2006 'looks good' to economist

By PAT JENKINS

The Mirror

Cross your fingers for another solid economic year in 2006, a regional economist told a Federal Way audience last Thursday.

Based on 2005 and some other recent years, unemployment is low, jobs are more plentiful and Washington’s economy overall is improving, said Kris Sjoblom, a vice president of Washington Research Council, a Seattle-based group that analyzes issues affecting business, government and the general public.

Optimism should be guarded, though, in case the economy slips into reverse, he advised.

“Things look good. But they usually do look good in the first six months of a recession,” Sjoblom said during a speech at the Federal Way Chamber of Commerce’s annual Economic Forecast Breakfast.

He said a source of continuing concern is the federal budget deficit of $314 billion for fiscal year 2005.

On the other hand, he said, the United States’ gross domestic product is expected to grow 5.6 percent, the affect of oil prices on inflation “should pass,” and the national unemployment rate of 4.9 percent is below the average of 5.4 percent in the approximately 60 years since World War II. He added Washington’s unemployment rate is usually slightly better than the national level.

Sjoblom said job growth has improved since the end of the l990s.

He downplayed the “bubble” of the housing market, saying prices of homes tend to boom at the end of each decade and then flatten until the next boom.

From a consumer standpoint, savings have plummeted –– even hit negative numbers –– but aren’t necessarily a bad symptom economically because many people have a year’s worth of personal income as assets, according to Sjoblom.

Another speaker during the chamber event at The Commons at Federal Way –– John Wolfe, deputy executive director of the Port of Tacoma –– said the port helps generate jobs regionally and statewide with its shipping activity. Its success is tied to transportation, he added, and improvements of highways and rail lines are needed to keep port traffic humming.

Editor Pat Jenkins: 925-5565, editor@fedwaymirror.com

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