update and considerations marin county construction may 28 ... · marin county construction may 28,...
TRANSCRIPT
Update and Considerations Marin County Construction
May 28, 2020 –Webinar for MBA
Robert Eyler, PhDChief Economist, Marin Economic Forum
Professor, Economics, Sonoma State [email protected]
1
Monetary Policy
Fiscal Policy
Social Policy
A Tale of Three Policies
2
Bigger once social policy fades
Weekly Claims: Have we already peaked? Feb –May 2020
3
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
US Weekly New Claims for UI California Weekly New Claims for UI
Source: Federal Reserve and EFA
Philadelphia Fed Survey of ForecastersQ1 2020 GDP = -5.0%; U Rate = 14.7% April
4
Source: Philadelphia Federal Reserve Branch
0
50
100
150
200
250
300
350
400
450
500
Jan
-19
90
Dec
-19
90
No
v-1
99
1
Oct
-19
92
Sep
-19
93
Au
g-1
99
4
Jul-
19
95
Jun
-19
96
May
-19
97
Ap
r-1
99
8
Mar
-19
99
Feb
-20
00
Jan
-20
01
Dec
-20
01
No
v-2
00
2
Oct
-20
03
Sep
-20
04
Au
g-2
00
5
Jul-
20
06
Jun
-20
07
May
-20
08
Ap
r-2
00
9
Mar
-20
10
Feb
-20
11
Jan
-20
12
Dec
-20
12
No
v-2
01
3
Oct
-20
14
Sep
-20
15
Au
g-2
01
6
Jul-
20
17
Jun
-20
18
May
-20
19
Ap
r-2
02
0
US Housing Starts West Region Housing Starts
Housing Starts, US and West Region (CA largest state), Jan 1990–April 2020
5
Source: Federal Reserve and Census Bureau
Housing Forecast, 2020, as of April 2020% Growth, Looking One Year Forward, California
Source: Zillow Research
-0.6
-1.4
-1.7
-2.4
-3.7-4.0
-3.5
-3.0
-2.5
-2.0
-1.5
-1.0
-0.5
0.0
0.5
Cal
ifo
rnia
Sacr
amen
to
San
ta C
lara
Los
An
gele
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San
Mat
eo
San
Die
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Ora
nge
Ala
med
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Fre
sno
Lake
Sola
no
San
Jo
aqu
in
San
ta C
ruz
Cal
aver
as
Pla
cer
Son
om
a
Del
No
rte
Mar
in
San
Lu
is O
bis
po
Lass
en
Mo
nte
rey
Gle
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San
Fra
nci
sco
Shas
ta
Co
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ost
a
Me
nd
oci
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Riv
ers
ide
Ven
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Nap
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Co
lusa
El D
ora
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Hu
mb
old
t
Plu
mas
Ne
vad
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Mo
do
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Bu
tte
Per
cen
tage
Ch
ange
to
Ap
ril 2
02
1
Jobs Lost (% Change from Previous Year), US and CA in April 2020, Selected Industries
7
Source: Bureau of Labor Statistics and EFA
-13.2%
-2.1% -2.7%
0.5%
-14.8%
-8.4% -8.7%
-12.4% -14.5%
-1.8%
-8.0%
-17.3%
-28.3%
-45.9%-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
US CA
So What for Marin County Builders?
• Shapes expectations for homeowners, developers and governments
• Interest rates at lower levels should help
• Equity market recovery should help
• Long duration of unemployment and more existing units coming on line may not help new build, might help remodel
• Shifting structure: retail and restaurant losses, also some jobs to re-model and re-configure
8
Things to WatchMarin County Construction
9
Jobs Changes, April 2019-April 2020. % Change, Selected Industries, CA and North Bay
10
-14.1%-14.7%
0.0%
-4.2%
-15.3%
0.0%
-3.8% -3.6%-7.7% -7.0%
-44.6%
-28.1%
-6.9%
-70.0%
-60.0%
-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
CA Marin Sonoma
Construction by Subindustry, Jobs Changes, April 2019 to April 2020, California, % of April 2019
11
-14.5%
-2.9%
-4.0%
-8.5%
-9.3%
-10.0%
-11.5%
-11.9%
-18.8%
-19.3%
-23.3%
-30.0% -25.0% -20.0% -15.0% -10.0% -5.0% 0.0%
Construction
Other Heavy & Civil Engineering Construction
Highway, Street, & Bridge Construction
Nonresidential Building Construction
Utility System Construction
Land Subdivision
Residential Building Construction
Building Equipment Contractors
Other Specialty Trade Contractors
Building Finishing Contractors
Building Foundation & Exterior Contractors
-30.0%
-25.0%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Jan
-01
Sep
-01
May
-02
Jan
-03
Sep
-03
May
-04
Jan
-05
Sep
-05
May
-06
Jan
-07
Sep
-07
May
-08
Jan
-09
Sep
-09
May
-10
Jan
-11
Sep
-11
May
-12
Jan
-13
Sep
-13
May
-14
Jan
-15
Sep
-15
May
-16
Jan
-17
Sep
-17
May
-18
Jan
-19
Sep
-19
Marin County CA
Construction Employment, % Change, California and Marin County, Jan 1999 - April 2020
12
Source: Federal Reserve and California EDD
Labor
13
Source: Google Images
Land Use: the debates to come
14
Source: Google Images
Public Sector
15
Source: Google Images
What to Watch
• Labor market changes: need to avoid business losses
• Loss of labor force
• Residential contraction of spending on remodeling
• Commercial real estate scramble
•Housing and re-model market movements: where will local residents go?
•Policy: the lift is coming, how we lift is key
• Really about 2021 and forward in terms of confidence
16
