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

Apr-2

017

May-2017

Jun-2017

Jul-2017

Aug-2017

Sep-2017

Oct-2017

Nov-2017

Dec-2017

Jan-2018

Feb-2018

Mar-2018

Apr-2

018

May-2018

DowJonesIndustrialAverage

BusinessOptimismBooming

Source:TradingEconomics,NFIBSmallBusinessOptimismIndex

ConsumerConfidenceRemainsHigh

5060708090100110120130140

Oct-12

Jan-13

Apr-1

3 Jul-13

Oct-13

Jan-14

Apr-1

4 Jul-14

Oct-14

Jan-15

Apr-1

5 Jul-15

Oct-15

Jan-16

Apr-1

6 Jul-16

Oct-16

Jan-17

Apr-1

7 Jul-17

Oct-17

Jan-18

Apr-1

8

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

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

2012

2012

2012

2012

2013

2013

2013

2013

2014

2014

2014

2014

2015

2015

2015

2015

2016

2016

2016

2016

2017

2017

2017

2017

PersonalConsumption FixedInvestment NetExports

Inventories Government RealGDPGrowth

Source:BureauofEconomicAnalysis

Q120182.3%

2018

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

-900

-700

-500

-300

-100

100

300

500

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%

8.8%

-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

399

279

431518

126-26

289245257

59

-100 0 100 200 300 400 500 600





Ntl.Res.&Mining


UnemploymentRateatLowest-LevelSinceDecember2000

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

11.0% 1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

5.0%=FullEmployment


April20183.9%

62%

63%

64%

65%

66%

67%

68%

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

LaborForceParticipationFellSlightlyinApril

April201862.8%


56%

58%

60%

62%

64%

66%

68%

1956

1958

1960

1962

1964

1966

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

LaborForceParticipationAmongLowestLevelinAlmost40Years


April.201862.8

Mar.200063.7

Apr.197863.0%

CivilianLaborForceParticipationRate

30%

40%

50%

60%

70%

80%

90%

1948

1951

1954

1957

1960

1963

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

2011

2014

2017

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%

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

U.S.ParticipationRate Age55+ShareofWorkingAgePop

U.S.ParticipationRate

Shareof55+


Long-TermDeclineoftheTeenageWorkforce

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

1975

1977

1979

1981

1983

1985

1987

1989

1991

1993

1995

1997

1999

2001

2003

2005

2007

2009

2011

2013

2015

2017

U.S.LaborForceParticipationRate ParticipationRateAges16-19


StandardofLivingBestEver

OneUnemployedWorkerPerJobOpening

0

1

2

3

4

5

6

7

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Unemployed/Openings

March20181.0


AnnualWageGrowthDeclinedinApril

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

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

2007– 2017Average2.4%

April20182.6%


WageGrowthLaggingJobGrowth


ProducerPriceIndex

-2%

-1%

0%

1%

2%

3%

4%

5%2011

2012

2013

2014

2015

2016

2017

Year-to-YearChange


Mar.20183.0%

InflationisStartingtoConvergeontheFed’s2%Goal

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

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%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Source:U.S.FederalReserve

FederalFundsTargetRateSees6thIncreaseinOveraDecade

FederalFundsTargetRate=1.50-1.75%

March2018FedRateIncreaseProjections

Source:BoardofGovernorsoftheFederalReserve

2.1%

2.7% 3.1%

2.8%

2.1%

2.9% 3.4%

2.9%

0%

1%

2%

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%

Loss

0.2%to0.6%

1.5%+

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%

Loss

0.2%to0.6%

1.5%+

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

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

NetMigration NaturalIncrease TotalPopulation

34,886

3,101,833

22,587

2017

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%

Loss

3.0%+

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


1.0%to1.5%

0.0%to0.9%

Loss

1.6%to1.9%

2.0%+

UtahisTiedfortheFastestEmploymentGrowth

800

900

1,000

1,100

1,200

1,300

1,400

1,5001996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Thou

sand

sofEmployees

TotalNonfarmEmploymentSource:U.S.BureauofLaborStatisticsNote:Numbersroundedtonearestthousand

UtahTotalEmploymentatNewHighsGainof333,100jobsfromlowin

2010

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

3,900

-200 7,2007,0007,000

2,1001,000

11,4004,1004,600

-100

-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%

5.0%+

3.3%to4.9%

Loss


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%

6.0%+

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%

7.0%+

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

De

c-2014

Mar-2015

Jun-2015

Sep-2015

De

c-2015

Mar-2016

Jun-2016

Sep-2016

De

c-2016

Mar-2017

Jun-2017

Sep-2017

De

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

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

UnitedStates Utah

UtahDec.2017$262,200

U.S.Dec.2017$206,300

Source:ZillowResearch

UtahResidentialConstructionActivityContinuestoRise

0

5,000

10,000

15,000

20,000

25,000

30,000

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

Single-FamilyUnits Multifamily Total

Forecast

Source:Ivory-BoyerConstructionDatabase,Kem C.GardnerPolicyInstitute

HouseholdCreationSurpassesHousingUnits

Source:Kem C.GardnerPolicyInstitutePopulationProjectionsandIvoryBoyerConstructionDatabase

UtahValueofNewResidentialConstructionIncreasing

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

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:[email protected]: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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