1. U.S. and Tennessee Economic Outlook: 2017
October 2017
Matthew N. Murray, PhD

2. Quarterly GDP Growth—Typical Volatility Around a Stable Trend (chained 2009 dollars)
8/9/17; GDPR; % chg Annual Rate; FRED GDPC1
includes BEA revisions beginning 2011q1 forward
FRED series: GDPC1
Seasonally Adjusted Annual Rate Frequency: Quarterly Units: Percent Change from Preceding Period
DO NOT USE 3-QTR SMOOTHING FOR GDP!!!!!!!
Real Chained 2009 dollars
Growth is calculated using SAAR. (((B/A)^4)-1)*100 – 3 quarter moving average
FRED GDPC1
(SAAR Compounded annual rate)
October 2017

3. Interest Rates and Inflation Rates Low, but Inching Upward
Fed’s recent move pushes
FFs rate to range
8/9/2017 RMFF (level) & CPI (yr-over-year % change)
October 2017

4. U.S. Employment Cost Index: Pressure Mounts as Labor Market Tightens
Source: IHS Markit™, U.S. Economic Outlook, September 2017 (copyright).

5. Brent Crude Price Edges Up—But Where is the New Ceiling?
Source: IHS Markit™, U.S. Economic Outlook, September 2017 (copyright).

6. Industrial Production Slows as Economy Approaches Full Employment
Source: IHS Markit™, U.S. Economic Outlook, September 2017 (copyright).

7. U.S. Productivity Slowdown Expected to Continue
Source: IHS Markit™, U.S. Economic Outlook, September 2017 (copyright).

8. Light Vehicles Sales Return to Pre-Recession Peak: No Room for Acceleration
8/9/2017; IHS series SUVLV // FRED series ALTSALES
October 2017

9. Housing Sales Remain Low for an Expansion and Constrained by Supply
8/9/2017; HUESOLD, HUSPS levels; AUG17 IHS short-term forecast bank
EXHOSLUSA495S
HOUST Fred
Global Insight Baseline for current year
October 2017

10. Housing Starts to Plateau Well Below Pre-Recession Levels
VC model for TN housing permits
Source: U.S. Department of Housing and Urban Development, State of the Cities Data Systems (SOCDS) database; UT-Boyd Center; and IHS Markit™, U.S. Economic Outlook, September 2017 (copyright).

11. Housing Sales Trending up in Tennessee But Dips Along the Way
8/9/2017
Source: Tennessee Department of Revenue, Monthly Revenue Collections, June 2005 to June 2017.
October 2017

12. Nonfarm Job Growth Slows: Current Cycle (Full Employment) and Long Term (Demographics)
1/1/2017
U.S: USJAN17 IHS forecast
TN: ERG2017 forecast (workfile as of Jan 21 from LK)
Source: Bureau of Labor Statistics; IHS, Inc.; and Boyd CBER.
October 2017

13. Population: Urban-Rural Divide is Growing
8/18/2017; S:\CONTRACT\CUNNINGHAM\PPT CHARTS\CNTY MSA LABOR FORCE.xlsx
Source: U.S. Census Bureau, Annual Population Estimates and 2010 Decennial Census.
October 2017

14. Dramatic Differences in Post-Recession Private Employment Growth Across Tennessee (2007 to 2016)
U.S.: 5.7%
-44.1% to -20.0%
-19.9% to -10.0%
-9.9% to 0.0%
0.1% to 9.9%
10.0% to 19.9%
20.0% or higher
Note: Employment covered by the state unemployment insurance program.
08/14/2017
Source: Bureau of Labor Statistics.
52 winner
43 losers
October 2017

15. Full Recovery from the Great Recession in Most Sectors (June 2017 Employment as a Share of December 2007 Employment)
08/9/2017; current to recession peak
Source: Bureau of Labor Statistics.
October 2017

16. Unemployment Rates Bottom Out
1/17/2017: USJAN17 IHS & ERG17 (through 2019q1)
August 2017 Rates
TN: 3.3%
US: 4.4%
Source: Bureau of Labor Statistics; IHS. Inc.; Boyd CBER.
October 2017

17. Labor Force Participation Rates Point to Near-Term Turnaround
8/11/2017
Source: Bureau of Labor Statistics.
October 2017

18. Don’t Blame the Great Recession: Labor Force Participation Rate Peaked in 2000
8/9/ BLS LNS Q; LNS Q; LNS Q
Source: Bureau of Labor Statistics.
October 2017

19. Unemployment Rates Show Significant Variation Across the State
Tennessee: 4.2%*
United States: 4.5%
Less than 4.2%
4.2% to 5.1%
5.2% to 6.1%
Greater than 6.1%
*June non-seasonally adjusted rates.
Source: Bureau of Labor Statistics
BLS downloaded 8/14/2017 || seas adj rate JUN17: TN 3.6%, US 4.4%
October 2017

20. Tennesseans Have Poor Health Status Which Affects Labor Force Outcomes
Disability rates are up for both the U.S. & TN, but TN’s rates are rising more rapidly
2015
Source: Centers for Disease Control and Prevention, Behavior Risk Factor Surveillance System.
October 2017

21. Schedule II Opioid Prescriptions Per Capita, 2015
State average = 1.3
About 80 doses per person
Source: Tennessee Department of Health
October 2017

22. Opioid Prescriptions Per Capita and Labor Force Participation Rates
October 2017

23. Educational Attainment of Persons Aged 25 Years & Older: High School & Higher
Tennessee: 85.5%
United States: 86.7%
Less than 75.0%
75.0% to 79.9%
80.0% to 85.5%
Greater than 85.5%
Source: U.S. Census Bureau, American Community Survey (5-Year Estimates ).
ACS
October 2017

24. Trailing Levels of Educational Attainment Contribute to Trailing Levels of Income and Lower Participation Rates
Percentage of Population Aged 25 Yrs & Older
Percentage of Population Aged 25 Yrs & Older
American Factfinder ACS Table S1501 (various years, all 5-year averages); 08/09/2017
Source: U.S. Census Bureau, American Community Survey (5-Year Estimates, various years).
October 2017

25. Per Capita Income is Lower than the U. S
Per Capita Income is Lower than the U.S. Average in All But Two Tennessee Counties
Tennessee: $42,094
U.S.: $48,112
Less than $35,000
$35,000 to $42,094
$42,094 to $48,112
Greater than $48,112
08/09/2017; current dollars
2015 Per Capita Personal Income.
Source: Bureau of Economic Analysis.
October 2017

26. Boyd Center for Business & Economic Research
Haslam College of Business
716 Stokely Management Center
916 Volunteer Boulevard
Knoxville, Tennessee
Howard H. Baker Jr. Center for Public Policy
1640 Cumberland Avenue
Knoxville, Tennessee
October 2017