Portland Economist Warns: Recession Impacts Economy
Portland is currently facing significant economic challenges, according to economist Mike Wilkerson. He presented his findings at the Portland Metro Chamber’s annual State of the Economy breakfast. Wilkerson’s insights indicate that factors like job losses, population stagnation, and insufficient housing construction have contributed to the region’s recession status.
Key Economic Indicators in Portland
- Job losses: Multnomah County has lost 6,000 jobs over the past year.
- Total job losses: Approximately 33,000 jobs have been lost since the onset of the pandemic.
- Unemployment rate: As of December, the unemployment rate in Multnomah County stands at 5.0%.
- Historical context: The county’s average unemployment rate has been 5.9% for the 21st century.
Wilkerson highlighted that the economic downturn affects various sectors. This includes construction, manufacturing, and professional services. He warned that without significant changes, the region is likely to continue experiencing adverse outcomes.
Contributing Factors to Economic Decline
Several factors are exacerbating Portland’s economic situation:
- Real estate investors are showing a growing disinterest in Portland.
- Residents exhibit increasing pessimism regarding their financial futures.
- The area faces a shortage of new housing development.
- Oregon has some of the highest personal income taxes in the nation.
- A global trade war that disproportionately impacts a trade-dependent state like Oregon.
Potential Paths for Recovery
To recover, Wilkerson emphasized the need for strategic changes. The region must attract new businesses and residents while improving income levels and making housing affordable. Another vital step is reforming Oregon’s tax system to lessen its dependence on income tax revenue.
Future Economic Predictions
Despite the bleak outlook, some economists remain cautiously optimistic. State economists recently projected steady job and income growth over the next two years. This forecast encompasses the entire state, with the Portland metro area being a significant contributor to Oregon’s economic performance.
While ongoing unemployment claims remain high, state economist Carl Riccadonna noted that they do not indicate a recession in the traditional sense. Recent federal data shows that Oregon’s economic output grew faster than the national average last summer.
Riccadonna mentioned that the regional economy might have reached its lowest point and could be on the cusp of recovery. Economic stabilization is a possibility if strategic actions are taken to address the challenges facing Portland.
