As the national economy slowly recovers from what one economist called the Great Recession," La Plata County faces a
number of challenges that could dampen 2010, economists said Friday.
Home prices locally probably have not bottomed out, although real estate transactions have risen, said Robert Sonora, a
Fort Lewis College associate professor of economics.
Labor markets will continue to be soft, but unemployment in La Plata County remains below state and national averages,he said. And tourism could suffer from high unemployment that reduces discretionary income, he said.
Sonora was part of a panel of economists who spoke at the Southwest Business Forum at Fort Lewis College. The event, in
its 18th year, drew business owners and public officials to the college's Community Concert Hall.
Nationally, most economists believe the Great Recession" of 2008-09 ended around July, said Scott Anderson, senior
economist at Wells Fargo Bank.
We are not predicting a double-dip recession, at least over the next 12 to 18 months," Anderson said.
Anderson, like the other economists, praised the Federal Reserve's handling of the national economic crisis. At least
at first blush, the Fed's interventions have been very effective," he said.
Anderson said he was pretty skeptical" that the Fed would raise interest rates anytime soon.
Richard Wobbekind, director of the Business Research Division at the University of Colorado at Boulder, predicted
commercial real estate would be the next shoe to drop."
You have a lot of excess retail capacity right now," Wobbekind said.
On the positive side, Wobbekind forecast 2.7 percent retail sales growth. Job growth of 6.5 percent in professional and
business services and 5.9 percent in health care and private education should dampen losses in accommodations, leisure
and hospitality, and government, he said.
Overall, Wobbekind said, total employment will decline 3.2 percent in Colorado in 2010.
The job growth that does occur will come in the last half of 2010, he said. It's going to be back-end loaded," he
Anderson, the Wells Fargo economist, turned out to be something of a lightning rod for audience questions. One man
asked if America has created a monster" by allowing banks to become so big that they can't be allowed to fail.
Anderson said he did not foresee the return of prohibitions included in the Glass-Steagal Act, a bill passed in
response to the Great Depression that curbed some banking practices. But, he said, some legislation, like that being
considered in Congress now, may be enacted.
I don't think the banks - the responsible banks - are saying we don't need some of that," Anderson said.
Anderson laid much of the blame for the financial crisis on aggressive investment banks. Banks like Wells Fargo,Anderson said, were victims" of the crisis that were left cleaning up the mess."