We're close to Great Depression, expert says
University of Florida economics professor David Denslow began his presentation to a collection of policy committees in the Florida House today with a word of encouragement. "Florida is going to be just fine,'' he said. Then he hit them with the trend lines, the numbers and the bottom line:
“I think this is going to be really, really bad,'' Denslow said. "We’re not talking about the Great Depression. We’re talking about something reasonably close to it. ... We’ve got to be ready for it.”
"We’re going through a structural change,'' he explained. With adjectives like "brutal," "phenomenal" and "this gets rough," the normally placid Denslow described how construction is not going to be as important as it was. Population growth is not going to be the economic driver Florida has become used to. The financial sector is going to shrink. Government employment will continue to decline. Manufacturing in Florida will continue to decline and be a smaller share of the workforce. Home ownership will continue to drop.
Nationally, the net debt to present value is $52 trillion. By contrast, the net worth of all Americans is now 41 trillion.
This structural change will result in unprecedented trends, he said. For instance, for the first time there has been a decline in electrical hookups in Florida since the Bureau of Economic and Business Research has been counting -- "a really phenomenal thing for a rapidly growing thing like Florida,'' he said.
School enrollment is plateauing in Florida, unlike in any other Southeastern state, and Denslow predicts three additional years of low population growth.
"The rewards will go to those with really good job skills ... greater skill and creativity,'' he said.