I attended the Mid-Year Economic and Financial Update seminar at the Burnham-Moores Center for Real Estate at the University of San Diego on July 24, 2014. This event was a real treat for us “economy geeks”. It was our pleasure to listen (and question/interact with) two economists pontificating on both the national and local economy, as well as the current economic outlook for the remainder of the year.
Nationally: Mark Fleming, PhD informed us that 18% of the GDP is the housing sector. Aspects affecting this sector include limited housing starts, lackluster existing home sales, construction employment and builders’ lack of confidence. He painted a bleak picture. In addition the Millennial Generation postponing buying homes due to a lack of interest and, more importantly, a large amount of student debt. However, interest rates were projected to remain flat for the remainder of the year!
Local economic outlook is brighter than on the national scale. Employment in San Diego has grown and recovered all the 29,000 jobs lost in the Great Recession. The professional and tech sectors are our major contributors here. Also, San Diego recently enacted a higher minimum wage law at the time of the conference. There was a great deal of discussion on how this new requirement would fair for both the business leaders and employees. The economists did seem to agree that the added cost would create further under-employment in the city.