Florida’s economy might not be booming as robustly in 2019 as the past couple of years but talk nationwide of a possible recession this year probably won’t slow the state down too much.
That’s the theme of the economic forecasts presented Monday morning at the Florida Chamber Foundation’s Economic Outlook and Jobs Summit in Orlando, with Florida Chamber of Commerce President Mark Wilson leading the way by declaring that Florida appears positioned well.
“If Florida was a stock, we’d be buying all of it we could, because so many things are happening in Florida right now,” Wilson told a gathering of a few dozen business and economic leaders at the Guidewell Innovation Center in Orlando’s Lake Nona area.
“We believe that Florida once again will continue to set the pace for the rest of the country,” Wilson said.
Jerry Parrish, the chief economist for the Florida Chamber Foundation, projected 150,000 new jobs to be created in 2019 in Florida. That’s down from last year’s forecast of 180,000 jobs for 2018, and from the actual number, which was 196,600, at least through November, compared with November 2017.
This comes as some national economists are looking cautiously at 2019, with a few economic indicators signaling uncertainty, including the stock market volatility, and the interest rate yield spread between long-term and short-term investments, indicating money is moving away from more near-term investments and into safer, longer-term funds, Parrish noted.
“Job creation is slowing in the state of Florida. But remember, we’re faster than everybody else. I still expect us to be growing faster than the U.S. rate,” Parrish said.
Wilson, Parrish, Florida Chief Financial Officer Jimmy Patronis and other economists and leaders laid out a number of reasons why Florida’s economy is strong, including jobs growth, the population increase, housing starts, diversification of the economy, and political leadership, with Wilson mainly expressing relief that Republican Gov. Ron DeSantis defeated Democrat Andrew Gillum in the fall.
In particular, they highlighted:
— Florida’s population is growing by about 900 people a day.
— Florida’s economy is growing by almost $1 million per hour. “So much income is moving into Florida that we track it by the hour,” Wilson said.
— Florida’s economy is diversifying,
This year, Wilson said, Florida moved up from the 24th most-diverse economy in the country to 20th.
That’s particularly evident in the urban areas, notably South Florida, Jacksonville, and Orlando, where the BRIDG high-tech sensors technology and manufacturing center are growing in Osceola County is taking off, and the Lake Nona area around the conference displays a boom in construction for the Medical City and technology-driven development.
“Some of the best research in the world is going on within a couple of miles of where we’re sitting,'” Wilson said. “In fact, within a couple of hundred yards of where we are right now.”
— Housing starts, construction of new housing, is increasing. Home sales also are up 4.3 percent through November on a year-to-year comparison, far surpassing estimates for the year. Housing inventory also has increased.
“What’s driving the housing market? Jobs,” said Brad O’Connor, chief economist for Florida Realtors.
— Florida consumer sentiment is quite high.
— DeSantis came into office pledging continuations of the business-friendly economic policies of his predecessor, Republican Gov. Rick Scott.
“I can tell you, we’re on offense now because of the way the governor’s race went,” Wilson said of the Florida Chamber. “We could have just as easily been sitting here today talking about being on defense. So I couldn’t be more bullish about the team the governor has brought in.”
There also were some darker notes offered.
— People are worried about a possible recession. Parrish said the Chamber’s polling showed that economic uncertainty now is the top concern, held by 23 percent of Chamber members polled, while workforce talent supply, which had been the top answer the past two years, slipped to second at 18 percent.
— There still is a significant imbalance in economic activity, with parts of Florida still bearing large portions of 3 million people living in poverty.
— There still is what Wilson called a “talent mismatch,” between 277,400 current open jobs and 335,000 people currently looking for jobs, though he expressed strong faith in what the state’s university and college systems are doing to retool programs for local jobs.
— The state’s affordable housing situation is not improving. While home values increased 12 and 8 percent the past two years and is expected to go up 7 percent this year, “Income growth is not keeping up with 7 percent growth,” O’Connor said.
— The growing strength of the American dollar means Europe is now growing cheaper relative to Florida as a vacation destination.
— Wilson raised concerns about Florida continuing to be one of the hottest states for lawsuits, behind only California
— Patronis raised concerns about the ramifications to individual homeowners and businesses and to the state’s insurance business as a result of scams being played through assignments of benefits contracts being pushed on Hurricane Michael victims.
Lawsuits related to assignments of benefits has grown from hundreds in a year to 30,000 currently, Patronis said. This could lead to nervous private-sector insurers and a renewed reliance on the state-administered Citizens Property Insurance. That could lead to more risk for Florida’s government, and that could affect the state’s financial ratings.
“As insurance carriers here in the state of Florida start to see the problems of A.O.B. lawsuits growing, they’re going to start saying, ‘I’m not going to write that ZIP code anymore. I’m not going to write that neighborhood anymore.’ So then what happens is people will go to the insurance of last resort. Citizens starts to repopulate.”