Wells Fargo senior economist Mark Vitner is optimistic about the future of the local economy.
HOLLY SPRINGS – The economy should show a great deal of recovery in 2013; unless, of course, it doesn’t.
In other words, there is still plenty of uncertainty when it comes to the nation’s economic future.
Wells Fargo senior economist Mark Vitner delivered that mixed message recently at an economic forum sponsored by the Apex, Holly Springs and Fuquay-Varina chambers of commerce at the Holly Springs Cultural Center.
While the next 12 months should reveal some signs of recovery, the process will remain long, complicated and arduous.
The debt crisis in Europe, the political gamesmanship surrounding the fiscal cliff and the unwillingness of individuals and businesses to commit to major capital purchases make accurate prognostications difficult.
“We are more than three years into recovery and there is still a considerable amount of uncertainty,” said Vitner. “The fiscal cliff is only the beginning. There is a lot of work ahead of us in terms of getting things in order.”
Complicating matters even more is that some positive signs actually have negative undertones. The recent decline in the unemployment rate is a perfect example.
“New jobs have been in low paying fields without benefits,” said Vitner. “We are still on the slow track for job growth. It has to do with how businesses view the future. They are less willing to commit to major capital investments or to hire more employees. They are concerned about Obamacare and how it will affect them.”
The statistics also will show a large increase in new house construction in 2013. But that isn’t too surprising considering how low the construction rate fell in the past three years.
“Homebuilders are feeling better but they were feeling pretty lousy,” said Vitner. “So, even if they are feeling better it’s still not the same as feeling good.”
The European fiscal crisis continues to cause issues for the global economy. Problems with the Euro are forcing more people and businesses to leave for other countries.
“The best and brightest are all leaving,” said Vitner. “That is not a good strategy. It will probably take another decade for Europe to get back on its feet.”
But problems in Europe have become opportunities in Charlotte and Raleigh as businesses continue to relocate to North Carolina.
“Companies here think the economy is in a mess,” said Vitner. “European companies are saying, ‘You don’t know what a mess is.’”
While the Triangle felt many negative effects from the struggling economy, the area fared much better than most other communities nationwide.
Jobs and economic growth most likely will increase in 2013 at a rate unattainable in most other areas.
“The Triangle will add 20,000 jobs with education and health services leading the way” said Vitner. “Unemployment will come down but it’s still way too high and construction is still slow.”
Yet, the old adage that the Triangle is one of the last areas to feel the affects of a recession and among the first to show signs of recovery seems to be holding true.
It’s news that has some local chamber of commerce officials feeling pretty good about the future.
“We need to realize that we are blessed in North Carolina,” said Holly Springs Chamber of Commerce Executive Director Scoop Green. “Things are good for us here in the Triangle but they can be better. We still have a lot of work ahead of us.”
“We are very fortunate in North Carolina, especially in the Triangle,” said Apex Chamber of Commerce Executive Director Graham Wilson. “We still have a long way to go but I think overall the news is very encouraging.”
Fuquay-Varina Chamber of Commerce Executive Director Tommy Broadwell remains a bit more cautious.
“We’ve known for a long time that we are blessed in this area,” said Broadwell. “But there is still a lot of uncertainty about the future. It concerns me that we may not be out of this recession when the next recession starts.
“The problem is you have so much uncertainty that people are waiting before doing anything. All that waiting is creating more problems for the economy. So, I don’t think the news is too promising right now.”
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