ORLANDO, Fla. (April 11, 2024) – The year is off to a solid start, and Florida’s “jumbo jet economy” is expected to cruise higher than the U.S. economy, says University of Central Florida economist Sean Snaith.
“Florida is going to keep cruising at a higher altitude than the rest of the country,” said Snaith, whose latest Florida forecast is out this morning. “That’s because the ‘twin engines’ of a robust labor market and population growth are propelling us forward.”
Unlike the fraught airline industry, Snaith says Florida is in much better shape—with current GDP and job growth that are expected to remain faster than the national economy through 2027.
But he cautions that there could be “some turbulence and a potential storm cloud” due to record levels of consumer credit card debt at an average 21% interest rate. This debt was accumulated as the cost of living outpaced the growth in wages for more than two years, Snaith explains. “This unfortunately puts the consumer sector, which we are already forecasting to see declining spending growth, in a position that is susceptible to a financial shock.”
In the meantime, Snaith says, “Florida should enjoy the ride through these economically friendly skies with seatbelts fastened—just in case.”
Other highlights from Snaith’s four-year quarterly Florida forecast include:
- Housing may not be as large of a driver in the economy for the next few years. Housing starts have felt the bitter chill of higher mortgage rates. Total starts were 193,500 in 2022—before higher mortgage rates and worries of a slowing economy started a deceleration that will slow starts to 157,072 in 2027.
- In 2024, the effects of a slowing economy will eventually impact job growth. Payroll job growth in Florida will begin to gradually decelerate as the economy remains at full employment. After year-over-year growth of 5.7% in 2022, payroll employment in 2023 was 3.4% but will slow to 2% in 2024 and drift lower to 0.6% by 2027.
- From 2024-27, Florida’s economy, as measured by Real Gross State Product, will expand at an average annual rate of 2.5%. Real Gross State Product will decelerate during the economic slowdown as growth will slow to 3.3% in 2024 and 2.2% in 2025, then accelerate to reach 2.5% in 2026 and ease to 2.1% in 2027.
- Real personal income growth will average 3.6% during 2024-27. Following an inflation-driven contraction in 2022, growth will be 3.3% in 2027. Florida’s average growth will be 0.8 percentage points higher than the national rate over the 2024-27 four-year span.
Sean Snaith, Ph.D., is the director of UCF’s Institute for Economic Forecasting and a nationally recognized economist in the field of economics, forecasting, analysis and market sizing. He has been recognized by Bloomberg News as one of the country’s most accurate economic forecasters and has served as a consultant for both local governments and multi-national corporations. Before joining UCF’s College of Business, Snaith held faculty positions at Pennsylvania State University, American University in Cairo, the University of North Dakota and the University of the Pacific. More of Snaith’s work is available at http://iec.ucf.edu or you can follow him @SeanSnaith.
