Five Essential Trends That Shaped NH's Economy In 2011
With Christmas and Hanukkah wrapped-up, we've officially reached the pre-New Year's lull. This brief respite from the regularly scheduled holiday cheer is when many people take the opportunity to consider their accomplishments and failures over the past year, and resolve to do better in the future. Other people just go to work for a few days and get really, really bored at their desks as they countdown to their next party.
Either way, it's a bit of a restless period, isn't it?
So here at StateImpact, we've decided to combat this inter-holiday malaise with a list. We've been watching a lot of economic forecast presentations lately, and reading a lot of white papers. So we took that information, along with some of our previous coverage, tossed it into the metaphorical pot, and boiled it down into a quick list of five essential trends that shaped the Granite State's economy over the past year. While it's certainly not exhaustive, it provides some food for thought looking toward 2012.
And, as always, whether you think we're absolutely right, dead wrong, or just have a question, we invite you to come on over and crash our comments thread.
$700 million. By June, that number had narrowed dramatically, and the Legislature ultimately passed a budget with $467.6 million in cuts to the general fund. One of the immediate consequences of the revenue shortfall and lower budget was a much leaner government–which translated to heavy public sector job losses. As economist Dennis Delay with the New Hampshire Center for Public Policy Studies noted at the Legislature's Joint Economic Session earlier this month, at the height of the recession, when the private sector lost about 5 percent of its jobs, the government added four percent to its workforce. "It acted as a cushion for the losses we were seeing in the private sector," Delay said. "That has been reversed. The public sector is now acting as a drag. It's slowing overall growth in the economy." From June through September of this year, Delay found that while private sector jobs grew by 1.4 percent, public sector jobs declined by 1.2 percent.
nationally–it's still a significant problem for the state. Economist Russ Thibeault noted at the Legislature's Joint Economic Session that while foreclosures are down from their 2010 peak of 3,953...at 3,650 in 2011, they're not down by much. This year's figure is also higher than the period from 2007–2009. Meanwhile, in the fall we reported on a paper released by the Boston Fed, which noted the New Hampshire foreclosure mediation program–designed to keep homeowners in their homes by working with the court system–was lackluster, at best. (You can read that post here.) According to the Fed paper, one major problem with the state's program was that it gave lenders virtually all the power to determine who was, and wasn't, eligible for mediation. Another was that the state didn't offer banks any incentive to work with homeowners on alternatives to foreclosure. The New Hampshire Center for Public Policy Studies found that in about two years, the program looked at roughly 100 cases. And by July of 2011, only 14 of those had been settled. By the end of October, the program was all but shut down, with only pending cases continuing the review process.
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