The middle class, housing affordability and business innovation were among the recurring themes of the 12th annual Oregon Economic Forum last Thursday at the Portland Art Museum.
Tim Duy, University of Oregon professor of practice and director of the forum, opened the event by saying that after six years of recovery since the Great Recession the global economy has slowed, but the U.S. economy still has growth potential.
“I would like to see the U.S economy slow down and transition to a more sustainable, long-term path. The recovery still has two to three years left before I would worry about a recession,” Duy said. “Oregon’s economy is following the nation. We have in-migration, which is good news, but it’s starting to cause some stress in our communities, especially in housing. One thing that could slow Oregon’s economy is an inability to accommodate a faster growth.”
While the economy has rebounded in many ways since the downturn in 2008-09, many people continue to feel insecure about the recovery.
“We are now six years into this recovery, but for most of the middle class it still doesn’t feel like it’s kicked in,” said Jim Tankersley, economic policy correspondent with the Washington Post and the keynote speaker for the event. “The economy is not working — at least not in the way Americans think it should — for the middle class. Average household income is lower than it was before the recession and is equal to what it was in 1989.”
But the Great Recession only intensified a trend already in the works.
“Good middle-class jobs have been vanishing for a quarter century and being replaced with lower-paying ones” Tankersly said. “Even before the Great Recession, the 2000s were on pace to be the worst decade on record for job creation.
“These were jobs that could easily be outsourced overseas or replaced by a machine. When middle-skill jobs vanish, workers have to take lower-wage jobs or compete for the remaining middle-skill jobs and that pushes wages down. Now people work more for less.”
A panel discussion on Oregon’s economy focused on jobs and housing.
“As much as it’s changed over the last 20 to 30 years, we are still manufacturing and making things in Oregon,” said Mark McMullen, state economist with Oregon Office of Economic Analysis. “We had 90,000 forest jobs and now we have 90,000 tech jobs. We lost all these timber jobs in rural communities and they were replaced with lower-level jobs.”
But Oregon, and specifically the Portland metro area, continues to be a value when compared to West Coast cities like San Francisco and Seattle, drawing people who want the livability of the Pacific Northwest. But that influx is displacing a portion of the population.
“It’s a tough balancing act,” said Tom Potiowsky, department of economic chair at Portland State University and director of Northwest Economic Research Center. “Our Metro and land use is an envy of other places. We don’t have sprawl, but our housing cost is up because of the growth boundary.
“How do you have affordable housing? How do you keep your work force in the city? You don’t want a doughnut effect of people living out of Portland. That creates more problems, like a strain on the transportation system.”
One of the trends Tankersley noted is the decrease in startups, partly because of the lobbying power of big companies. Local and regional communities should continue to incubate new business, which could bring jobs and growth to the economy.
“The startup rate has been declining for 30 years,” he said. “This is a real problem for the economy, because young companies employ a lot of people and bring innovation to the market.”
—By Heidi Hiaasen, Public Affairs Communications