Tag: LaVaughn Henry

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Federal Reserve Finds Cincinnati Out-Performing Many Of Its Regional, National Peers

The Vice President and Senior Regional Officer of the Federal Reserve Bank of Cleveland‘s Cincinnati Branch, LaVaughn Henry, says that the Cincinnati Metropolitan Statistical Area continues to show positive signs in recovering from the Great Recession, and is moving toward a position of long-term growth.

At approximately 2% higher than its pre-recession level, Henry says that per capita GDP in the Cincinnati area is out-performing other nearby metropolitan areas, along with the rest of Ohio.

Likewise, the unemployment rate is lower in Cincinnati than other metropolitan areas nearby. It is currently 4.1%, the lowest level in a decade. However, employment is still nearly 2% below its pre-recession level in the Cincinnati region.

The construction industry has seen large employment gains in the area, driven by increased home sales but also by Cincinnati’s ongoing center city construction boom.

Henry reports that the region’s manufacturing is also growing healthily, surpassing the growth seen both nationally and state-wide. This growth, he says, reflects increased demand from the aviation and automobile sectors of the U.S. economy. These two sectors, however, only account for 4% and 10% of the metropolitan GDP, respectively.

Larger sectors like transportation and utilities, while still seeing growth, are increasing at a slower pace.

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Federal Reserve Has Rosy Outlook for Cincinnati’s Over-Performing Economy

A spring 2015 update on the economic health of the Cincinnati region from the Federal Reserve Bank of Cleveland gives reason for optimism when it comes to the area’s recovery.

The Cincinnati metropolitan area is recovering at a rate equal to that of the nation, and production, income, and GDP are all up in the area. LaVaughn Henry, vice president and senior regional officer of the Federal Reserve Bank of Cleveland’s Cincinnati Branch, cited the area’s diversified economy as one reason for robust growth.

More specifically, the Fed pointed to Cincinnati’s large employment percentages in the consumer marketing field as a reason for its success. As the nation continues to recover and consumer confidence and consumption rise, Cincinnati is poised to benefit at a greater rate than other metropolitan areas.

Further bolstering the region’s growth are the construction and manufacturing sectors, having grown 7% and 4% over the last year, respectively. Healthcare and education are also growing, while the area’s business and professional sectors are lagging behind national averages.

Overall Cincinnati’s performance seems to be mirroring that of the nation, with high growth in manufacturing and construction, stagnant growth in government, and large drops in the information sector.

The region’s employment rate now stands at 4.5%, nearly a point lower than the national average and the lowest level in 10 years. The average Cincinnatian is seeing the fruits of this economic growth, with wages growing faster than the rest of Ohio and other nearby metros. Henry says that wages are poised to reach an average of $840 a week – a level not seen since 2007.

The region, however, has not yet managed to reach pre-Recession employment levels. This is in line with the national trend, although behind local metropolitan areas.

The Federal Reserve Bank of Cleveland also cited recent announcements from companies planning major job expansions as reason for continued optimism that the area’s employment growth will continue. While the local housing market has seen sluggish growth, the Henry says that shrinking housing supply and increased construction will strengthen the sector.

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Economists: Cincinnati’s Regional Economy Outperforming Both Pittsburgh and Cleveland

Cincinnati Children's Hospital Medical Center Research Tower

Analysis of data recently released by the Cincinnati Branch of the Federal Reserve Bank of Cleveland shows the area’s economy in a relatively healthy position compared to nearby metro areas, and to the nation as a whole.

LaVaughn Henry, Vice President and Senior Regional Officer at the Cincinnati Branch, says that he believes the region’s economy is poised for continued economic growth, and he points to several factors that contribute to his optimism – a highly educated workforce, an economy healthily spread amongst different sectors, and numerous Fortune 500 companies headquartered in the city.

When diving into the numbers, Henry points to 30% of the regional workforce holding a bachelor’s degree as an item that makes the city an attractive place to do business.

He also touts the city’s relatively low unemployment rate which stands at 5.2% – about even with Pittsburgh and a full percentage point better than the rates nationally and for the state of Ohio. Making the area’s economy even stronger is the fact that its top industry sectors – professional and business services, health and education, and skilled manufacturing – all continue to experience healthy growth.

The Federal Reserve also pointed to continued capital spending as a bright spot that is boosting employment and earnings. Specifically, two hospital expansions and the opening of General Electric’s Global Operations Center at The Banks are expected to support thousands of jobs through 2016.

While the data found that Cincinnati is out-performing many of its peers, it also found that it has room for improvement in terms of wage and GDP growth.

Wages, the Federal Reserve says, have yet to reach pre-recession levels locally, and, while growing, are growing modestly at best. Researchers say that Cincinnati is suffering from a national problem of too many workers in the labor market, and high growth in low-paying service sector jobs that depress wage data. And while the region’s gross domestic product is growing faster than the national average, economists note that, like wages, it has yet to reach pre-recession levels.

When compared to Pittsburgh and Cleveland, the only other two metropolitan regions with more than 2 million people in the Federal Reserve Bank of Cleveland district, Cincinnati is, by far, the healthiest performer.

In Cleveland economists note that its economy is recovering from the Great Recession much better than the recession of 2001, yet it continues to trail national averages. While unemployment is falling throughout the region, it remains stubbornly high at 6.8% – above both the national and state averages. A bright spot, however, is Cleveland’s 28.5% bachelor’s degree rate within the workforce is at least on-par with the national average.

Pittsburgh, meanwhile, recovered the quickest of the three from the Great Recession, but has since seen its economic indicators stall. While unemployment has consistently stayed below the national average, growth in almost all industries in the city was lower than the national average. And while GDP grew from 2009 to 2012, economists at the Federal Reserve expect the data to be somewhat more somber once data is released for 2013 and 2014.