1. ECONOMIC OVERVIEW Janet Kelly Urban Studies Institute University of Louisville

2. Gross Domestic Product Nationally, 2% growth in 2013, about the same as last year Reinstating payroll taxes will probably shave a point from GDP A good resolution to the “fiscal cliff” issues might speed up productivity, improve consumer confidence The one year extension of tax breaks or new or leased equipment should spur capital spending by business in 2013

3. Real GDP is the output of goods and services produced by labor and property (chained 2005 dollars)

4. Interest Rates Looks like the Fed will hold fast to its near-zero federal funds rate Prime at about 3.25% Bank CDs at about 1% yield Inflation should tick up a little – Look for about 2.3%, mainly due to fuel and food – Core inflation (excludes volatile fuel and food) stays around 2%

7. Housing The experts are predicting a big rebound year, getting us back to 2007 levels Metro areas are seeing prices rise already – According to Greater Louisville Association of Realtors, home sales up 15% in 2012 – Median price $140,000 Historically low mortgage rates (average 3.3% on conventional fixed rate) will help reduce the glut of unsold homes About 1/3 of sales are to first-time buyers

9. Employment Job growth steady, but slow Unemployment to drop only to 7.5% from 7.8% at the end of 2012 Economy is still down by 4.8 million jobs from pre-recession numbers Employment numbers not moving much for certain groups (nationally) – African Americans at 14% – Hispanics or Latino ethnicity at 10% – Less than high school diploma at 12%

10. Source: US Bureau of Labor Statistics. Local Area Unemployment Statistics

11. MSA Population 20-64 Years Employment by Race In Labor Force Not in Labor ForceEmployedUnemployed RACE AND HISPANIC OR LATINO ORIGIN White66.3%33.7%61.9%6.4% Black or African American65.5%34.5%55.9%14.2% American Indian and Alaska Native62.4%37.6%49.6%15.0% Asian68.9%31.1%65.9%4.4% Native Hawaiian and Other Pacific Islander 73.8%26.2%70.4%4.6% Some other race74.9%25.1%68.5%8.3% Two or more races70.7%29.3%62.9%9.9% Hispanic or Latino origin (of any race)76.9%23.1%70.5%7.8%

12. Louisville MSA Employment by Age In Labor Force Not in Labor ForceEmployedUnemployed AGE 16 to 19 years49.7%50.3%38.0%23.3% 20 to 24 years81.4%18.6%70.0%13.6% 25 to 44 years84.1%15.9%78.0%6.7% 45 to 54 years79.5%20.5%75.3%5.2% 55 to 64 years60.1%39.9%57.3%4.7% 65 to 74 years23.4%76.6%22.5%3.8% 75 years and over5.9%94.1%5.7%2.2%

13. Louisville MSA Employment by Gender and Educational Attainment In Labor Force Not in Labor ForceEmployedUnemployed SEX Male82.9%17.1%76.8%6.7% Female73.7%26.3%68.7%6.8% With own children under 6 years72.1%27.9%65.3%9.3% EDUCATIONAL ATTAINMENT Population 25 to 64 years77.9%22.1%73.0%6.0% Less than high school graduate57.7%42.3%49.6%13.9% High school graduate (includes equivalency) 74.4%25.6%68.8%7.3% Some college or associate's degree 81.6%18.4%76.6%5.8% Bachelor's degree or higher86.2%13.8%83.8%2.5%

15. 2002-20072008-20112010-2011 Manufacturing-10.3%-13.1%0.8% Wholesale and retail trade-1.1%-5.4%1.0% Transportation and utilities13.9%0.2%4.6% Finance and information services8.5%-7.4%-0.6% Professional and business services17.7%1.5%3.4% Education and health services11.4%6.2%1.5% Leisure and hospitality9.3%1.2%3.9% Government4.7%0.2%-2.1% Federal government1.1%-2.0%-16.9% State government-2.1%0.5%-0.5% Local government8.2%0.6%0.8% Job Growth by Sector, Louisville MSA

18. Concluding Thoughts Location quotient – Transportation and warehousing = 2.08 BLS growth projections 2010-2020 – General freight trucking = 18% – Freight transportation arrangement = 23% – Warehousing and storage = 26% – Nonscheduled air transportation = 36% Will our economic development policy build on our strengths?

19. THANK YOU janet.kelly@louisville.edu 502-852-2435