Richmond forecast 2018.

• Author: Zhong, Litao
• Position: Statistical data

There are many indications that economic activity picked up steam in the Richmond region (1) throughout 2017. Total personal income and per capita personal income have been climbing since 2009. Although the labor force in our region dropped slightly, unemployment has reached a historic low. Weekly wages have finally experienced significant growth, and the housing market has also improved. The IU East Business Confidence Index also increased, indicating that businesses are optimistic for 2018 in our region.

Income

The total dollar volume of economic activity in the region and the local standard of living can be measured by total personal income and per capita personal income. Since 2009, these two indicators have been on a six-year growth spree for Wayne County and the Richmond region (see Figures 1 and 2).

According to the most recent data from the U.S. Bureau of Economic Analysis, total personal income for Wayne County was $2.4 billion in 2015, having grown 2.1 percent from 2014, and ranked 27th in the state. Wayne County had a per capita personal income (PCPI) of $36,494, having grown 2.7 percent from 2014, and ranked 56th in the state. Although the region's economy grew at a steady rate, per capita personal incomes were still below the state and national averages (see Figure 3).

Labor market

The labor market showed mixed signals in our region. The average size of the labor force slid 2 percent in Wayne County for the first eight months of 2017 and fell 0.8 percent for the region as a whole. Wayne County's labor force included 30,178 people in August 2017, and the region's labor force was 78,378. Although the labor force shrank, unemployment rates reached historically low levels in April 2017: 3 percent in Wayne County and 3.1 percent for the region (see Figures 4 and 5).

Unemployment in our region is following state and national trends (see Figure 6). While the low unemployment rate is clearly cause for optimism, the falling labor force is a cause for concern because it indicates that people are either dropping out of the labor market or relocating to a different area.

Jobs and wages

Table 1 shows changes in employment by industry. As of the first quarter of 2017, 29,807 people were employed in nonfarm sectors in Wayne County and 57,062 in the region. There were 115 job gains in Wayne County but 490 job losses for the region. Manufacturing showed particularly strong growth, outshining other industries. Wayne County added 116 more manufacturing jobs and the region added 268. Other notable job gains appeared in wholesale trade; finance and insurance; and entertainment and recreation. Sectors experiencing major job losses were transportation and warehousing; professional and business services (only for the region); education services, accommodation and food services; other services; and government. The reason the region lost so many jobs in the professional and business services sector might be due to the closure of Marujun in Randolph County in 2016, which had a significant impact.

The increase in weekly wages is compelling. After a long period of anemic wage growth, weekly wages finally saw a sizeable increase in our region. In the first quarter of 2017, average weekly wages for total nonfarm employment grew by 8.9 percent to $735 in Wayne County over the previous year, and by 7.4...