ChangMook Sohn, executive director of the State Economic and Revenue Forecast Council, today sent his latest economic forecast – for June – to the Governor’s Council of Economic Advisors. The advisors will meet Friday in Olympia to review the forecast.
Among the highlights:
&bull Nationwide, what little GDP growth there was in the first quarter (1.3 percent) was more than accounted for by consumer spending which rose at a rate of 3.8 percent.
&bull Housing starts continued to plunge in the first quarter, falling at a 19.9 percent rate to 1.474 million units. The mortgage rate declined to 6.22 percent in the first quarter from 6.25 percent in the fourth quarter.
&bull The national forecast shows an even more severe downturn than assumed in the March forecast, but the Washington forecast continues to expect a slowing, but no significant decline. “We believe the underlying trend is close to 50,000 units with higher multi-family activity offsetting much of the decline in the single-family market.”
&bull The Washington aerospace employment forecast is virtually unchanged since March. As of April, the aerospace sector has added 16,600 jobs since the trough in May 2004. The forecast expects another 3,400 new aerospace jobs by mid-2008 when employment is expected to level off at 80,900. This is still 32,200 (28.5 percent) lower than the previous peak in June 1998.
&bull Excluding software jobs, which tend to skew general results, real personal income will increase 0.9 percent in the second quarter and 4.7 percent in 2007 as a whole. The figure will increase 4.6 percent in 2008. The average annual wage for Washington workers will increase 4.4 percent in 2007 and 3.9 percent in 2008.
To see a copy of the full forecast, visit www.erfc.wa.gov.