Economist: Boise positioned well in slower-growth U.S.

Next year’s economic conditions should be better in southwest Idaho than in the U.S. overall, a Northwest economist said.
Bill Conerly of Conerly Consulting LLC, Lake Oswego, Ore., keynoted the Boise Metro Chamber of Commerce Economic Outlook Forum Nov. 13 at Boise Centre on the Grove.
He said many of his colleagues forecast roughly 2 percent growth in the U.S. economy over the next couple of quarters. He’s more optimistic: He said he expects growth at just below the 3 percent considered sustainable long-term.
Recession – two straight quarters of contraction or non-growth – has a one-in-four chance of materializing next year, he said. Consumers continue to spend, but future levels of consumer and business spending remain a concern, he said.
Another concern is whether the credit crunch sparked by subprime mortgage problems “passes from Wall Street to Main Street,” said Conerly.
The Federal Reserve Board is about done cutting short-term interest rates, and long-term rates figure to rise as fewer foreign investors buy U.S. Treasury bonds and notes, Conerly said.
“The national housing market is in very sad shape,” he said. “It’s going to take a couple of years to work off excess supply; ’08 will not be the year of turnaround.”
“The Boise area will work off the excess [housing] inventory much faster,” Conerly said. Home construction in the Boise area tapered off starting in 2005, and homebuilders under-built benchmarks last year, he said.
Job growth continues in the Boise metro area, though it is not as strong as it has been, Conerly said. In-migration figures to help the housing market, as well as the labor market from a worker-availability standpoint, he added.
Conerly, and local presenter Steven Guadagno of Adecco Technical, said companies must emphasize employee retention in the still-tight labor market.
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