad as he feared when forecasting the economy in 2018, Fishkind said.
On the plus side, Manatee County is a desirable community with the development patterns that people want, he said.
“The Lakewood Ranches of the area reflect the best of master-planned communities. And people really prefer to live in high-quality master-planned communities,” said Fishkind, the president of Orlando-based Fishkind & Associates Economic Consultants.
While 1,000 people a day still move to Florida, the rate of growth has slowed. Most of that growth will be “concentrated in the best places,” like the Bradenton area, he said.
“The location is helpful being very near Tampa but also very close to Sarasota. There is that cross pollination of demand. Transportation is excellent, both on the highways and through the air. So it has the key things: It is in Florida, it is accessible, it is visible and it has high-quality master-planned communities,” Fishkind said.
As for the local real estate market, inventory remains tight, and there is nothing to suggest that the area is being overbuilt, he said.
Asked about the impact of the partial government shutdown, Fishkind said if the duration is short, shutdowns don’t tend to have much impact on the gross national product. Though at 27 days as of Thursday, this is the longest government shutdown in U.S. history.
“There is direct concerns for the federal employees, there is direct concerns for those businesses that are unable to get the licenses and permits they need because the federal government is not operating. And then there is the broader impacts on consumer confidence and business confidence that occurs when the government is shut down,” he said.
Other worrisome problems include the growing federal budget deficit and income inequality.
The share of aggregate income held by the middle class households is the lowest since the 1970s, with higher-income households holding a growing and disproportionate share.
“The distribution of income does have economic consequences,” he said. “This stuff does matter.”
Going forward, indicators to watch that will have an impact on the national economy are the 10-year bond rate, stock market volatility, Fed funds rate, new claims for unemployment, and policy decisions on immigration and trade, he said.
Afterward, Timothy J. Coop, Tampa Bay regional president for Hancock Whitney Bank, called Fishkind’s presentation a mixed bag. His biggest takeaways included the desirability of more infrastructure investment and the need to address the federal deficit.
Laura Cole, vice president of marketing for Lakewood Ranch, said that even with the potential slowing of the economy, she believes her company is in a good position.
“We haven’t seen an over-inflation in prices. We have a balanced market,” she said. “We’re in an area where people want to live.”