CLEARWATER – Though the state is on “wobbly knees,” it will see the kind of growth in 2014 that Floridians were used to before the Great Recession occurred, an economist predicts.
“I think 2012 is our new runway, and when we get to 2013, we should begin to take off again,” said Sean Snaith, director of the University of Central Florida’s Institute for Economic Competitiveness, at a Central Pinellas Chamber of Commerce event Jan. 10.
He told area business leaders during the economic forecast session at Sheraton Sand Key that he thinks Florida’s housing market has a long way to go, but added that the current real estate downturn is an once-in-a-lifetime event. Unemployment, he said, though above the national rate, continues to decline as well.
“Job growth. You know I think Orlando, Tampa, ‘Tamppando,’ ‘Orlampa,’ – whatever you want to call it – I think that region is the new breadbasket for Florida as far as growth rates are concerned,” he said.
The Miami metro area is huge but hemmed in; it doesn’t have space to grow, Snaith said. “We don’t have those things in Central Florida.
Snaith said the area between Tampa and Orlando has room to grow and the two metropolitan areas will interact with each other.
“I think this is where the job growth is likely to be the highest in the state going forward,” he said.
“I think we are in a good position. It’s been long, it’s been difficult. It’s a cycle, but it was a heck of a cycle. And as we come out of the cycle – cycles always reverse themselves – I think we’ll see prosperity return to the area.”
Snaith said he doesn’t think the country is slipping back into a recession.
“I think we are going to continue to see a recovery that is slower,” he said,
However, lost wealth and the labor market are taking their toll on the economic recovery. After a long and deep recession such as the one the county has been through, there is a lot of pent-up demand; consumers are afraid to spend, he said.
“Ninety percent of us were fortunate enough to remain employed during the Great Recession, but that doesn’t mean we weren’t scared, and we held back on spending.”
Once the pent-up demand is released and consumers start spending more, Americans can expect a robust economy, Snaith said.
One of the problems is the country hasn’t recovered “an iota nationally of the lost home equity” caused by the housing crisis.
For a lot of people, their home is their nest egg.
“Now this nest egg is Humpty Dumpty on the ground,” he said.
To fix the shattered nest egg people must save more. But if people save more, then, naturally, they are spending less.
“So you have 70 percent of the economy dealing with this lost wealth, and that I think is a burden that is going to persist,” he said.
Speakers also included Susan McManus, a professor of public administration and political science at the University of South Florida and a political analyst for WFLA-TV8.
Looking at recent polls, McManus said, the economy weighs heavy on Americans.
Politicians on the campaign trail aren’t doing a “very good job of creating a more optimistic outlook for this country,” she said.
“And I think you are going to see the fourth wave election in recent history, and that is where people get washed out and bring somebody new in because they are simply impatient when they can’t see any hope in Washington of resolving things,” McManus said.
A question asked in December was, is government the problem or the solution to the country’s economic woes. Sixty percent answered it was the problem, McManus said.
“We are seeing a shaking of confidence in our whole election system of democracy,” she said, calling such numbers troubling.
People hate Congress, McManus said, pointing to a poll showing a 13 percent approval rating for Congress.
“We have never ever seen that kind of feeling among the constituents,” she said.
The “disconnect” begins over the wealth difference between Congress members and the average American.
“Are our Congress members corrupt? More people say yes than no by far,” she said.
Polls show a large number of people say the tax system is so bad that Congress should start a new system, she said.
“People don’t like taxes, either. They feel that tax cuts help the economy more than they hurt the economy,” she said.
This year is shaking up to be “an us versus them kind of election,” McManus said.
Polls also show that candidates have failed to come up with good ideas, especially compared to those running in 2008. They also don’t feel that campaigns are working as the election process should.
“The president’s job approval has never been as bad as Congress – it’s on the upswing lately – but it is neck and neck, even,” she said. “He doesn’t start from the same negative landscape as does Congress.”
If the economy gets better, Obama’s going to be real elected, she said.
“If it stays bad, chances are, he may not,” she said. “Presidents get all the credit when the economy is great; they get all the blame when the economy is bad. So who is going to win? Your guess is as good as mine.”
Also speaking to the chamber was Geary Havran, president of NDH Medical, a major medical device manufacturer in St. Petersburg.
“Probably our best-kept secret is that Florida ranked second only to California in the number of FDA registered device manufacturing facilities in the United States,” he said.
There are about 500 medical device companies that are registered with the FDA in Florida.
The industry has more than 20,000 direct employees in the state of Florida. The average wage is approaching $60,000 a year.”
According to a USF study, there are more than 11,000 people employed in medical device manufacturing in the Tampa Bay area. The payroll exceeds over $600 million and the industry does more than $1.2 billion in revenue in the area.
“Unlike many, many industries, medical devices is one of the few that actually has a positive balance of trade. We end up exporting more than we import,” he said.