Northeast Mississippi Economic Forecast Conference talks about recovery mode

By Dennis Seid/NEMS Daily Journal

TUPELO – Unemployment will remain high across the country and statewide, which will slow down economic recovery, said a trio of speakers at Wednesday’s annual Northeast Mississippi Economic Forecast Conference.
“I don’t think we’ll have a ‘W,’ a double-dip where we slide back into recession,” said Loren C. Scott, an economist whose consulting company has worked with the likes of ExxonMobil, Entergy, Capital One Financial and J.P. Morgan Chase.
“But with the unemployment figures, we’ll be seeing some slow growth. After the last two recessions, employment always lagged.”
Phil Hardwick, coordinator of capacity development at Mississippi State University’s John C. Stennis Institute of Government, said Mississippi faces a difficult 18 months with a strapped budget that likely will not get any better.
Unemployment, which for the state was 9 percent in November, will remain high, Hardwick said.
But Scott and Hardwick said the jobless figures will ease as the U.S. Census Bureau hires thousands of temporary workers for this year’s count.
In Mississippi’s case, employment overall has been centered in about 10 clusters across the state, Hardwick said.
“There are 10 counties in Mississippi that account for 50 percent of the jobs,” he said.
Lee County is one of those clusters of employment, and the outlook is good, said Chris Rogers, chairman of the Community Development Foundation.
“We are working on 16 active economic development projects representing some $50 million of capital investment and 537 jobs and just under a million square feet of manufacturing space,” he said. “That is my reason for optimism.”
Rogers also noted that from 2001 to 2009, existing companies in Lee County created more than 4,800 new jobs and $294 million in capital development. New manufacturing spawned more than 3,900 jobs and $755 million in new capital investment.
“While still on hold for the promised jobs with Toyota,” he said, “we grew more than the rest of the nation in manufacturing jobs.”
Alluding to Toyota, Rogers added that he was confident that the automaker would eventually open its idled Blue Springs plant.
“In my book, you can bank it – this plant and its 2,000 jobs will open and the supplier companies and their additional 2,000 jobs are like an annuity, ready to pay off in the future,” he said. “It will happen at the appropriate time.”
Indeed, Toyota officials said last week that the plant would open when the U.S. economic recovery hit “full stride.”
But when that recovery occurs is uncertain, said Scott. Leading indicators are on the rise, a sign that the U.S. economy is on the rebound.
“The recession has been nothing like the Great Depression, when we had 43 months of decline,” he said. “The recession we had was the longest since then, but it lasted only about 18 months.”
Economic forecasts suggest growth around 2.5 percent this year. One forecast from Moody’s suggests growth in 2011 and 2012 as much as 5.7 percent nationally, but Scott said it’s “absolutely silly” to believe that will happen.
Scott made it quite clear that he favors free enterprise and a market-based economy, blasting what he calls “job killing” policies coming out of Washington.
He said the Obama administration and Congress were hurting the economy with higher taxes, pro-union stances, anti-free trade legislation, extreme pro-green policies, more regulation and their health care proposals.
Still, Scott said the financial bailout last year was probably a good idea. The stimulus package, however, was designed “to get people elected, not put people to work.”
Despite the budget woes facing Mississippi, Hardwick said the state was positioned for growth once it gets through the next 18 months.
“One of our competitive advantages is we try to make it easier for companies to do business here,” he said.
In fact, the American Legislative Exchange Council ranked Mississippi 19th among the states best positioned for economic recovery.
“Government spending, especially aerospace and defense will grow in Mississippi,” Hardwick said. “Also, energy can become a big opportunity. We are a huge energy-producing state.”

Contact Dennis Seid at (662) 678-1578 or dennis.seid@djournal.com.