The Austin Chamber hosted an Economic Outlook luncheon for the tenth year on Tuesday, December 15, 2015.
Gene Austin, Chairman of the Austin Chamber of Commerce and CEO, President and Director of Bazaarvoice introduced the event speakers and panelists who represent a variety of industries.
Glenn Hegar, Texas Comptroller
Ted C. Jones Ph.D., Chief Economist and SVP for Stewart Title, parent of Gracy Title
Nikki Graham, Austin Market President, Bank of America
Daniel Culbertson, Economist at Indeed.com
Dr. F. John Mathis, VP and Dean, Global Economics & Finance Professor Emeritus, National American University
Graham started off the event with notes on how Central Texas’s growth comes through research, development and innovation. She highlighted Bank of America’s upcoming Market Outlook event as a deeper dive into the research and investment forecasting.
Dr. Jones furthered the conversation by focusing on Austin’s real estate. Austin has hit an all-time record for home sales under the strictest lending conditions. Investors are borrowing money today at the cheapest rate of our time. This makes commercial investment a good deal. In closing Dr. Jones encouraged attendees to watch unemployment.
“Austin does well when oil prices go down, but unemployment rises a little bit – and rises for unskilled labor,” said Jones.
Dr. Mathis focused on Austin’s economy as it fits into the national economy. He described how the Austin economy was unique. When you compare business investment to personal consumption, personal investment is stable and business investment is volatile. GDP mostly tracks business investment. New investment requires taking risks. He gave the following advice to businesses: buy down debt, delay debt funded expenditures, invest in key employees and watch for acquisition opportunities.
Culbertson shared Indeed.com’s proprietary and public data with the audience, which points to a steadily tightening national labor market, with unemployment down to 5%, which is near full employment. At Indeed.com, job postings across all sectors, except oil and gas, have increased. Culbertson indicated that soon the Fed is likely to gently raise rates, and that manufacturing and construction, which are easily influenced by interest rates, are areas to watch.
Comptroller Hegar addressed Texas’ economy and whether it would continue to outpace the national economy. He mentioned oil and natural gas jobs and the lowering price of oil as a statewide concern. The state should continue to have significant assets that contribute to a tailwind effect, including a high rate of young workers, one of the best business climates in the nation, and a better cost of living than most states. In the Comptrollers Office's recent Certification Revenue Estimate, they estimate $2.6B less in state tax revenue for 2016, but that this was on the heals of 60 straight months of year-to-year growth. In the next few years, Texas’ outpacing of the national economy might tighten, but Texas will fare well in the long term.
Here’s a look at the social media conversation around the event:
Overall the state of the Austin economy is growing and should continue to succeed as compared to the nation. With a careful eye on education, training, economic diversification and leadership, Austin can keep its momentum.
“Texas is a good place to do business. It’s a good place to call home. I still thank God that I get to call Texas home,” said Comptroller Hegar.
Here is an article on the 2015 Economic Outlook event in Community Impact.
Greater Austin Chamber
The Greater Austin Chamber of Commerce focuses on how the Austin Region works. We serve as the voice of business for 2,800 organizations representing a combined workforce of about 330,000 employees throughout Central Texas. Our mission is to provide leadership that facilitates the creation of a prosperous regional economy and effective advocacy for members.