For most employers, economic forecasts are extremely valuable to making informed business decisions. Here, Ken Louie, Ph.D., director of the Economic Research Institute of Erie (ERIE) and associate professor of economics at Penn State Behrend, shares a snapshot of what he’ll discuss at the MBA’s Economic Outlook IMPACT Luncheon on December 5 at the MBA Conference Center in Erie. The event is presented by the MBA, MBA Business Magazine, ERIE, KeyBank, Duncan Financial Group and Larese Floral.
The MBA has been fortunate to work with you and ERIE for some years on our annual Economic Outlook presentation. Tell us more about your background in forecasting and economics.
It has also been a pleasure for me to work with the MBA over the past decade. I began studying economics when I was a sophomore in college, earned a Ph.D. in the subject, and have been teaching at Penn State Behrend ever since. As director of ERIE, I oversee the Erie Leading Index (ELI), which is our primary forecasting tool. In addition to compiling ELI, which allows us to anticipate turning points in the local economy, we also pay close attention to the projections made by leading national forecasters.
This year, you will be joined by Brian Pietrangelo of KeyBank to share the economic forecast. What are some key areas and topics that you plan to discuss during your part of the presentation?
My presentation will focus on the performance of the Erie economy, analyzing historical as well as current economic trends and comparing local, state and national economic conditions. I also will highlight our local economic achievements as well as ongoing challenges as Erie adapts to the advances in technology, the gradual movement towards an information-based service economy, and the heightened degree of global competition.
2024 has been a challenging year for many individuals and businesses. How would you describe the state of the economy over the past year?
I would describe the economy as being stable and resilient. In 2023, the U.S. economy added over 2.5 million jobs, an average of over 200 thousand jobs added per month on a seasonally adjusted basis. Job growth has continued throughout the first nine months of 2024, although the pace of that growth has slowed to an average of 170 thousand jobs per month. In Erie, almost 150 jobs were added per month, on average, between January and September of this year, higher than the monthly average of 100 jobs added in 2023. Although the labor market has remained strong, many individuals and businesses continue to face challenges, especially since they have had to adjust to the lingering effects of the recent inflation.
You usually unveil the results of the Erie Leading Index (ELI) at the MBA’s Economic Outlook Luncheon. Will this be the case this year and why is the ELI so important?
Yes, we will be releasing the latest update to our Erie Leading Index (ELI). ELI is a useful gauge that allows us to anticipate the future trajectory of the Erie economy. ELI is a composite index that incorporates eight separate measures of economic activity at the national, state and local level. Since ELI can provide advance warning of an impending economic downturn, it can be a very useful planning tool for business leaders as they chart the future course of their organizations.
U.S. economic data continues to surprise us, revealing ongoing resilience despite looming uncertainties and persistent shocks. What economic opportunities and challenges do you see for 2025?
A major economic opportunity for 2025 and beyond is the continued upgrading of our national infrastructure, which will build even greater resilience into our economy. Although the Infrastructure Investment and Jobs Act (IIJA) was passed and signed into law in 2021, federal funding continues to be allocated to communities across the country. In addition to improving the nation’s infrastructure, this program will also create jobs along the way, making it an especially important opportunity for communities like Erie. Economic challenges for 2025 and beyond include the rapid pace of technological change, intensified global competition, and the economic impact of events related to the environment. All of these challenges will have a significant effect on economic performance and will therefore require carefully balanced policy decisions to ensure sustainable growth and prosperity.
Why do you believe business owners should plan to attend the December 5 Economic Outlook IMPACT Luncheon?
Achieving success as a business owner depends on recognizing and understanding the economic forces and trends that will have a major impact on the future course of the economy. By seeing the underlying trends in the economy and understanding what those trends signal for the future, business owners can make more informed and fact-based decisions that will contribute to the success of their organizations. Business owners can therefore benefit from seeing the economic analysis that we provide at the MBA’s annual Economic Outlook IMPACT Luncheon.
To register for this year’s Economic Outlook IMPACT Luncheon on December 5 at the MBA Conference Center in Erie, visit mbausa.org.
