The State of Wyoming Economic Analysis Division released a fourth quarter 2019 economic summary on Tuesday, March 31, 2020.
The report notes that many economists think that the COVID-19 coronavirus will have wide-ranging economic impacts.
“The fallout from coronavirus pandemic is expected to have a significant negative impact on the U.S. economic prospects,” the report states. “Millions of jobs will be lost and the drop in economic output may surpass a trillion dollars in 2020.”
“A recession is now all but certain, according to leading economists across the country, including Wall Street Journal survey of 34 economists, and the GDP could plunge in the second quarter.”
The extent of the economic downturn is still unclear, according to the report, though it adds that the global economy is facing problems due to the virus.
“According to Moody’s Analytics, COVID-19 has created a worldwide economic tsunami,” the report states. “The global economy was already engulfed in a serious downturn. Just how severe and how long the global pandemic will turn into is still highly uncertain, but it is clear that the more widespread and virulent the virus, the greater a global downturn.”
“In the midst of the global pandemic, businesses worldwide are disrupted, and many schools and daycare centers are closed, making it difficult for parents to work. International travel and trade are impaired, and stock prices decline.”
Banks and governments have been acting to quell impacts to the economy.
“Global central banks and governments are increasingly aggressive in responding to the health and economic crisis by slashing interest rates, engaging in additional quantitative easing, reducing capital requirements
to their banks, appropriating funds to address the crisis, and providing discretionary fiscal stimulus that includes more government spending and tax cuts,” the report states. “The malicious virus is not only a personal health threat, but also a supply and demand shock to the economy.”
The report gives information about other economic indicators for Wyoming’s economy prior to the outbreak reaching the state in fourth quarter 2019.
That includes data about employment.
“After the severe downturn in 2015 and 2016, Wyoming’s economy experienced a year of strong rebound from the fourth quarter of 2018 to the third quarter of 2019,” the report states. “However, the recovery slowed down tremendously in the fourth quarter of 2019.”
Overall employment “barely grew” with Wyoming adding 350 jobs during the economic quarter. The report adds that unemployment say at 3.7%, “slightly higher than the national average.
“The construction industry added the largest number of jobs, mainly due to
activities in utility construction such as oil pipelines and wind power projects,” the report adds. “Manufacturing, wholesale trade, financial activities, and private education & health services experienced moderate growth, about 1.0 percent, respectively.”
“Employment in services where a large number of jobs are located such as retail trade and leisure & hospitality showed larger losses in a year-over-year comparison. The state’s pivotal industry, mining (including oil & gas extraction), lost 300 jobs, or 1.4 percent from the previous year.”
The report also examines data about Wyomingites’ personal income and earnings, which grew 4.2% compared with fourth quarter 2018.
“U.S. personal income increased 4.1 percent during the same period,” reads the report. “Personal income is the income received by all residents from all sources. It is the sum of wage & salary and proprietors’ earnings; property income (dividends, interest, and rent); and personal transfer receipts
such as Social Security Income, Medicare and Medicaid benefits, veterans benefits, and other income benefits and assistance.”
“Total earnings in the state grew 5.4 percent annually in the quarter, while property income and transfer receipts increased 0.4 and 7.5 percent, each. Earnings in most sectors demonstrated expansions from a year ago, led by the farm sector’s growth rate of 129.8 percent. Construction also showed strong growth of 14.8 percent. The mining industry experienced a moderate increase from the previous year.”
Home prices in Wyoming jumped 5.8% compared with fourth quarter 2018, compared with 5.1% increases nationally.
“In Wyoming, single-family building permits for new privately-owned residential construction in the fourth quarter of 2019 were 6.0 percent higher than the previous year level,” the report adds. “Both mortgage delinquency rates and foreclosure rates in December were lower than last year, according to CoreLogic. The U.S. house price appreciation remained the same after decelerating in six consecutive quarters on an annual basis.”
“The decline in mortgage rates, down more than one percentage point for fixed-rate loans from last year, has supported rise in sales activities and home prices. Still, many households are facing affordability challenges because of the sharp run-up in prices over the past several years. The supply-side constraints on the housing market remain tight, and inventory-to-sales ratio for existing homes are still extremely low. However, the sharp downtick in both near-term housing demand and supply will mirror the economic shock inflicted by COVID-19.”