The 20162017 Employment Forecast for

Battle Creek MSA

Can it get any better than this?
Randall Eberts
Brian Pittelko
W.E. Upjohn Institute for Employment Research
January 14, 2016

A Special Thanks to

for their sponsorship.

1

Why am I hereand not this guy?

The answer

Retirement and

a new grandson

"

," said Ed Yardeni,

HAPPY NEW YEAR!!??

Crude oil continues to nosedive.
Crude plunged as much as 4% to
$32.10 a barrel, the lowest level
since late 2003.

Most of the blame goes to China

Investors are also alarmed by
the decline in Chinas currency
4

Others think stocks will rebound from

the China fears, which is exactly
what happened last summer.
"There isn't really some new structural smoking gun for

the economy and markets like mortgages were back in

2008," Kopp said.

This bull market will celebrate its

seventh anniversary in early March.
5

The news last week wasnt newslowing Chinese

economy, but another bad week for Chinas stock market..

2016-01-08

2016-01-07

2016-01-06

2050

2016-01-05

2016-01-04

2016-01-03

2016-01-02

2016-01-01

2015-12-31

2015-12-30

2015-12-29

2015-12-28

2015-12-27

2015-12-26

2015-12-25

2015-12-24

2015-12-23

2015-12-22

2015-12-21

S&P500 Index

and not so good for the U.S. stock market

2100

6% decline
in the first week

2000

1950

1900

1850

1800

But lets put last week behind us (and much of this

week) and look at why 2016 should not be 2008
China stock market problems do not equal a global financial
meltdown
Strong fundamentalsat least GDP and employment
Growing consumer confidence and solid balance sheet
No apparent bubbles; housing coming back
Tempered by
Weak international economies
Continued strong stimuli in US
Strong dollar (good for low inflation and imports/bad for
exports)
Mental fatigue (whatever that means)
8

Whats on the docket for this morning

National view of what the economy looks like
today compared to 2007
Turn to the state economy to take its pulse and
See how it might affect Battle Creek MSAs
(Calhoun Countys) economy in 2016
Which all leads up to

National

10

GDP is still relatively strong and expected to keep chugging

along through 2016
6

Consensus forecast

4
2
0

Q1 2016

-2
-4

Q1 2008
-6
-8
-10

-7

-6

-5

-4

-3

8 qtrs before now

-2

-1

8 qtrs before recession

11

Employment growth is quite stronglast three months it

was above the 24-month average of 240,000 and above
the 63-month average of 205,000 per month
500

Monthly change in employment

400

24-month average
2014-2015 of
240,000

300

200

100

24-month average
2006-2007 of
134,000

0
-24 -23 -22 -21 -20 -19 -18 -17 -16 -15 -14 -13 -12 -11 -10 -9

-100

-8

-7

-6

-5

-4

-3

-2

-1

Months since January 2016

2014-2015

2006-2007

12

The consensus forecast sees employment growth continuing at an

average monthly increase of 197,000 whereas 2008 was a blood
bath, losing close to 1 million jobs
400

Consensus forecast

Monthly change in employment

200

-200

-400

-600

-800

-1000
-6

-5

-4

-3

-2

-1

10

11

12

Months from January of 2008 or January 2016

2016 forecasts

2008 actual

13

Forecasts look for continued employment

growth in the next two years
Consensus Forecast
Annual employment change (millions)

3.5

258,000/ mth
3

221,000/mth

197,000/mth

2.5
2

133,000/mth
1.5
RSQE (U of M)
Forecast

1
0.5
0
2014

2015

2016

2017
14

Source: University of Michigan RSQE & Upjohn Institute

Demand for workers is strongnumber of job seekers

per opening Is back to pre-recession levels
U.S. Job Openings and New Hires
8
Job openings at end of month

5,000

Thousands (000s)

6
4,000

3,000

4
3

2,000

2
1,000

Unemployed / job openings

6,000

Job seekers per opening

0
2006

2007

2008

2009

2010

2011

Source: BLS Job Opening and Labor Turnover.

2012

2013

2014

2015
16

Question is whether supply can keep up

Employment growth depends upon:
Population growth, primarily immigration
Labor force participation growth
Employment per labor force (flip side of natural rate of
unemployment)
Over the long-run, many analysts believe that the trends are
moving in the wrong direction:
Population growth is slowing from 1.2 percent to less than
1 percent, unless immigration picks up.
As the workforce ages and young people postpone
entering the workforce, LF participation continues to fall
16

Facing possible skills shortage of those in the labor

forcebut this has not caused wages to increase
Year-over-Year Change in Total Compensation of
Private Industry Workers
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
2005

2006

2007

2009

2010

2011

2012

2014

2015
17

Source: BLS.

In the past five years, consumer confidence has risen

and so has household debt, but not where it was in
2008135% of disposable income v. 103% now
35
30
25
20
15
10
5
0
-5
-10
-15

120
100
80
60
40

Index: 1995 = 100

Billions ($)

Consumer Confidence and Change in Consumer Debt

20
0
2010

2011

2012

Consumer debt

2013

2014

2015

Consumer confidence
18

Source: New York Federal Reserve and Conference Board.

Consumers are not spending beyond their

meansrate falling as more people are working
Personal Outlays as a Percent of Personal Income
88%
87%
86%
85%
84%
83%
82%
81%
80%
79%
78%
77%
1991

1996

2001

2006

2011

2016
19

Source: BEA.

What about possible bubbles?

20

A housing bubble? No, home prices have recovered and

are back to about where they were before the recession
Housing Price Index 1991=100
250
200
150
100
50
0
1991

1996

2001

2006

2011

2016
21

Source: Federal Housing Finance Agency.

45.00

30.00

1998.01
1998.07
1999.01
1999.07
2000.01
2000.07
2001.01
2001.07
2002.01
2002.07
2003.01
2003.07
2004.01
2004.07
2005.01
2005.07
2006.01
2006.07
2007.01
2007.07
2008.01
2008.07
2009.01
2009.07
2010.01
2010.07
2011.01
2011.07
2012.01
2012.07
2013.01
2013.07
2014.01
2014.07
2015.01
2015.07

S&P500 Price Earnings Ratio

Stock market bubble? No, price-to-earnings

ratio slightly below average since 2001
50.00

Thats a bubble

40.00

35.00

2001-2015 average=27

25.00

20.00

15.00

10.00

5.00

0.00

22

Is there a bubble in the auto industry? No, sales

have been gradually moving upward
20
18
16
14
12
10
8
6
4
2
0

1600

1400
1200
1000
800
600
400

Unit inventories (000s)

Seasonally adjusted annualized sales (millions)

U.S. Light Vehicle Sales and Inventories

200
0
2010

2011

2012

2013

Total light vehicle sales

2014

2015

Unit inventory
23

Source: New York Federal Reserve and Conference Board.

and in the long-term it looks like were just

returning to Normal
Annualized Rate of U.S. Light Vehicle Sales (in millions)
24

Annual rate of sales (in millions)

22
20
18
16
14
12
10
8
6
4
2
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
8
Source: BEA.

Car Industry Fundamentals

In 2014, the average age of a vehicle on the road was
11.4 years v. 9.8 years in 2007.
With low gas prices, CUVs, SUVs, and pick-ups are
back
According the BLS, auto prices are trending with the
prices of all goods
U of M is forecasting car sales to reach 18 million
units in 2016 and 2017. Wow!

25

What about the effect of lower gas prices?

% chg Dec. 14-Dec. 15 % chg 14 15
Total Cars
Total Trucks

-3.2
+19.0

-2.2
+13.1

What about the effect of strong dollar?

% chg Dec. 14-Dec. 15 % chg 14 15
Domestic cars
Import cars
Domestic trucks

-10.4
-0.5
+16.0

-5.4
-0.9
+11.1

Import trucks

+23.5

+16.0
26

Other Bubbles?
Oil? No, current OPEC policies appear aimed
at keeping new oil reserves off line, by keeping
prices low. If it raises its price, supply will likely
increase. Prices just fell below $30/barrel
Housing prices in major cities? No.
Yet, you may never see a bubble until it bursts

27

Concerns: Sluggish international economies, with

some teetering on the edge of another recession and
China loosing steam
Percent Change in GDP over the Previous Year
12
China

10
8
6
4

U.S

2
0
Japan

OECD Europe

-2
-4
2010

2011

2012

2013

2014

2015
28

Source: OECD.

Even though China continues to be a larger player in the world

economy, its share of the world equity market is quite small
Brazil Share of World Equity Market
1%

Share of World Economy ($US)

2014

Brazil
3%
China
13%

Japan
6%

other
43%

other
26%

Japan
7%

China
2%

Germany
3%
France
3%
UK
6%

Germany
5%

UK
4%

US
22%

France
4%

US
52%

29

Stimulus is still present: Even with the recent Fed

Funds hike, short-term interest rates are close to zero
Interest Rates and Inflation

Annual percentage rate

6
5
4
3
2
1
0
-1

2010

2011

2012

2013

2014

3 month T-Bill

New home mortgages

10 year T-Bill

CPI-U 12-month change

Source: New York Federal Reserve and BLS CPI.

2015

The Banking Situation Looks Calm

Federal Reserve Senior Loan Officers Survey:
Demand and Lending Standards for Commercial and Industrial Loans
by Medium-to-Large Firms
40
30
20
10
0
-10
-20
-30
2010 Q1

2011 Q1

2012 Q1

2013 Q1

Reporting stronger loan demand

Source: BEA and Federal Reserve.

2014 Q1

2015 Q1

Reporting tightening standards

31

One reason the Fed has been reluctant to raise rates is

the low inflation rate: below the Feds target of 2%.
Year-Over-Year Change in the PCE Price Index
6.0%
5.0%

4.0%
3.0%
2.0%
1.0%
0.0%
-1.0%
-2.0%
1990

1995

2000

Source: BEA PCE Price Index.

2005

2010

2015

32

The value of the dollar has skyrocketed in recent

monthshelps to keep down inflation but could be
trouble for manufacturing and other export-heavy sectors

0
Biggest rally in 40 years

Trade Balance

-10,000
-20,000
-30,000
-40,000
-50,000
-60,000

2010

2011

2012

Trade balance

2013

2014

95
90
85
80
75
70
65
60
55
50

Index

U.S. Trade Balance and Nominal Index of the Value of the Dollar
against Seven Major Currencies

2015

Major currencies' dollar index

Source: BEA and Federal Reserve.

33

Is the economy getting tired? Only 4 business cycles

have ever lasted longer than our current cycle of 96
monthsand all but one occurred since 1960
Real GDP Index
160

1960-1969

150

1991-2001

140
130

1981-1990

120

2001-2007

110

2007-present

100

Q43

Q41

Q39

Q37

Q35

Q33

Q31

Q29

Q27

Q25

Q23

Q21

Q19

Q17

Q15

Q13

Q11

Q9

Q7

Q5

Q3

Q1

90

34

If we could replicate the 1990s, we could enjoy another 3 years

of expansion before were the longest in US history
Employment Index
1960-1969

1981-1990
1991-2001
2001-2007
2007-present

M1
M6
M11
M16
M21
M26
M31
M36
M41
M46
M51
M56
M61
M66
M71
M76
M81
M86
M91
M96
M101
M106
M111
M116
M121
M126

135
130
125
120
115
110
105
100
95
90

35

At this stage of the business cycle, interest rates in other BCs

were considerably higher, which means those expansions were
sustainable without the extra stimulus this one is still receiving
Interest Rates

M1
M6
M11
M16
M21
M26
M31
M36
M41
M46
M51
M56
M61
M66
M71
M76
M81
M86
M91
M96
M101
M106
M111
M116
M121
M126

20
18
16
14
12
10
8
6
4
2
0

1960 Peak

1981 Peak

1991 Peak

2001 Peak

2007 Peak
36

Summing up the national scene

It is hard to find a cause for a recession in 2016
strong fundamentals: GDP, jobs, confidence, debt
However, there are some headwinds
Sluggish international markets, particularly Chinas slowing
growth rate
High value of the dollar could slow manufacturing and
other exports even more
High value of the dollar will moderate inflation but that
could prevent the Fed from raising interest rates, which
may be good now but not good if we head into another
recession
Possible labor and skills shortages (perceived or actual) 37

Michigan

38

Michigan Employment Trends

From 3rd Quarter 2014 to 3rd Quarter 2015,
employment increased by 90,000 jobs
Manufacturers added 24,000 jobs during the
four quarters; US added only 126,000
Michigans GDP grew 4.5% in Q2, 13th best in US
If you are willing to assume an employment
multiplier for manufacturing of 3.8, all of the
states employment growth during the period
was duedirectly and indirectlyto its
manufacturers
39
Source: University of Michigan.

Manufacturing clearly stands above

the other sectors in growth
Employment Change, Q3 2014 to Q3 2015
30

Manufacturing

25
Health care

Job change (000s)

20
15
10
5

Prof., tech.
Construction

Hospitality

Retail trade
Finance
Transport., util.

0
-5

Admin. and support

Other serv.
Real estate

Wholesale

Information

Educ. services

Management

Arts, ent., rec.

-10
Government

-15

40
Source: BLS CES.

Again, possible skills shortages are not

reflected in higher wages
Average Hourly Wage in Michigan, 2015 dollars
30

Hourly wage ($)

25
20
15
10
5
0

2007

2008

2009

2010

2011

2012

2013

2014

2015
41

Source: BLS CES.

Michigan employment forecasted to grow over the

next 2 years but at a slightly slower pace than nation
Employment Forecast
2.5

Annual pct change

2.1

2.2

2.0

1.7

1.6
1.4

1.5

1.5

1.0
0.5
0.0
2015

2016

United States

2017

Michigan
42

Source: University of Michigan RSQE & Upjohn Institute

The states unemployment rate continues to decline

and stands only a few points above the nations
Unemployment Rate
16
Percent of labor force

14
12

10
8
6
4
2
0
2000

2003

2006

2009

2012

2015
43

Source: BLS LAUS.

Battle Creek MSA

44

Manufacturing and health/education are big

drivers of the local economy
Employment Change, 2014 to Estimated 2015
Education &
Health

800
600

Manufacturing

400
Prof. and
Business

200
0

Financial

-200 Mining, Logging,

Const.
-400
-600

Leisure &
hospitality
Other Services
Government

Trade,
Transport., and
Util.
Source: BLS CES.

45

The countys unemployment rate is down to

2002 level and.
Unemployment Rate for Calhoun County
14
12
10
8
6
4
2
0

2000

2002

2004

2006

Source: BLS LAUS and Upjohn Institute.

2008

2010

2012

2014
46

It is for the right reasons the unemployed and

those who had previously given up are finding jobs.
November-to-November Change- Calhoun County
Employment
Change

Unemployment
Change

Year

Labor Force Change

2011

-994

460

-1,655

2012

-132

518

-740

2013

424

623

-227

2014

1,706

2,649

-1,095

2015

359

895

-611

Source: MI Labor Market Indicators, Local Area Unemployment Statistics.

47

Nonfarm Employment Index (2000 = 100)

110
105

100
95
90
85

The area lost 3,850 jobs

during the recession, but
gained 5,150, so far, in the
recovery

80
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

U.S.

Michigan

Battle Creek MSA

16

Source: BLS and Upjohn Institute, seasonally adjusted.

Manufacturing Employment Index (2000 = 100)

105

95
85
75
65
55
45
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

U.S.

Michigan

Battle Creek MSA

18

Source: BLS and Upjohn Institute, seasonally adjusted.

Services Employment Index (2000 = 100)

120
115
110
105
100
95
90
85
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

U.S.

Michigan

Battle Creek MSA

17

Source: BLS and Upjohn Institute, seasonally adjusted.

But what about the areas core industries?

How did they weather the storm?
Time period of the analysis: 2004 to 2014
Definition of the core: An industry that is at
least twice as concentrated in the Battle Creek
MSA than nationwide
The question: Did these industries outperform
their national rivals?

51

List of Core Industries

Food manufacturing
Printing
Fabricated metal manufacturing
Transportation equipment manufacturing

52

Core Industries
Food
Printing
Fabricated metal
Transportation equipment

Job change due only to the

areas firms outperforming
their national rivals
-1,815
22
355
32

53

Battle Creeks housing prices have so ways to go

before prices return to pre-recession levels
FHFA Housing Price Index (1995=100)
200
180
160
140

120
100

80
60

40
20

Source: FHFA Housing Index.

2015

2014

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

54

High demand for healthcare workers

Job Posting Change, 2014 to 2015, All Occupations
Healthcare
Management
Cleaning and Maintenance
Transportation
Architecture and Eng.
Computer and Mathematical
Installation, Maintenance, and Repair
Community and Social Services
Healthcare Support
Production
Protective Service
Office and Admin
Life, Physical, and Social Science
Sales and Related
Construction
Arts, Design, Ent., etc
Business and Financial
Education
Personal Care and Service
Food Prep and Serving
-200 -100 0 100 200 300 400 500 600 700
Source: BurningGlass Labor Insight

Comparison Analysis
Comparison Areas:

Altoona, PA
Jackson, MI
Johnstown, PA
Lebanon, PA
Mansfield, OH

Monroe, MI
Muncie, IN
Springfield, OH
Wausau, WI
Williamsport, PA

Comparison Criteria

All one-county metropolitan areas

Within Midwest region
Not college town or state capitol
All within 15% of Calhoun Countys population
(plus Jackson)

BCs unemployment rate slightly less than

average for the 10 comparison areas
Average Unemployment Rate, JanNov 2015
Battle Creek
Comparison Average
Wausau, WI
Monroe, MI
Lebanon, PA
Springfield, OH
Altoona, PA
Jackson, MI
Mansfield, OH
Muncie, IN
Williamsport, PA
Johnstown, PA

5.0
5.2
4.0
4.5
4.5
4.8
5.2
5.2
5.4
5.9
6.0

6.5
0

Source: BLS.

7
58

BCs employment growth keeps pace with faster

growing area
Percent Change in Total Employment,
JanNov 2014 through JanNov 2015
Battle Creek, MI
Comparison Average
Monroe, MI
Muncie, IN
Wausau, WI
Springfield, OH
Jackson, MI
Mansfield, OH
Johnstown, PA
Altoona, PA
Williamsport, PA
Lebanon, PA

2.3%

0.8%
2.3%
2.0%
1.9%
1.4%
0.7%
0.5%
0.2%
0.1%
-0.5%
-0.9%

-1.5%
Source: BLS.

-1.0%

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%
59

Except for Monroe, MI, BCs manufacturing

employment outpaces the rest
Percent Change in Manufacturing Employment,
JanNov 2014 through JanNov 2015
Battle Creek, MI
Comparison Average
Monroe, MI
Jackson, MI
Wausau, WI
Muncie, IN
Mansfield, OH
Lebanon, PA
Altoona, PA
Williamsport, PA
Springfield, OH
Johnstown, PA

3.2%
0.8%

11.3%
2.5%
2.3%
0.0%
-0.1%
-0.7%
-1.0%
-1.6%
-2.2%
-2.6%
-4%

Source: BLS.

-2%

0%

2%

4%

6%

8%

10%

12%
60

Service sector employment growth also strong

Percent Change in Service Providing Employment,
JanNov 2014 through JanNov 2015
Battle Creek, MI
Comparison Average
Muncie, IN
Springfield, OH
Wausau, WI
Monroe, MI
Mansfield, OH
Williamsport, PA
Jackson, MI
Altoona, PA
Johnstown, PA
Lebanon, PA -1.8%
-2.0%
Source: BLS.

2.2%
0.8%

2.3%
2.1%
1.6%
1.0%
0.8%
0.5%
0.5%
0.4%
0.2%
-1.0%

0.0%

1.0%

2.0%

3.0%
61

BC lags in attain of Bachelors Degrees or higher

Bachelors Degree or Higher, Age 2534
Battle Creek
Comparison Average
Muncie, IN
Altoona, PA
Wausau, WI
Johnstown, PA
Williamsport, PA
Lebanon, PA
Monroe, MI
Jackson, MI
Springfield, OH
Mansfield, OH

17.9%
23.6%
29.5%
27.6%
27.5%
26.4%
25.4%
22.6%
21.8%
19.3%
18.5%
17.3%
0%

5%

Source: ACS 2010-14.

10%
15%
20%
Percent of age group

25%

30%
62

 but not quite as much in Associates degees

Associates Degree or Higher, Age 2534
Battle Creek
Comparison Average
Wausau, WI
Johnstown, PA
Monroe, MI
Williamsport, PA
Altoona, PA
Lebanon, PA
Springfield, OH
Mansfield, OH
Jackson, MI
Muncie, IN

11.2%
10.8%
15.8%
14.0%
13.8%
11.5%
9.2%
9.2%
9.0%
9.0%
8.3%
8.1%
0%

5%

Source: ACS 2010-14.

10%
15%
20%
Percent of age group

25%

30%
63

Growth in per capita personal income slowed

because of lower education level
Pct Change in Per Capita Personal Income, 2013-2014
Battle Creek
Comparison Average
Wausau, WI
Williamsport, PA
Monroe, MI
Mansfield, OH
Springfield, OH
Altoona, PA
Muncie, IN
Lebanon, PA
Johnstown, PA
Jackson, MI

2.6%
3.7%
5.2%
4.2%
4.0%
4.0%
3.9%
3.8%
3.1%
3.1%
3.0%
3.0%
0%

Source: BEA

1%

2%

3%
4%
Percent change

5%

6%
64

So What Is Our 2016 and 2017

Employment Forecast for Battle Creek?
But wait, how did we do last year?

65

How did we do in 2015?

Annual Percent Change in Employment
Percent change in employment

5.0%

4.4%

4.0%

3.0%

2.3%

2.7%
2.1%

2.5%

1.8%

2.0%

1.2%
1.0%
0.0%

-0.3%

-1.0%
Total

Goods producing

Current estimate

Service providing

Government

Forecasted
66

Drum roll please . . .

67

But before thatwhat did we consider in

deriving the forecast?

68

Pretty flat here

Number of Dwelling Units Put Under Contract for Construction
(SAAR*)
80
70
60
50

40
30
20
10
0
2000

2002

2004

2006

New dwelling units

Source: Dodge Data and Analytics.

2008

2010

2012

2014

12-month moving average

*Seasonally adjusted annual rate

69

Not much happening here

Construction Permits Issued, Calhoun Co.
450
400
350
300
250
200
150

100
50
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015*

Total, All Structure Types

Source: U.S. Census.

Single Family Houses

Year to date, November 2015

70

Brian Longs PMI Is stable, but there are signs of

slippage
Purchasing Managers Index
80

70
60
50
40
30
20
10
0

2008

2009

2010

2011

Purchasing Managers Index

2012

2013

2014

2015

12-month moving average

71

Source: National Association of Purchasing Management.

Real wages have been flat since 2000

Total Nonfarm Wages (2015 Dollars)
Average weekly wage ($)

1,400
1,200
1,000
800
600

400
200
0

Michigan

Battle Creek MSA

72

Source: Michigan LMI and BLS CPI.

 and wages in manufacturing are weakening

Average weekly wage ($)

Manufacturing Wages (2015 Dollars)

1,800
1,600
1,400
1,200
1,000
800
600
400
200
0

Michigan

Battle Creek MSA

54

Source: Michigan LMI and BLS CPI.

Brian Longs PMI Is stable, but there are signs of

slippage
Purchasing Managers Index
80

70
60
50
40
30
20
10
0

2008

2009

2010

2011

Purchasing Managers Index

2012

2013

2014

2015

12-month moving average

74

Source: National Association of Purchasing Management.

And nowat lastthe forecast

75

Battle Creek MSA -REVISED

20162017 Preliminary Forecast
Annual Percent Change in Employment
Percent change in employment

3.0%
2.5%

2.7%
2.5%
2.3%

2.2%

2.0%
1.6%

1.5%

1.6% 1.6%
1.3%

1.2%

1.0%

0.8%

0.8%

0.4%

0.5%
0.0%
Total

Goods producing Service providing

2015

2016

Government

2017
76

Employment growth in 2016 will be faster than

the states
Employment Forecast
2.5

Annual pct change

2.1

2.2

2.3

2.0

1.7

1.5

1.6

1.6

1.4

1.5

2016

2017

1.3

1.0
0.5
0.0
2015

United States

Michigan

Battle Creek MSA

Source: University of Michigan RSQE & Upjohn Institute

Parting Thoughts
US, Michigan, and Battle Creek are in a relatively
good position with basically strong fundamentals
It is highly unlikely that the economy will turn
negative in 2016. However, it could slow due to:

Sluggish international markets

Dramatic drop in consumer confidence
Continued obsession with China
Fiscal austerity: lessons from Europe
Unforeseen events

Of course, 2016 is an election year and

78

The 20162017 Employment Forecast for

Battle Creek MSA
Can it get any better than this?
Randall Eberts
Brian Pittelko
W.E. Upjohn Institute for Employment Research
January 14, 2016