1. New Hampshire and New England Economic Outlook December 15, 2011 Ross Gittell NEEP Vice President James R Carter Professor, UNH Chancellor – Elect, CCSNH

2. New Hampshire Outlook Summary: Slow Recovery of Jobs and in Housing Market y The forecast for NH is for the economy to grow slowly for the remainder of 2011 and 2012 and not to pick up momentum and grow above 2% per annum in employment until 2014. y The expectation is that NH will not return to pre-recession employment level and recover 4.6% (30,000) job loss until 2014Q2. This is earlier than the region (Q2 2015) and about the same time as expected recovery of job loss nationally. About 40% (13,000) of jobs have been recovered so far… y NH unemployment rate is forecast to remain at around 5% (5.2% currently vs. US 8.6%) throughout forecast period. This is well below expected national rate and below regional rate. y Housing prices.. slight decline then flat prices are expected to continue in NH until early 2013 and then increase only modestly.

3. Gross Product Annualized % Change. Slow growth. NH growth forecast to average below 3 percent until mid-2014. Peaking (only) at 3.4 percent annualized growth in 2015. Slightly above regional and US growth until 2013.

4. Total Employment annualized % change 2007Q3 through 2015Q2. Annualized growth in employment in NH, US, NE region all expected to remain below 2% until late 2013. NH above or at US growth rate until end of 2013 and then slightly below. NH remains above NE ave

5. Recovery by Sector -- Trough-to-2015 Q2 % Change Employment. Strongest sectors in NH are Prof & Bus and Leisure. Weakest are Construction, Manuf., Trade and Finance. Prof & Bus, Info, High Tech and Leisure growing faster in NH than US other sectors same or lower growth in NH. Concerns about health services sector

6. Total Employment Trough-to-End of Forecast % Change. Vermont only state with above US growth forecasted in NE, followed by NH. Maine and Connecticut expected to have lowest growth.

7. Unemployment Rates. Peak and at end of forecast period. VT & NH the lowest, then MA. Other states closer to US average. RI forecasted to retain highest rate in region.

8. Median Housing Price Trough to End of Forecast. NH and Connecticut expected to have the slowest recoveries in the region and prices only expected to start to slowly increase in early 2013. The increases in median price are expected to be highest in Vermont and Maine in the region

9. Longer Term Growth: What is the NH Advantage? NH has had stronger employment growth than bordering states and US average since 1980. Key to long term growth is differential growth coming out of recessions, early 1980s and early 1990s. For that to be the case again.. Need an supply of skilled labor with the appropriate skills

10. Longer Term Growth: What is the NH Advantage?

11. Net Domestic Migration as % of Population. A source of skilled labor in the past. NH from in top 10 to 45 th of 50 198919992010 Rank% % % Maine90.93180.1341-0.19 Mass35-0.4131-1.736-0.14 NH51.2370.745-0.28 VT80.96220.0131-0.02 TopFL3.25NV2.33ND0.86 BottomWY-2.01HI-2.2Michigan-0.78

12. Young Adult Cohort, 18-34.. Another important source of labor to meet new demand coming out of recessions. Entry Level Workers. NH went from one of the top states with highest percentages to 49th 18-34 1990 Rank% 2000 Rank% 2010 Rank% Maine3726.8%5020.5%5019.6% Massachusetts330.1%2023.7%2123.3% New Hampshire1029.1%4721.3%4920.3% Vermont1828.2%4521.5%4421.5% TopAlaska30.7%Utah28.9%Utah27.6% BottomMontana24.2%Maine20.5%Maine19.6%

13. Looking Forward: CCSNH and NH’s Economic Outlook y Important time to strengthen the connection between post-secondary education and the economy… important for the economy, for the competitiveness of NH companies/industries, for NH students, and for advancing opportunity more broadly across the state y National and NH surveys showing that about 40 percent of the college graduates available to employers do not have the necessary applied skills to meet their needs, and that nearly one-third of manufacturing companies are suffering from some level of skills shortages y 64% of NH jobs will require post-secondary education by 2018 and currently only 46% of NH adults have post-secondary degree (Georgetown Center on Education and the Workforce)

14. CCSNH and NH’s Economic Outlook y The largest group of job opportunities over the next decade will be in “middle-skilled” jobs (about 40%). Jobs that require beyond high school but less than 4-yr college degree y Strengths of Community Colleges – Agile and Market and Community Driven -- open door policy, low tuition/cost, flexibility, ties to industry and community based. y CCSNH at important point in its development with its recent independence.. CCSNH can be flexible and response to the needs of NH students and workers and the economy/market y And CC are important bridge to bachelors degree for increasing number of learners… for affordability and “real world” and “workforce ready” relevance.

15. NH Community College Background Information y Over 50% of adults in NH do not have an associates degree or higher (54%). 2/3 rd do not have a 4-yr degree y Largest group, 27% has high school as terminal degree.. These adults can be prime cohort for community colleges y 20% have some college… these adults can also be target cohort for community colleges. y Percentage of Adults with college degree in NH varies greatly across the state from 30% in Coos and also under 40% in Sullivan, Belknap, Carroll and Cheshire to near 50% in Rockingham, Hillsborough (still it is not close to 64% in any county) yIn NH 10% have Associates Degree, compared to 8.4% nationally

16. Working Families & Communities and the CCSNH y Community colleges are important in helping lower income workers move into the middle class and for helping middle class workers to stay in the middle class. A significant percentage of CCSNH students are upgrading skills and retraining. y Individuals with an associate’s degree earn between 20-30 percent more than their high school only counterparts (Grubb) and they are more likely to stay in their communities and in state than 4-yr degree graduates.

17. Some Hope in Demographics y Positive news out of the 2010 Census is that since 2000 New England has gained over 200,000 college age residents ages 18 to 24. y “Workforce ready” education in NH will support a strong entry level workforce and employment and economic growth in NH

18. NH Outlook Summary y NH is expected to continue to experience slow growth and slow recovery in the jobs lost 2008 to 2009. y The forecast is for the state to grow slowly for the remainder of 2011 and 2012 and not to pick up much momentum and strength until well into 2013. y Longer term strong influence of workforce demographics and workforce education and training on the economic outlook.