Cathie Rowand | The Journal Gazette Charles Trzcinka talks at the Economic Outlook Friday IPFW Walb Union Interantional Ballroom
Cutter Cathie Rowand | The Journal Gazette Ellen Cutter at Economic Outlook
Saturday, November 21, 2015 3:26 am
IU economists say '16 will feel familiar
Sherry Slater | The Journal Gazette
If you liked this year’s economy, you’re in luck. Economic experts expect more of the same in the coming year.
In fact, Indiana University economists have nicknamed 2016 the "Groundhog Day" forecast, referring to the 1993 movie in which Bill Murray’s character lives the same day again and again.
They are calling for 2.5 percent real U.S. gross domestic product growth in the coming 12 months, which is slightly higher than experienced in the previous 12 months. GDP measures the value of all goods and services produced.
About 300 people attended the 2015 Economic Outlook Panel on Friday, one of a statewide series of similar events. The lunch was co-sponsored by Greater Fort Wayne Inc. in IPFW’s Walb Student Union.
Willard Witte, associate professor emeritus of economics, talked about the national and international landscapes. Charles Trzcinka, finance professor, looked at what’s ahead for Wall Street. Ellen Cutter, director of the Community Research Institute at IPFW, presented a local economic forecast.
Using notes prepared by Timothy Slaper, Trzcinka also delivered a statewide forecast. Slaper, director of economic analysis at the Indiana Business Research Center, was called away on an emergency.
Witte, who spoke first, warned that if his forecast of 2.5 percent national GDP growth is wrong, it will likely turn out to be too optimistic.
"I think the glass is half empty rather than half full," he said.
Factors that could slow the economy include uncertainty in Europe as it deals with terrorism; "enormous structural problems" in China’s economy; and unanticipated consequences of the Federal Reserve gradually but steadily increasing interest rates, Witte said.
Trzcinka forecast stock market growth at less than the historical average of 10 percent. One drag will be the strong dollar, which hurts exporters because overseas customers can’t afford to buy as much merchandise.
Slaper is calling for Indiana’s economy to grow next year at 2.5 percent, a figure he described in his notes as "a slightly faster rate" than the U.S. overall.
Cutter focused primarily on employment. Although she had forecast a year ago that the Fort Wayne metropolitan statistical area would pass peak pre-recession employment levels during 2015, that hasn’t happened. The three-county MSA – comprising Allen, Wells and Whitley counties – is still about 4,000 jobs away from that high, she said.
Data show that about 4,500 jobs have been created in the past year, with about 1 in 4 in health care, Cutter said.
Although that number includes numerous part-time jobs in restaurants, retail stores and various entertainment venues, Cutter said the positions are important because they support the area’s quality of life.
During a short question- ;and- ;answer session, Witte addressed various economic factors that affect college enrollment. That discussion was of particular interest to June Kim, who started teaching economics on the IPFW campus this semester and attended the Economic Outlook.
Among the factors, Witte said, are that some students will drop out of school when wages are high because they want to start earning immediately.
Meanwhile, he said, other people will enroll in classes to acquire the skills they need to qualify for those high-paying jobs.
Harrison Diedrich, an IPFW freshman, said he wasn’t discouraged by the fact that the experts are calling for only slight improvements in next year’s economy.
"It is what it is," the 19- ;year- ;old business management major said.
"All we can do is bear down the hatches and see how it goes."
Diedrich was more positive about the event itself.
"It was just very insightful," he said.