The local economy will continue to show growth in 2014 but not enough to have an impact on the area, according to a new panel of economic experts from Oakland University’s School of Business Administration in Rochester Hills.
From polling a selection of university and industry experts regarding southeastern Michigan’s economy, the report forecasts that the region will experience virtually no population growth; unemployment will decrease modestly from the 9.5 percent forecasted in 2013 to 8.9 percent by the end of next year; and while housing prices are forecasted to grow at 6 percent, this shows a 2-percent decrease from the experts’ forecast for 2013.
“The key thing is that (the panel members) are forecasting for 2014 a continuation of slow growth,” says Jonathan Silberman, professor of economics at Oakland University, which has nearly 20,000 students. “Although within that slow growth, they are forecasting pretty robust gains in U.S. light vehicle sales (15.5 percent), which is very important locally. But even with that, it’s still slow economic growth — that’s good, but not good enough.”
Seven experts participated in the survey and represented organizations including Michigan State University, IHS Automotive, and the W.E. Upjohn Institute. “We wanted a balance of people who are economists at universities and knowledgeable about the local economy and also some industry experts. We hope to expand the (number of experts polled) to 12 for the next report,” Silberman says.
A slow-moving economy was met with a relatively neutral outlook by consumers in the region. In a separate report, also released by Oakland University, consumer confidence for the 2013 fourth quarter was at 50.9 (50 is the level for a neutral outlook). However, despite the low confidence in the national economy, Silberman points out that consumers scored 59.5 for their future expectations regarding personal finances a year from now.
“I think this could be a good sign,” Silberman says. “If (consumers) feel their personal financial position will be better in a year from now, then they’re more likely to increase their spending.”
The results are part of the initial reports provided through Oakland University’s Southeastern Michigan Economic Outlook. The next surveys will be conducted in December, with results available in January. “(These reports) will have more value as we track them over time. Next time, we can talk about that change from one quarter to the next,” Silberman says.