From hurricanes ripping through the state to a potential third interest rate hike and President Trump’s new tax proposal, some may be nervous about the future of our country’s economy.
Luckily for Greater Gainesville, things are looking up. Boyd Nash-Stacey, an economist researcher for BBVA Compass, spent a day at the University of Florida Hilton in early October talking about his economic predictions for the New Year and telling shareholders and clients the progress of BBVA Compass.
The state of Florida is no stranger to hurricanes, and with strong winds come strong economic impacts as well. Nash-Stacey predicts that the economic impact of Hurricane Irma on the state was about $52 billion. Half of the $52 billion is due to physical damages, and the other half was caused by a lack of transactions. Though the loss was big, Nash-Stacey and the rest of BBVA’s economic research team believe that Irma will only have short-term effects on the state.
“There were no long-term structural damages from Irma, and we expect a pretty quick recovery,” said Nash-Stacey.
The GDP forecast for 2017 for Florida is 2.6 percent including hurricane damages, which is higher than the national average of about 2 percent. Nash-Stacey predicts next year’s GDP will be about 3.5 percent, much higher than the national average.
With 2018 right around the corner, the uncertainty of a possible tax reform lingers. What happens to the country’s GDP depends on the decisions of the Trump Administration. If there is an agreement on a comprehensive tax reform, it is predicted that 2018’s GDP will be around 2.4 percent. However, the longer a plan is delayed, the less likely we will see the positive effects of a tax reform anytime soon. The earliest the country would see a new tax plan go into effect would be in the second quarter of 2018, according to Nash-Stacey.
Looking toward the local economy, Greater Gainesville seems to be progressing very strongly. The State of Florida’s unemployment rate is currently about 3.5 percent, which is below the national average. Robert McDaniel, the City President of BBVA Compass, points out that the recent development of two new hospitals in the area will continue to have a positive economic impact. There has also been an expansion of technology and biology sectors in the area over the last decade.
“These are really key economic drivers for us,” said McDaniel.
A possible third interest rate hike may be coming in the near future, but Nash-Stacey and the researchers at BBVA Compass believe it is in the Federal Reserve’s best interest to continue with their course of normalization. According to Nash-Stacey, there will be another rate increase before the end of the year. With 2017 on the horizon, Nash-Stacey is optimistic about the future of our country’s economy. “From a domestic perspective, things are in a very good position,” said Nash-Stacey.
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REBECCA PAPILSKY is a senior at the University of Florida majoring in Public Relations and minoring in Leadership. When she’s not out conducting interviews or posting on social media, she enjoys exploring Gainesville’s food scene, reading or finding a puppy to play with.