'Light at the end of the tunnel'
| December 12, 2010 8:00 PM
Finally, after two long years of crippling recession, the national economy is starting to recover.
Or so says the Wells Fargo Economics Group, a collection of economists and analysts that recently published its 2011 Economic Outlook Report. The 28-page document, which was sent to The Press this week, predicts a healthier real estate market, a diminished unemployment rate and a job-friendly private sector.
"The coming year may provide opportunities for economic growth and expansion," the Wells Fargo economists said, and "we believe the U.S. economy will eventually improve."
Consumer spending will likely increase in 2011, the economists claimed. Unemployment rates should also improve, and personal income should rise.
In the private sector - that part of the economy not controlled by the United States government - the Wells Fargo team expects nationwide hiring to increase by 40,000 jobs per month next year.
Locally, however, the recovery has been slow-moving, and unemployment remains high. Kootenai County's unemployment rate was 10.8 percent in October, according to the Idaho Department of Labor (November stats will be available next week). Statewide, the November jobless rate was 9.4 percent, up from 9.1 percent the month before.
"I think people are still cautious," said Chad Oakland, a Realtor from Coeur d'Alene. "I don't think our economy's fixed by any means. (But) I think there's light at the end of the tunnel."
IDL Regional Economist Alivia Body said the employment situation in Kootenai County is getting better. Non-farm payroll jobs have increased slightly over the past year, and manufacturing jobs, while still declining, have begun to stabilize and recover.
In November alone, 230 job openings were registered through the IDL Kootenai County office, Body noted. Forty percent of those jobs were in the administrative and support services industry; 19 percent were manufacturing positions.
"(This) quarter compared to the quarter of last year is significantly better," she added.
The county's health industry has done particularly well.
"Health care during the recession has been tremendous, increasing 9.2 percent," Body said. "(It) added about 650 jobs in Kootenai County. Our median age is a bit older than the rest of the state (38). Health care will continue to be one of those mainstay jobs."
According to the Wells Fargo economists, real estate and housing - two good barometers for economic recovery - are also on the mend.
"In 2011, we expect trends in commercial and residential real estate to turn positive for the first time since the beginning of the recession," the group said. "Despite being near record lows, housing starts will begin to gain momentum."
Joel Elgee, a Realtor with Coldwell Banker Schneidmiller and a board member on the Coeur d'Alene Association of Realtors, said he's been seeing some positive signs. Three major factors indicate the health of the real estate market, he said: The number of sold properties (demand); the number of homes for sale (supply); and the price of property.
Sales have increased this year, Elgee said, which means demand is up. And at the end of September 2010, Coldwell Banker listed 806 fewer homes on the local market than it did in the fall of 2009. The overall supply, including both residential and commercial properties, is down 10 percent, Elgee said.
"Ultimately, the effect it's going to have, is prices should edge back up," he added. "We predict that in 2011 we're going to see almost level values. We're not there yet, but certainly we're heading in the positive direction. Pieces are falling into place. And that's all we can hope for at this time."
Sonja Hendricks is one person who believes the recession is over. The Coeur d'Alene resident has been busy at work, and recently applied for and received a new credit card, she said.
While Hendricks is confident the economy will recover, it's hard for some people to have hope, she said, because, "Everything they see on TV they believe. I don't believe everything I see on TV."
She said she thinks the U.S. government is a mess right now, but the economy will eventually get back on track.
"I feel like there's been a mess many times throughout history, and this is just another one to get through," Hendricks said.