The 2018 Economy
Senior Vice President, Research & Strategic Planning
Much has been written about and panel discussions and presentations have been devoted to what lies ahead for the economy in 2018. Any predictions are rooted in what happened over the last few years and what changes can potentially be expected on local, national and international levels, including policies related to taxes, immigration and regulatory measures. Looking beyond one year is much more difficult, but there are data sets that allow for some forecasting and it can be illuminating to see what past data tells us about the future.
As researchers, we are always carefully with forecasting and we put plenty of disclaimers in our statements. And I will do the same. The forecasts in the tables below are based on past trends. Any change in the world around us could make the data incorrect. That is why when I do presentations I tell the attendees that these kind of data sets are a starting point to understand what might happen in the years to come. But knowing the local economy, in our case Miami-Dade County, and what specific developments and activities are taking place, will put the information in a more credible perspective.
One of the frequent questions we receive is about population and what we can expect with population growth. This information is valuable for almost all sectors of an economy. It also is a more reliable data set to forecast. In most cases, changes in population take place over a longer period of time. In the case of Miami-Dade County, the population is expected to continue to grow over the next five years, from the current 2.72 million to 2.87 million in 2022. South Florida as a region will have more than 6.5 million people by 2022.
Table 1: Population Forecast, 2017-2022
|Region||Population 2017||Population 2022|
|Palm Beach County||1,447,457||1,577,484|
Source: Powering Florida, 2018
Predicting how certain sectors will do over a longer period is not as easy as looking at demographic data. Any kind of changes can impact an economy immediately. Here too, it is important to know what influences the growth or decline in a sector. The data below show that almost all sectors show healthy growth over the next five years.
Table 2: Percentage Job Growth or Decline for Major Sectors, 2018-2023.
|Description||Florida 2018 – 2023|
|South Florida 2018 – 2023|
|Miami-Dade County 2018 – 2023|
|Agriculture, Forestry, Fishing and Hunting||(2%)||2%||2%|
|Mining, Quarrying, and Oil and Gas Extraction||8%||11%||9%|
|Transportation and Warehousing||6%||6%||5%|
|Finance and Insurance||5%||2%||5%|
|Real Estate and Rental and Leasing||5%||6%||8%|
|Professional, Scientific, and Technical Services||8%||7%||7%|
|Management of Companies and Enterprises||6%||6%||2%|
|Administrative, Support, Waste Management, Remediation Services||5%||7%||5%|
|Health Care and Social Assistance||11%||10%||9%|
|Arts, Entertainment, and Recreation||7%||5%||7%|
|Accommodation and Food Services||8%||7%||9%|
|Other Services (except Public Administration)||6%||5%||4%|
Source: EMSI, 2018
For instance, in the case of manufacturing in Miami-Dade County, the data shows that there will be a two percent decline in the number of jobs over the next five years. But from our activities, we see manufacturing companies looking at either expanding or locating in Miami-Dade County. What has changes over the years, is that the number of jobs created is not as large as in the past due to more automation. It also means that the jobs created require more skills and are higher paid. In recent years, the Miami-Dade Beacon Council has assisted TUUCI, a manufacturer of commercial umbrellas,
When looking at the target industries for Miami-Dade County, using the same data set, all seven target industries will also see growth in the next 5 years. Life Science & Healthcare (10%), Technology (9%), and Hospitality & Tourism (9%) have the highest growth rates followed by Aviation, Banking & Finance and Trade & Logistics. In addition, most of these industries have annual wages higher than the average for Miami-Dade County, with Banking & Finance having the highest annual average wage ($129,835).
Table 3: Percentage Growth Target Industries in Miami-Dade County, 2018-2023
|Industry||Percentage Change||Average Annual Wage|
|Banking & Finance||5%||$129,835|
|Hospitality & Tourism||9%||$34,673|
|Life Science & Healthcare||10%||$65,812|
|Trade & Logistics||5%||$56,074|
Source: EMSI, 2018
An example where the data show a slow growth is the Creative Design industry. But over the last few years, there have been many developments that will have the potential for that sector to grow faster. For instance, Miami Dade College just saw its first class of students graduate from the Miami Animation and Gaming International Complex (MAGIC). This state-of-the-art program will make it easier for companies in this field to grow in Miami. VIACOM recently completed its facilities for original productions and Miami-Dade County created its film incentive program. In Technology, which shows a nine percent growth, we have seen major changes in the local ecosystem, startup companies receiving multiple rounds of funding, and education institutions increasing their programs.
While I am not trying to predict the future, data can help companies better understand what to expect. It helps to think through opportunities. For companies interested in expanding or locating in a region, accessing organizations for more localized knowledge is imperative.