Oregon Employment Forecast: Hanging Out in the Sweet SpotMay 2, 2018 Oregon has moved beyond the peak employment growth rates of 2014 and 2015 and settled into a slower, more sustainable pace that’s more than enough to absorb new workers entering the labor force. Additionally, wages and household incomes are rising and the labor force participation rate is rebounding while the unemployment rate remains near record lows and inflation soft. In short, Oregon has hit the economic sweet spot according to the Office of Economic Analysis (OEA).
The outlook remains bright. In their latest forecast, OEA expects Oregon will add roughly 3,000 jobs a month through 2018 for a growth rate of about 2 percent; enough to hold down the jobless rate and account for population growth. This pace continues through 2019 (40,000 jobs; 2.1%) before slowing to 1.1 percent (21,000 jobs) in 2020.
The professional and business services sector will lead growth in 2018. This large and diverse industry includes company headquarters, temp help firms, engineering, and computer systems design. Construction slows sharply from 2017, but will nonetheless grow second-fastest as the housing recovery continues and in-migration remains high.
IHS Economics, a contributor to the OEA's forecast, shares OEA’s optimistic outlook for Oregon. They expect the state's Real Gross State Product to grow faster than all but four states, with gains averaging 2.7 percent through 2023. Job growth will be the ninth-fastest, with the manufacturing sector expanding more rapidly than all but one state. Total personal income growth is expected to be 4.9 percent per year, the fifteenth fastest among all states.
Oregon’s favorable job growth forecast depends on maintaining three major competitive advantages that have served us well in the past: our ability to attract and retain a skilled labor force; our industry structure; and a favorable climate for new business formation.
The OEA's complete report is available at www.oregon.gov/das/OEA/Pages/forecastecorev.aspx.