Ohio: the comeback state? More evidence points to 2004 economic rebound in Ohio, but challenges remain.

• Author: Eufinger, Tony

Fueled by a rise in the Gross Domestic Product (GDP), a stock market recovery, stronger employment figures and an encouraging holiday spending spree, economists and other prognosticators are betting on a brighter economic outlook for 2004. A virtual avalanche of studies, reports and forecasts all pointing to a rebound concur with The Ohio Society's own State of Ohio Business Poll findings, which predicted a rebound in Ohio's economy this year. But is it too early to start celebrating in Ohio? Are we the comeback state? Here several key observations from different regions across Ohio on the state's economic prospects for 2004.

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There's an old saying in presidential politics that is bound to re-emerge this year: "As Ohio goes, so goes the nation."

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Whether talking about Ohio or the nation as a whole, forecasters generally agree that the 2004 economy is almost certain to outpace the dreary economic climate of 2003. Perhaps even better news for many Ohioans is that the economists and business experts predict good news with respect to job growth and capital investment in the Buckeye State. Their expectations match or exceed the positive outlook offered by many of Ohio's CPA business leaders about the 2004 Ohio economy.

Here's a quick re-cap of The Ohio Society's forecast:

* Sixty-four percent of Ohio CPAs surveyed for the State of Ohio Business Poll in early November predicted that Ohio's economy will improve in 2004.

* More than half of the CPAs (51 percent) expected increased capital investments in Ohio, while 41 percent anticipated capital investment would remain consistent with 2003 levels.

* Forty-two percent foresaw expansion in Ohio's job market.

* Forty-four percent predicted there will be little change, but only 13 percent expect fewer jobs available to Ohioans this year.

Respondents also identified the health care sector as the number one growth industry for 2004, followed by construction--both commercial and residential, technology and service industries as other potential growth areas. They predicted the manufacturing sector would see the least improvement.

Banking on Ohio's Success

So how do these expectations compare to those held by other key observers? Richard DeKaser, chief economist for National City Bank in Cleveland, agrees the outlook for Ohio's 2004 economy is positive.

"Those numbers make perfect sense and are consistent with other indicators I'm observing. Nationally, GDP is growing above its traditional rate, and this is the single most important factor for the Ohio economy."

DeKaser points out that Ohio stands to benefit from a greater demand in manufactured goods as businesses rush to restock their inventories. He also sees an increase in capital investments on the horizon.

If anything, DeKaser, whose employer is one of...