Jeffrey H. Dorfman

Economic Outlook forThe U.S. and Georgia

Slowly Going Back to Work?

Lower Workforce Participation

Change is Not Due to Old People

But Some Have Not Gone Back to Work

Federal Spending and Revenue

US Budget Picture – What Changed?

From 2001 to 2013, all figures adjusted for inflation and population growth.

Spending Revenue05

10152025303540

Percentage Growth Since 2001

Why Can the Government Afford This?

US Budget OutlookRepublicans and Democrats will continue to make

last minute compromises.

Spending is starting to increase again ($65 billion this year).Sequester was working, so it is over.

Democrats will push for more tax revenues, but probably won’t get much if any.

We will continue with deficits that are 2-3 times what used to be the historical record.

Minimum Wage

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

2006

2009

2012

$0.00$1.00$2.00$3.00$4.00$5.00$6.00$7.00$8.00

Recent Trends In Productivity

Source: BLS

More on Productivity and Labor Costs

Source: BLS

Immigration ReformIt looks like something will happen this year

in Congress.

Republicans are proposing citizenship for those brought as kids, legalization for adults.

President Obama will agree.

If the more extreme on both sides do not block it, looks like a deal will be done.Ag better get a seat at the table if they want

to be included.

Debt CeilingDebt limit is reached tomorrow.

Treasury can cook the books for 1-3 months.

Republicans cannot decide what do ask for in exchange Keystone XL Pipeline, border security,

repatriated profits ???

Likely solution is a minor concession to get a deal.

Obamacare Problems Still Developing Website still cannot communicate well with insurance

cos.

Website security still lacking.

Insurance Bailout looms if the sign-ups are too old & sick.

People are starting to discover issues with doctors, co-pays, etc.

This will still be problem for Democrats for at least this year.

Georgia Earnings in Food Service and Hospitality

Producer Price Index - Manufactured Food

Georgia Budget OutlookRevenues for FY14 are +5.1% so far, exceeding

the 4.6% needed for budget.

December was up 3.8%, but trend is confused by change in car tag tax.

AES and CES continue to try to hang on to small gains in budgeted funds, essentially enough to offset some of the increased costs of employee benefits.

University as a whole doing better in budget.

Georgia Economic OutlookGeorgia appears to be finally growing faster than the

US average again (after 5 years of slower growth).

Georgia economy should grow at 3+% in 2014

Personal and disposable income are both growing, so consumer spending should increase in the 3-4% range

Georgia is continuing to outperform right now at landing big new job gains (Engineered Floors, State Farm, GM, AT&T, Toyom Hostess Brands, Tyson Foods).

And now … questions

Thanks for listening !