Recently, I had my meeting for the Maine Consensus Economic Forecasting Commission (CEFC) where we were to update our economic forecast for the state–here is the link to the February CEFC report. Unfortunately, there was no data to suggest that Maine is coming out of the recession. Rather, it appears as if the economy is stuck in neutral.
This quote below succinctly states the economic conundrum the CEFC grappled with:
There has been little change in the job market since the CEFC met in late October. From the start of the recession through the summer of 2010, Maine lost nearly 30,000 nonfarm jobs on a seasonally-adjusted basis. Annual benchmark estimates to nonfarm payroll jobs estimates (to be released in early March) indicate the number of jobs to be virtually unchanged from September 2010.
The unemployment rate in Maine has declined to 7.0 percent in November and December, after peaking at 7.8 percent in June 2011. However, changes in the unemployment rate over the course of 2011 were driven in large part by changes in the labor force participation rate, not due to changes in the number of jobs.
Overall, we stayed the course with our former forecast showing virtually no employment growth in Maine’s economy over the coming year. There are still some troubling, persistent negatives in Maine’s economy. For instance, heating oil prices are stuck at historically high levels and there was a surprising uptick in foreclosure starts. Naturally, the two may be related as heating costs may have pushed distressed homeowners over the edge.
Our next meeting won’t be until the fall and hopefully the economic picture will become clearer, especially in regards to the European debt crisis. At the same time, the Presidential elections will create its own uncertainty as the federal government struggles with the budget crisis. Never a dull moment for the CEFC :-)