2017 Economic Forecast

DAYTON, Ohio (January 2017) – We hear so much about the national economy in the news every day, and should. But how do we believe the regional economy will fare in 2017? Good question.

Coming out of 2016, we felt the economy was showing signs of better growth, especially in the latter half; even with the uncertainty and uneasiness with the November elections. The stock market has certainly flirted with a 20,000 DOW and consumer confidence seems to be much more positive than in 2015. So what are our expectations for the New Year?

These economic questions are always a mixed bag, some good, some better and some concerns. So our chamber’s Research Advisory Council, a group of area economists, investors and researchers, try to map out what we think the New Year will bring us. Here is what we believe 2017 may look like without trying to predict the stock market for you.

2017 should be a positive year for a number of reasons but still at a modest 2% – 2.5% growth rate because of these factors:

Unemployment was still low at the end of 2016 – more people working
Interest rates are still low – access to capital is good
Auto sales in 2016 were some of the best in years – big economic impact
Job growth was good in 2016 – some new regional employers
Construction and home sales were good and new home starts seem to be trending better for that industry
Service industry is still growing
Logistics industry seeing good growth
Healthcare services continued to grow
Manufacturing is doing okay for many employers
Personal incomes grew in 2016 – more consumer income for 2017

This will help us trend up in 2017; but we are still concerned about several sectors:

Government jobs will probably not have much if any growth and more than likely will shrink due to budget constraints.
Retail – brick and mortar may well start to shrink, not just big-box retailers like Macy’s and Limited but others are already announcing store closures due to the impact of internet sales.

The result will be a modest, yet positive year predicted for our region like much of Ohio and the nation. What we just can’t predict is the stocks and bonds markets and if the current positive consumer confidence will carry the market higher in 2017 and beyond.

But we should be optimistic and plan for growth. We should also support every opportunity to grow the education and skill sets of the current and future workforce as this may well be the driving force of our future growth and a strategic advantage for our economy and nation.

In my opinion, the economy feels better in our region right now and I’m glad to be beyond the disruptive and contentious elections of this past fall. Maybe America and our region can turn more of our collective energies towards job creation and economic growth and prosperity for all of our citizens and businesses in 2017.

To download a PDF of the article click here.

Phillip L. Parker, CAE, CCE

President & CEO

Dayton Area Chamber of Commerce