The latest update from the Economic and Revenue Forecast Council contains a little more good news for state budget writers.
Major General Fund-State (GF-S) revenue collections for the November 11 – December 10, 2020 collection period came in $62.4 million (2.0%) higher than forecasted in November. Revenue Act collections were $18.7 (1.2%) million higher than forecasted and all other tracked revenue came in $43.7 million (2.7%) higher than forecasted.
Employment growth in the state has slowed somewhat.
Employment continued to rise in November but at a slower rate than expected in the November forecast. Total nonfarm payroll employment rose 7,000 (seasonally adjusted) in November which was 16,300 less than expected in the November forecast. Private services-providing sectors added 4,300 jobs in the November. The manufacturing sector lost 500 jobs which was more than accounted for by the loss of 600 aerospace jobs. Construction employment increased by 300 and federal government employment increased by 500. State and local government payrolls increased by 2,400 jobs in November.
Washington’s unemployment rate held steady at 6.0% in November. While there was no improvement in November, the unemployment rate is down significantly from the 16.3% rate reached in April which was an all-time high in the series that dates back to 1976.
For all the economic upheaval, Washington is faring better than most states.
The BEA released estimates of real GDP for the 50 states and District of Columbia in October. Every jurisdiction suffered a sharp decline in real GDP from the business cycle peak in the fourth quarter of 2019 to the second quarter of 2020. The decline in Washington was 7.7% compared to 10.1% for the U.S. (see figure). Bad as the recession was in Washington, only one state (Utah) and the District of Columbia declined less. Unsurprisingly, the highly tourism-dependent states of Nevada and Hawaii suffered the largest declines.
Here’s the referenced figure.
The revenue recovery, of course, has been fueled by the massive federal pandemic stimulus programs. Congress is reportedly close to an agreement on another aid package.