|Perryman paints rosy economic picture for Texas|
|Bruce Alsobrook | News-Telegram Editor|
Dec. 7, 2006 - A leading economist said Wednesday that Northeast Texas and Hopkins County can’t expect to grow as fast as the urban centers of the state, but economic expansion is still going to come at a faster pace than the rest of the U.S.
When the nation began coming out of an economic slowdown following the attacks of 9/11, Texas started its economic recovery a little later than other states, Ray Perryman told a crowd of about 300 people at an economic conference in Sulphur Springs.
�But when we came back, we came back with a vengeance,� said Perryman. �We�ve seen back-to-back growth for something like 39 months now.�
Texas’ economy is growing at about 4.2 percent per year, compared to a national rate of about 3.6 percent. He said the state will continue to outpace the rest of the nation in growth, and Hopkins County and the Northeast Texas region could especially benefit because of an extensive agriculture industry.
�What we do better than anybody else is �the next big thing,�� Perryman said. �And agriculture is the ultimate high-tech industry.�
He explained that agriculture production can benefit greatly from automation and technology advancements that reduce production costs. The textile industry, for example, has been lost to foreign economies that will pay workers 75 cents an hour.
�But we will figure out a way to use robotics to get it back,� Perryman said.
There are three basic factors that will determine how well an economy will do in the future, he said: Investment and risk-taking, opening up world markets, and the quality of its workforce.
Texas scores highest in the nation in two of those categories and has the potential to be the best in the third.
First, he said, Texas has the best investment climate in the country. He said since the Texas Enterprise Fund was established in 2003, the state has gone from 37th in the nation in investment climate to No. 1 , adding that State Rep. Mark Homer played an important role in pushing that legislation through.
�We are the number one exporting state in the nation,� he said. And while most exports go to Mexico and Canada, as is the case with the other states, the countries that follow show a clear trend of Texas businesses trading with Asia: China, Japan, Taiwan, Singapore, South Korea.
�That was not the case five years ago,� Perryman said.
The final piece to economic growth is one the state needs to work on — an educated, well-prepared workforce.
But Texas has a growing young workforce, he said, the largest in the nation, and that’s become an important factor over the past 20 years with the aging of the Baby Boomer population.
�In the 1980s, every state had a strong workforce,� he said. �That�s not the case today. You can�t give enough incentives to a company [to relocate] if you don�t have enough workers.�
Perryman also said ‘resiliency” is the hallmark of the U.S. economy, noting that the nation began pulling out of a recession in the quarter following the attacks of 9/11, and has grown every quarter since then. When Hurricanes Katrina and Rita put 600,000 people out of work, the nation’s labor market was down only 50,000 jobs the following month. The next month, it was up 130,000 jobs.
�Our system is strong,� Perryman said. �We are able to bounce back very quickly.�
In the near future, he said, there will be slowdowns. Too many homes have been built in Texas, which means supply is a little ahead of demand in that market.
�We�re going to see a garden variety dropoff in housing starts for a couple of years, then it�s going to pick back up,� he said.
Energy prices will continue to remain somewhat high due to instability in oil-producing regions of the world, and don’t be surprised to see a little more inflation than normal next year.
At the same time, “I think we’ll see interest rates come down a couple of times next year,” he said.
Perryman fielded several questions from the audience after his presentation, including one seeking his opinion on the economic impact of illegal immigrants.
While acknowledging there were social costs, he indicated that illegal immigrants have been assimilated into the nation’s labor structure and put more value into the economy than they take away.
Perryman said there currently aren’t enough legal citizens to take over the jobs held by illegals. He said there are about 11 million illegal immigrants working in this country, and the number of unemployed Americans only totals about 9 million.
�In the last 30 to 40 years, this workforce has been built into our economy � we just don�t talk about it,� he said. �We need to create a system where we bring it out in the ope
Perryman says the economic benefit of the illegal immigrant workforce versus cost comes out at about a 15:1 ratio.
�It might be 13 to 1, it might be 17 to 1,� he said. �But even if it�s just 2 to 1, it�s something we need to preserve.�
He also said the nation needs to beef up its security at the border, but building a wall isn’t the answer.
�We don�t need a fence � that�s the silliest thing I�ve ever heard,� he said.
�Besides, who�s going to build it?� he quipped, bringing the loudest laugh of the afternoon from the crowd.