The Economic and Revenue Forecast Council’s April 11 update shows collections coming in very slightly below projections.
Major General Fund-State revenue collections for the March 11 – April 10, 2017 collection period came in $7.9 million (0.6%) below the March forecast. Revenue Act receipts were $12.9 million (1.2%) lower than forecasted and all other receipts were $5.0 million (3.0%) higher than forecasted.
That doesn’t strike us as being a very big deal, but it is a departure from what seems like a remarkably long string of collections reports showing a positive variance from the official forecasts.
ERFC reports the economy remains strong overall.
Total nonfarm payroll employment rose 21,300 (seasonally adjusted) in November, Decem- ber, January, and February, which represents a solid 2.0% annual rate of growth. This was down from a very strong 3.5% average growth rate during the previous year, though. Man- ufacturing lost only 300 jobs in the four-month period as the loss of 2,300 aerospace jobs was mostly offset by increases elsewhere. Construction employment increased 4,500 in the four-month period and government payrolls expanded by 2,800 jobs. Private, service- providing sectors added 14,200 jobs in November, December, January, and February.
In March, after the forecast was complete, the U.S. Department of Commerce, Bureau of Economic Analysis (BEA) released preliminary annual personal income estimates for 2016. The 4.8% growth rate in Washington personal income was the fourth largest among the states and District of Columbia and was significantly higher than the 3.6% growth rate for the U.S. as a whole. The 1.2 percentage point differential between Washington personal income growth and U.S. personal income growth was almost entirely due to two sectors: information (which includes software publishing) and retail trade (which includes electronic shopping). Between the two of them, these sectors contributed 1.0 percentage points more to Washington personal income growth than to U.S. personal income growth.
Here’s the way ERFC summarizes the report:
U.S. labor markets added only 98,000 net new jobs in March, although data issues may account for the lower-than-expected increase.
Stronger consumer confidence reflects greater optimism about the economy.
U.S. auto and light truck sales fell below 17 million units (SAAR) for the first time in a year.
Washington personal income growth significantly outperformed U.S. personal income growth in 2016.
Seattle area consumer price inflation is above the national average due to higher shelter cost inflation.
Major General Fund-State revenue collections for the March 11 – April 10, 2017 collection period came in $7.9 million (0.6%) below the March forecast.
Revenue Act receipts were $12.9 million (1.2%) lower than forecasted and all other receipts were $5.0 million (3.0%) higher than forecasted.
Worth watching. And worth reading the report.