MILWAUKEE, WI--(Marketwired - Aug 14, 2014) -
- Manufacturing recovery slowed in 2013, but activity poised to improve
- Labor market performing well amid solid payroll growth
- Housing market showing stability
The Wisconsin economy rebounded in 2013, with real GDP expanding at 1.7 percent driven by improvements in agriculture output, construction activity and retail and wholesale trade. According to the bi-annual U.S. State Monitor Report from BMO Economics, growth is expected to pick up to 2.1 percent in 2014, on par with the national average, and continue the momentum into 2015 with growth forecasted at 2.6 percent.
"Manufacturing has been one of the softer areas, but we do expect increased business investment to help support both manufacturing and exports in Wisconsin in the coming year," said Robert Kavcic, Senior Economist, BMO Capital Markets. "Employment is overall on solid footing, with non-farm payrolls up 1.8 percent in Q2 of this year, right in line with what we are seeing at the national level."
The state jobless rate fell to 5.7 percent in June, matching the lowest level since October 2008. However, the participation rate remains low and wage growth is moderate at around 2 percent year over year.
"Business owners in Wisconsin, large and small, continue to express confidence in their business prospects for the future," said Jeff Ticknor, Managing Director and Head, Diversified Industries, Wisconsin, BMO Harris Bank. "We're seeing that optimism reflected in their growth ambitions and the investments they are making in their businesses."
"Home prices in the state are on their way up, although not rallying with the same vigor we are seeing in the states that experienced major drops during the downturn," added Mr. Kavcic. "The state's housing vacancy rate and foreclosure rates are both below the median across all the states, and the months' supply of homes for sale in Milwaukee is back down to the levels we saw pre-recession."
Exports levels have remained largely the same in the last year, which can be attributed to a drop in machinery shipments as well as the general slowdown in manufacturing output. However, the Milwaukee PMI recently hit a 3-year high amid gains in production and new orders.
State finances remain in good shape, with fund spending expected to grow 4.7 percent in fiscal 2014 after personal income tax cuts were brought in last year.
To view a full copy of the report, visit www.bmocm.com/economics
About BMO Harris Bank
BMO Harris Bank provides a broad range of personal banking products and solutions through more than 600 branches and approximately 1,300 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Arizona and Florida. BMO Harris Bank's commercial banking team provides a combination of sector expertise, local knowledge and mid-market focus throughout the U.S. For more information about BMO Harris Bank, go to the company fact sheet. Banking products and services are provided by BMO Harris Bank N.A. and are subject to bank or credit approval. BMO Harris® and BMO Harris Bank® are trade names used by BMO Harris Bank N.A. Member FDIC. BMO Harris Bank is part of BMO Financial Group, a North American financial organization with approximately 1,600 branches, and CDN $582 billion in assets (as of April 30, 2014).