The national economic outlook, trade policies and the possibility of a recession were all points of discussion during Thursday’s annual Economic Summit at the Lynchburg Regional Business Alliance.
The event’s featured speaker was Mark Vitner, director and senior economist at Wells Fargo Securities, who is responsible for tracking U.S. and regional economic trends.
He said recession concerns have abated significantly as, among other things, stock markets have reached new all-time highs.
There are a few obvious imbalances present in the economy today and growth is broadening, he said.
Vitner said the real GDP growth, or real gross domestic product rate growth, across the country has decelerated from a 3% pace last year to about 2% and looks set to slow even further. He said most of the slowdown is tied to weakening global growth and its impact on exports and capital spending.
He also talked about tax reform and said it continues to bolster real after-tax income, but trade uncertainty has upended the boost to capital spending.
“After cutting rates three times, the federal government is likely on pause until early next year or possibly even later,” he said, referring to the Federal Reserve’s recent moves on interest rates.
He said views about the prospects for a China trade deal appear too pessimistic and while a deal will take time, a short-term and long-term agreement are in the best interests of both nations. Vitner said negotiations remain contentious.
On the topic of wages and salaries, he said they both continue to rise the fastest for people at the lower end of the pay spectrum, which has boosted spending at discount stores.
“Consumers remain optimistic about the economy and their finances,” he said.
Traci Blido, director of economic development for Bedford County, asked Vitner who he thinks are the biggest state competitors to Virginia.
Vitner said Texas is doing the best job right now. He said economic expansion is unique right now because fewer people are moving in the United States than any other time in the past 50 years.
Megan Lucas, CEO of the Alliance, said talent development strategy across the country is important to generating new jobs and capital investment.
“It’s important to retain the companies that call us home and we are fortunate in this region [to have people] working on retaining the workforce and training the workforce that call our community home, which then in turn will help us recruit new working companies,” she said.
She told business leaders they will soon be hearing more about Virginia’s Talent Accelerator Program, which delivers direct recruitment and training services that are fully customized to a company.
She said the program is run out of the Virginia Economic Development Partnership, whose team will visit the area sometime next year.
Rachael Smith covers local businesses and nonprofits. Reach her at (434) 385-5482.