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Idaho Economic Indicators
Aug. 26, 2010
The recession cut deeply into the Idaho economy, claiming over 55,000 jobs between August 2007 and August 2009 – an 8.2 percent decline. Year-over-year job loss peaked at 7.3 percent in July and August 2009. It was the deepest job loss since World War II. In 2006, just three years earlier, Idaho had been among the national leaders in job growth. Since August 2009 the year-over-year gap had been closing steadily until June. While prerecession seasonal employment patterns were returning to Idaho’s labor force picture, some instability remains with the year-over-year job gap increasing in June for the first time since last August. The gap closed again in July. Idaho’s unemployment rate in July held steady at 8.8 percent. Although the rate remained higher than at any other time since 1983, the number of workers on the job in June exceeded the number a year earlier for the third straight month after trailing the year-earlier total for 28 months. Source: U.S. Bureau of Labor Statistics
The total value of all the goods and services produced in Idaho increased modestly in 2008 to $52.7 billion, a 1.2 percent increase from 2007’s revised total of $52.2 billion. The depth of the recession offset productivity gains in the first half of 2008, holding the annual increase to its lowest level since 1986. The 2008 growth rate was 47th nationally. Adjusted for inflation, Idaho posted no growth in real gross state product between 2007 and 2008 percent. Between 2002 following the last recession and 2007, Idaho’s gross state product rose 44 percent, eight points higher than the national rate and the 13th highest rate in the nation. Increased productivity in health care, professional and business services, information, mining, utilities and government during 2008 were offset by the dramatic decline in construction and negative performances in natural resources, trade, financial services and transportation. Manufacturing rose only fractionally. Source: U.S. Bureau of Economic Analysis
The Otter administration estimates general tax revenue for Fiscal Year 2011 at just under $2.37 billion, about $64 million higher than the estimate used by the Legislature to set the FY2011 state budget. The new administration estimate is about 2.7 percent below the revenue estimate made last December and rejected by the Legislature. The lower August estimate was the result of FY2010 revenues coming in $85 million below the administration estimate made in January. However, the administration reported that revenue collections have improved since the year began and the economic outlook is better than it was at the end of 2009, tempering the decline in the new forecast. Source: Idaho Division of Financial Management
In 2009, only 21,862 new businesses filed with the Secretary of State, down 10 percent following a 15 percent decline in 2008. It was the third straight annual decline. The previous decline was in 2001 during that national recession. Source: Idaho Secretary of State
Job Growth
The year-over-year job gap closed slightly again in July after increasing in June for the first time since it peaked at a 7.3 percent loss last August. The state economy lost 6,000 jobs from June to July, slightly more than usual for mid-year. That left total jobs in July at 608,600, 0.4 percent below July 2009. The gap had been closing more the result of job loss being so great in late 2008 and early 2009 and not because the economy was generating many new jobs. The year-over-year loss in July was 2,700, down from 3,300 in June. Nationally, nonfarm jobs were just 0.01 percent lower in July than a year earlier. Construction and manufacturing, which have been adding jobs month to month since February, remained 4,900 jobs below the July 2009 level, accounting for more than the entire year-over-year gap.
High-tech employment, which averaged 56,700 in 2007 and appeared to be gaining momentum, was an early casualty of the recession, declining in 2008 by 2 percent and then plunging 11 percent in 2009 to under 50,000 following major layoffs at Micron Technology and others in the sector including MPC and Hewlett-Packard. Since high-tech manufacturing jobs peaked at 17,300 in November 2006, the state has lost over 7,000. The overall high-tech sector hit bottom in 2003 at 52,127 after peaking two years earlier at 58,159. Employment in 2009 averaged 49,300, its lowest level since 1999. Source: Idaho Department of Labor
Total employment in July slipped 2,400 from June to 690,100, the second straight monthly decline this year. But the total was 3,000 higher than in July 2009, the third month in a row that current employment has exceeded the year-earlier figure after 27 months of year-over-year declines. July was the 18th straight month of employment under 700,000. Total unemployment remained just under 67,000 for the second straight month to hold the unemployment rate at 8.8 percent. Idaho’s labor force contracted for the second straight month in July after expanding for 12 months in a row. The June and July declines were likely a reflection of long-term unemployed who lost their federal extended benefits after Memorial Day because Congress declined to extend that program’s. Those benefits were restored the end of July. The country’s jobless rate was also unchanged at 9.5 percent in July.
After the rapid escalation of Idaho’s unemployment rate that hit every corner of the state, 15 of the 44 counties saw rates decline from June to July. Twelve had double-digit rates, up from 10 in June. The highest was 12.6 percent in both months. Source: Idaho Department of Labor
After the rapid escalation of Idaho’s unemployment rate that hit every corner of the state, 29 of the 44 counties saw rates decline from May to June. Eleven had double-digit rates, but the highest was 12.6 percent. In May three counties had rates at 14 percent and higher.
Rising unemployment drove jobless benefit claims and payments to unprecedented levels in 2009. The regular benefit payout totaled $403 million, nearly double the previous record of $210 million in 2008, and that was nearly double the $123 million in 2007. Another $240 million was paid in federal extended and supplemental benefits in 2009 when over 116,000 workers received assistance through the unemployment insurance program. Regular benefit payments and the number of workers getting them finally slipped below the year-earlier level the last week of 2009 and have been running lower ever since. The regular benefit payout through July was $203.7 million compared to $283.9 million over the same period in 2009. During the suspension of extended federal and supplemental benefits, the weekly total benefit payout in Idaho dropped from over $11 million to under $7 million in July. Federal extended and supplemental benefits resumed at the end of July.
Benefit payments were double the revenues paid into the trust fund in 2008, triggering a 70 percent increase in all unemployment insurance tax rates. While significant, even with the increase, the average effective rate for 2009 was below the 2006 level because rate decreases in both 2007 and 2008 brought the tax to its lowest point on record. But the higher rates in 2009 covered only a third of the regular benefit payments, prompting the state to begin borrowing from the federal government to continue paying benefits in June 2009. Rates hit their legal maximum in 2010, and that will not be enough to cover the anticipated $265 million in regular benefit payments in 2010. Thirty-three other states have gone broke and borrowed from the federal government, and more are teetering on the edge. Idaho has borrowed $202 million through July. Source: Idaho Department of Labor
Personal Income
The wage and salary component of total personal income finally rose in the first quarter of 2010 after six straight quarters of decline or stagnation. That 0.8 percent increase complemented a 6 percent increase in business profits, which rose 5 percent in the final quarter of 2009. The two combined pushed total personal income up 1.3 percent in the January-March quarter to $49.7 billion on an annualized basis. The percentage increase ranked 10th nationally.
Personal income in rural Idaho plunged 3.9 percent from 2008 to 2009, exceeding the 2.5 percent decline in urban personal income. Personal income statewide dropped 3 percent, the first annual decline in personal income in Idaho since 1953. Source: U.S. Bureau of Economic Analysis
Idaho’s per-capita personal income declined 4.1 percent from 2008 to 2009, a loss of $1,362 and the first time per capita income has declined since the information began being compiled in 1969. Nationally, per capita personal income fell 2.6 percent, or $1,028, to $39,138.
Per capita income in urban Idaho declined 0.3 percent in 2008 to $33,412 because of the loss of jobs and paychecks in the Boise metropolitan area. Per capita income in the five-county area was off 1.2 percent from 2007, also the first decline for that area since 1969. The other four metro areas posted gains, albeit modest ones. Per capita income in the 367 metropolitan areas across the nation rose 2.2 percent.div>
Idaho's 33 rural counties combined saw a per capita income gain of 3.9 percent to $29,627 in 2008, but that was only half the percentage increase rural Idaho saw in 2007. Source: U.S. Bureau of Economic Analysis
Idaho Exports
After hitting a record of nearly $5 billion in 2008, foreign sales of Idaho goods and services plunged during the first half of 2009 before finally reviving to more than $1 billion a quarter again in the second half of the year and the first three months of 2010. Foreign sales totaled nearly $3.9 billion in 2009, the third best year on record but still 22.5 percent below the 2008 total. The $1.2 billion sold in the first quarter of 2010 was still 5 percent below 2008’s record pace.
The early 2009 decline in exports followed the bottom falling out of the computer chip market. Chip sales rebounded slightly in the second quarter before posting a solid 38 percent gain in the third quarter. Sales slipped fractionally in the fourth quarter, ending the year with a 26 percent decline in chip exports. High-tech exports, primarily chips, continued to slide in early 2010, and accounted for only 53 percent of total foreign sales, the lowest quarterly percentage on record. Source: Global Trade Information Services of the U.S. Census Bureau
The recession victimized Idaho’s tourism industry, slashing revenues and the tourism taxes they produce by 12 percent in 2009 from 2008’s record receipts of $407.6 million. Lodging revenues during the first seven months of 2010 at $177.4 million were off 3.7 percent from January-July\ 2009, which was off 14.8 percent from the first seven months of 2008. Total receipts in 2009 at $358 million were the lowest since 2005. The industry saw a sluggish first half of 2010, but July receipts at over $43 million were the fourth highest for July on record. Tourism has been estimated to account for about 5 percent of Idaho’s gross state product. Source: Idaho Tax Commission
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