Connaughton: Economy rising with housing
John Connaughton, an economist at the University of North Carolina at Charlotte, released his quarterly forecast for North Carolina earlier this week.
He forecasted continued growth in 2014, due to an increase in consumer confidence and rising housing prices. He also noted a decreased unemployment rate in the state, despite sluggish job growth in December and January.
According to a statement, Connaughton anticipates the unemployment rate will continue to fal during the year, reaching 6 percent by December. He anticipates the state will add 60,200 net jobs in 2014, a 1.5 percent increase.
He predicted that 15 of the state’s economic areas will experience increases during the year. However, he anticipated the areas with the strongest expected growth will be agriculture, construction, “other services,” government, wholesale trade, transportation, Warehousing and Utilities; and finance, insurance and real estate.
He anticipated a projected real increase of 11.9 percent in the gross state product of the agriculture sector. Gross state product measures the total output of a state’s economy in the given year, similar to the national gross domestic product.
The statewide real gross state product will increase by 3 percent more than the 2013 level, according to his forecast.
Connaughton said there were several factors that led him to forecast a growth year for the state. He said that for the first time in years, the U.S. Congress has passed a budget, which effectively puts a closure on sequestration and allows for government agencies to cut spending without employee furloughs. He also pointed to an increase in consumer confidence.
According to a statement, the consumer confidence index from February stood at 78.1, which indicated six months of good performance.
He also pointed to a sustained increase in housing prices and a smaller projected budget deficit.
“All of those factors point to a healthy recovery year for the north Carolina economy in 2014,” Connaughton said in a statement.
Connaughton is a Babson Capital professor of financial economics and director of the economic forecast. They have provided economic data for the state since 1981 in a quarterly luncheon and presentation.