A new year is dawning and with it a new President. Donald Trump was inaugurated on the 20th of January 2017 and his approach will create significant changes in the US economy. It’s too early to tell what those changes will be, but we can assume they will be pro-business. That should be good for real estate investors.
Oregon has had an exploding economy. You can tell by the clogged Portland area freeways that there are more people her that the existing infrastructure can support. The Oregon legislature knows that, and will be bringing legislative bills to the table to help. Unfortunately, this all takes time and we will probably not see the impact of decisions made in Salem for five years.
The good news is that the Portland job growth is averaging 2.7% over the last year (source the Oregon employment department), with significant growth in construction, education, health, hospitality and government services and no growth in mining, logging or manufacturing.
Statewide Oregon has had significant job growth as well as documented by the U.S. Bureau of Labor Statistics. In September of 2016 Oregon ranked second in the country for its strong job growth rate.
- September 2016 year over year rankings for job growth top 5 states
- #1 Florida
- #2 Oregon
- #3 Idaho
- #4 Washington
- #5 Utah
The unemployment rate in the Portland Metro area is hovering at about the 4.6 percent range.
|November 2016||Unemployment rate|
|Washington State||Clark County||5.7%|
Data from the St. Louis Federal Reserve (https://fred.stlouisfed.org/series/WACLAR1URN )and the State of Oregon Employment department.
Balancing these low unemployment rates are the fact that Portland seems to have an unstoppable in-migration of over 100 people per day( Thank you Portlandia).
Job related challenges that Portland companies face in the coming year include:
- The continued job churn as Millennials try to find the job they like the best
- The reduction of illegal immigrants ( re president Donald Trump and his wall to Mexico and reduction in H-1B Visas.)
- Businesses will try to adjust by continuing to automate where ever they can to reduce employee head count.
Never the fewer wage will continue to increase and new Portlanders will need housing. The critical question will be is Portland businesses can pay the employees enough to cover the significantly increased market rents.
Economists believe that the current national economic expansion should continue into 2017, albeit at a slower rate.