zions bank economic overview€¦ · mar. 2000 63.7 apr. 1978 63.0%. civilian labor force...

ZionsBankEconomicOverview

VeteranOwnedBusinessConference

• May11,2018

DowTops26,000– Up48%Since2016Election

Source:WallStreetJournal

Jan26,201826,616

Oct30,201617,888

DowAroundCorrectionTerritoryDownMorethanTenPercent

Jan26,201826,616

VolatilityReturnstotheStockMarket

19,00020,00021,00022,00023,00024,00025,00026,00027,000

Jan-2017

Feb-2017

Mar-2017

May-2017

Jun-2017

Jul-2017

Aug-2017

Sep-2017

Oct-2017

Nov-2017

Dec-2017

Jan-2018

Feb-2018

Mar-2018

May-2018

DowJonesIndustrialAverage

BusinessOptimismBooming

Source:TradingEconomics,NFIBSmallBusinessOptimismIndex

ConsumerConfidenceRemainsHigh

5060708090100110120130140

Oct-12

Jan-13

3 Jul-13

Oct-13

Jan-14

4 Jul-14

Oct-14

Jan-15

5 Jul-15

Oct-15

Jan-16

6 Jul-16

Oct-16

Jan-17

7 Jul-17

Oct-17

Jan-18

Above110indicateseconomicprosperity

Source:TheConferenceBoard

April2018128.7

OptimismBooming

Source:TradingEconomics,NFIBSmallBusinessOptimismIndex

Trumponomics•RepealandreplacetheAffordableCareAct• TaxReform• Increasespendingoninfrastructureandmilitary•Reducegovernmentregulations•Renegotiatetradedeals

•Butcantheygetitdone…?

USTaxReformOverview• Individual(Sunsetin2025)

• Smallchangestotaxrates• Increasestandarddeduction• Eliminatepersonalexemption• Doublechildtaxcredit• Lowermortgageinterestdeductionfrom$1mto$750k

• Capdeductionsforstateandlocaltaxesat$10,000

• Eliminatevariousitemizeddeductions• Removethehealthinsurancemandate(permanent)

• Corporate(Permanent)• Reducecorporatetaxratefrom35%to21%

• Pass-throughincomedeductionof20%• Repatriationofforeignincomeat15.5%(territorialtaxsystem)

• EconomicImpact• Scoreofaround$1.5trillion• ManyUScompaniesalreadyincreasingwagesandbonuses

• IncreaseGDPbyupto0.5%• Fedreaction?

EconomicGrowthSlowedattheStartof2018butRemainsStrong

PersonalConsumption FixedInvestment NetExports

Inventories Government RealGDPGrowth

Source:BureauofEconomicAnalysis

Q120182.3%

AprilJobIndicators

Indicator Expectation ActualTotalNonfarmPayrolls 191,000 164,000UnemploymentRate 4.0% 3.9%PrivatePayrolls 190,000 168,000MonthlyAverageHourlyWageGrowth 0.2% 0.1%

YearlyAverageHourlyWageGrowth 2.7% 2.6%

LaborForceParticipation 62.9% 62.8%

Sources:WallstreetJournalandBureauofLaborStatistics

AprilMarks91StraightMonthsofJobGrowth

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Source:BureauofLaborStatistics

ButEmploymentGrowthRatesTrendingDown

NationalEmploymentChangePercentChangeinNationalEmploymentbyIndustry:April2017toApril2018

0.0% 1.7% 1.7% 1.9%

2.5% 1.5%

-0.9% 1.1%

2.0% 3.7%

-2% 0% 2% 4% 6% 8% 10%

GovernmentOtherServices

Leisure&HospitalityEd.&HealthServ.Prof.&Bus.Serv.FinancialActivity

InformationTrade,Trans.,Utilities

ManufacturingConstruction

Ntl.Res.&Mining

Total:1.6%

NationalEmploymentChangeTotalChangeinNumberofJobsbyIndustryinThousands:April2017toApril2018

431518

126-26

289245257

-100 0 100 200 300 400 500 600

Ntl.Res.&Mining

UnemploymentRateatLowest-LevelSinceDecember2000

11.0% 1995

5.0%=FullEmployment

April20183.9%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

LaborForceParticipationFellSlightlyinApril

April201862.8%

LaborForceParticipationAmongLowestLevelinAlmost40Years

April.201862.8

Mar.200063.7

Apr.197863.0%

CivilianLaborForceParticipationRate

Men Women

MenApril.201869.2%

WomenApril.201856.7%

BabyBoomersHeadforRetirement

20% 22% 24% 26% 28% 30% 32% 34% 36% 38%

60% 61% 62% 63% 64% 65% 66% 67% 68%

U.S.ParticipationRate Age55+ShareofWorkingAgePop

U.S.ParticipationRate

Shareof55+

Long-TermDeclineoftheTeenageWorkforce

30% 35% 40% 45% 50% 55% 60% 65% 70%

U.S.LaborForceParticipationRate ParticipationRateAges16-19

StandardofLivingBestEver

OneUnemployedWorkerPerJobOpening

Unemployed/Openings

March20181.0

AnnualWageGrowthDeclinedinApril

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

2007– 2017Average2.4%

April20182.6%

WageGrowthLaggingJobGrowth

ProducerPriceIndex

5%2011

Year-to-YearChange

Mar.20183.0%

InflationisStartingtoConvergeontheFed’s2%Goal

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017PCE Core PCE (Excludes Food and Energy)

Source:BureauofEconomicAnalysis

Mar.2018PCE2.0%

Mar.2018CorePCE1.8%

Source:U.S.FederalReserve

FederalFundsTargetRateSees6thIncreaseinOveraDecade

FederalFundsTargetRate=1.50-1.75%

March2018FedRateIncreaseProjections

Source:BoardofGovernorsoftheFederalReserve

2.7% 3.1%

2.9% 3.4%

2018 2019 2020 LongerRun

Dec-17 Mar-18

FedRateIncreaseProjections

IsaRecessionontheWay?

OilPricesRising

… WhichisCausingGasPricestoRise

Source:FederalReserveBankofSt.Louis

EconomicProtectionismIncreasesCosts

EconomicImpactofTradeWars- Cattle

EconomicImpactofTradeWars- Hogs

EconomicImpactofTradeWars- Cars

TradeWarsHurtGrowth

UtahEconomic Conditions

PercentChange:2016to2017U.S.Rate=0.7%

0.2%to0.6%

0.0%to0.1%

NM0.1%

UT1.9%

AZ1.6%

CA0.6%

NV2.0%

OR1.4%

TX1.4%

OK0.2%

CO1.4%

WA1.7%

ID2.2%

MT1.1%

WY-1.0%

ND0.0%

SD0.9%

MN0.9%

NE0.7%

KS0.3%

IA0.5%

MO0.4%

AR0.5%

LA0.0%

WI0.4%

IL-0.3%

IN0.5%

OH0.3%

FL1.6%

TN1.0%

KY0.4%

MS0.0%

AL0.3%

GA1.1%

SC1.3%

NC1.1%

VA0.7%

WV-0.7%

PA0.1%

NY0.1%

ME0.4%

AK-0.2%

HI-0.1%

MA0.5%

VT0.0%

NH0.6%

RI0.2%

CT0.0%

NJ0.4%

DE1.0%

MD0.5%

MI0.3%

DC1.4%

KS0.2%

UtahPopulation3rd Fastest GrowinginU.S.

Source:U.S.CensusBureau

0.7%to1.4%

PercentChange:2016to2017U.S.Rate=0.7%

0.2%to0.6%

0.0%to0.1%

UtahCounties’GrowthOutpacingNation

0.7%to1.4%

-20,000-10,000010,00020,00030,00040,00050,00060,00070,00080,00090,000

0300,000600,000900,000

1,200,0001,500,0001,800,0002,100,0002,400,0002,700,0003,000,0003,300,0003,600,000

NetMigration NaturalIncrease TotalPopulation

34,886

3,101,833

22,587

Sources:U.S.CensusBureau

TotalPop

ulation

ComponentsofPopulationChange

e=estimate,f=forecast

UtahPopulationandComponentsofChange

UtahPopulationGrowthRatesByCounty

2016to2017StateAverage=1.9%

1.0%to1.7%

0.0%to0.9%

1.8%to2.9%

PercentChangeinEmploymentforStates:Mar.2017toMar.2018U.S.Rate=1.5%UTRate=3.3%

1.0%to1.5%

0.0%to0.9%

1.6%to1.9%

UtahisTiedfortheFastestEmploymentGrowth

1,5001996

sofEmployees

TotalNonfarmEmploymentSource:U.S.BureauofLaborStatisticsNote:Numbersroundedtonearestthousand

UtahTotalEmploymentatNewHighsGainof333,100jobsfromlowin

Lossof92,000jobsfrom2007-2010

1.6% -0.5%

5.0% 3.5% 3.5%

2.5% 2.6%

4.2% 3.2%

5.0% -1.2%

-13% -8% -3% 2% 7%

Ntl.Res.&Mining

PercentChangeinUtahEmploymentbyIndustry:March2017toMarch2018

Total:3.3%

UtahIndustriesSeeingGrowth

Source:UtahDepartmentofWorkforceServices

-200 7,2007,0007,000

2,1001,000

11,4004,1004,600

-3,000 -1,000 1,000 3,000 5,000 7,000 9,000 11,000 13,000

Ntl.Res.&Mining

Total:48,000

UtahIndustriesSeeingGrowthTotalChangeinUtahEmploymentbyIndustry:March2017toMarch2018

UtahEmploymentChangeRatesByCounty

March2017toMarch2018StateRate=3.3%

1.0%to3.2%

0.0%to0.9%

3.3%to4.9%

VT3.4%

NH4.4%

MA3.8%

RI3.5%CT

3.9%NJ2.7%

MD2.6%

DC5.7%

UtahHasthe11th LowestUnemploymentRateMarch2018U.S.Rate=4.1%;UT=3.1%

5.5%to5.9%

4.8%to5.4%

4.0%to4.7%

3.9%orless

UtahUnemployment

RatesByCountyFebruary2018

StateRate=3.1%

4.0%to5.9%

6.0%to6.9%

3.1%orlower

3.2%to3.9%

DE2.5%

VT3.4%

NH4.4%

MA3.8%

RI3.5%CT

3.9%NJ2.7%

MD2.6%

DC5.7%

UtahPersonalIncomeGrowth3rd HighestintheNationPercentChangeinPersonalIncome:2016- 2017

U.S.=3.1%,UT=4.4%ID= 4.7%

3.6%to3.9%2.0%to3.5%

4.0%ormore

0.0%to1.9%Decrease

2016U.S.Rate=14.0%,UtahRate=10.1%

Source:U.S.CensusBureau,AnnualCommunitySurvey1-yearestimate

NM19.8%

UT10.1%

AZ16.3%

CA14.3%

NV13.8%

OR13.3%

TX15.6%

OK16.3%

CO11.0%

WA11.3%

ID14.4%

MT13.3%

WY11.3%

ND10.6%

SD13.3%

MN9.9%

NE11.4%

KS12.1%

IA11.8%

MO14.0%

AR17.1%

LA20.1%

WI11.8%

IL13.0%

IN14.1%

OH14.6%

FL14.6%

TN 15.8%

KY18.5%

MS20.8%

AL17.1%

GA16.0%

SC15.3%

NC 15.4%

VA11.0%

WV17.8%

PA12.9%

NY14.6%

ME12.5%

AK9.9%

HI9.3%

MA10.4%

VT11.9%

NH7.2%

RI12.8%

CT9.8%

NJ10.4%

DE11.6%

MD9.6%

MI15.0%

DC18.6%

15.1% to 18.0%12.1% to 15.0%

10.0% or less

10.1% to 12.0%

18.1% +

UtahPovertyRate7th LowestintheNation

UtahConsumerConfidenceHitsNewHigh

5060708090100110120130140

Jul-12

Nov-12

Mar-13

Jul-13

Nov-13

Mar-14

Jul-14

Nov-14

Mar-15

Jul-15

Nov-15

Mar-16

Jul-16

Nov-16

Mar-17

Jul-17

Nov-17

Mar-18

U.S.ConsumerConfidenceIndex:127.7

ZionsBankUtahConsumerAttitudeIndex:129.5

Above110indicateseconomicprosperity

Sources:ConferenceBoardandCiceroGroup

UtahInflationHigherThanUS

-1.0% -0.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5%

Sep-2011

Dec-2011

Mar-2012

Jun-2012

Sep-2012

Dec-2012

Mar-2013

Jun-2013

Sep-2013

Dec-2013

Mar-2014

Jun-2014

Sep-2014

c-2014

Mar-2015

Jun-2015

Sep-2015

c-2015

Mar-2016

Jun-2016

Sep-2016

c-2016

Mar-2017

Jun-2017

Sep-2017

c-2017

Mar-2018

UnitedStatesCPI:+2.4% ZionsBankWasatchFrontCPI:+2.6%

Source:U.S.CPIfromNationalBureauofLaborStatisticsandWasatchFrontCPIfromCiceroGroup

Utahhomevaluescontinuetorise

$95,000$115,000$135,000$155,000$175,000$195,000$215,000$235,000$255,000$275,000

UnitedStates Utah

UtahDec.2017$262,200

U.S.Dec.2017$206,300

Source:ZillowResearch

UtahResidentialConstructionActivityContinuestoRise

10,000

15,000

20,000

25,000

30,000

Single-FamilyUnits Multifamily Total

Forecast

Source:Ivory-BoyerConstructionDatabase,Kem C.GardnerPolicyInstitute

HouseholdCreationSurpassesHousingUnits

Source:Kem C.GardnerPolicyInstitutePopulationProjectionsandIvoryBoyerConstructionDatabase

UtahValueofNewResidentialConstructionIncreasing

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

Residential Nonresidential Renovations Total

Forecast

MillionsofD

ollars

Source:Ivory-BoyerConstructionDatabase,Kem C.GardnerPolicyInstitute

Sources:StateofUtahRevenueAssumptionsWorkingGroup,Moody’sEconomy.com,IHSGlobalInsights e=estimatef=forecast

0 1 2 3 4 5 6 7 8 9

RetailSales

HomePrices

PersonalIncome

UnemploymentRate

NonfarmEmployment

Population

2016 2017e 2018f 2019f

UtahEconomicIndicators2016-2019f

RobertSpendloveEconomicandPublicPolicyOfficer

Email:Robert.Spendlove@zionsbank.comPhone:801-560-5394

ZionsBank,ADivisionofZB,N.A.MemberFDIC.

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zions bank economic overview€¦ · mar. 2000 63.7 apr. 1978 63.0%. civilian labor force...

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