The next official forecast – the one that will determine the exact amount of money available for the 2011-13 budget – is due March 17.
But until then, economic tea leaves are contained in the month economic and revenue update done by state economist Arun Raha. It not only updates his projections for the state and national economies, it reports the actual tax collections from the previous month and says whether they are higher or lower than normal.
Today’s update teases with news that tax collections are slightly more healthy than expected _ by $36.9 million. But then Raha and his staff add this buzzkill: “… but most of the positive variance is estimated to have been due to a change in the payment pattern of Revenue Act taxes. When the change is taken into account, cumulative revenue collections are close to our November forecast.”
In the spirit of Gov. Chris Gregoire‘s pep talk today during her state of the state speech, we should at least look at this as good news. Collections that are at least on track as opposed to down doesn’t make the hole deeper.
Here’s a pdf of the report.
Raha continues to forecast a tepid recovery which has expanded since his November forecast but not by much.
“Washington’s economy has continued to expand since the November forecast but we are still not seeing strong job growth,” the report states. “Housing construction is showing some signs of life but nonresidential construction is lagging. The outlook for software and aerospace is good and we should see a gradual upturn in growth this year.”
And while he saw some signs of hope in consumer spending over Christmas, he said he cannot tell whether it is a permanent change of habit.
“Although the economy is improving, the after effects of the Great Recession continue to
weigh on the recovery,” the report said of the national economic situation. ” Job growth is slow and housing remains fragile. However, consumers appear to have given expression to pent-up demand this holiday season. The question is: will it last?”