Area’s Economic Expansion Expected To Continue

February 22, 2019
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Area’s Economic Expansion Expected To Continue

PLAINS TWP. — Eric Taylor, director of investment planning and portfolio implementation for Wilmington Trust, delivered good news to local business leaders Thursday — economic expansion is expected to continue.

Taylor told about 50 business leaders who attended the Greater Wilkes-Barre Chamber of Commerce’s capital markets forecast breakfast he expects the U.S. GDP growth rate will be about 2.25 percent this year which he said is “a far cry from recession.”

“The U.S. economy continues to be strong,” Taylor said. “It’s slowing from the growth that we saw in 2018 but we’re not predicting a recession in the near term in 2019.”

Among the improvements in the economy Taylor highlighted, a new tax law has lowered tax rates. The stock market has seen a huge rebound from December lows and he said he believes stocks are still a good investment. The unemployment rate in the Scranton/Wilkes-Barre/Hazleton area has dropped to 5.1 percent while the national unemployment rate is at 4 percent. Taylor expects the unemployment rate will remain low.

“We’re seeing more people come back into the workforce which is a good sign,” he said.

As the unemployment rate has dropped, Taylor said the demand for workers with the right skill sets has increased. The tight labor market could lead to more wage growth, he said.

“We have fewer and fewer workers. They’re becoming more productive,” he said. “It just seems you’re setting up for an environment where workers will have more power and more opportunities. If people want workers and they can’t get them, they’re going to be willing to pay more to lure them away so it naturally sets up for an environment where there is going to be wage growth.”

Wico van Genderen, president and CEO of the Greater Wilkes-Barre Chamber of Commerce, said the area has experienced benefits from economic growth as businesses have been opening here and creating thousands of jobs.

“We have literally 4 million square feet of business space coming within the next 24 to 36 months and that’s going to bring potentially another 3,000 jobs on top of the 2,500 jobs that we’ve already brought in here,” van Genderen said following Taylor’s presentation.

He cited Missouri-based NorthPoint Development as one of the developers who is bringing in jobs with the construction of warehouses for Chewy, Adidas and Patagonia in Hanover Twp. as well as three more large warehouses in development called “Hanover 9” near Luzerne County Community College in Nanticoke.

Brent Miles, vice president of economic development for NorthPoint Development, said an e-commerce company would occupy one of the three warehouses but he did not identify the business.

The warehouses are opening as a digital revolution called the “Fourth Industrial Revolution” has been occurring and Taylor said it is transforming the face of industry.

He said the growth in technology is a double-edged sword that dictates who wins and who becomes obsolete. Companies like Netflix, Apple and Amazon are in while Blockbuster, Kodak, Toys R Us, Sears and Kmart are out, he said.

As a result of the digital revolution, Taylor said companies are engaged in a “technological arms race” and nearly ever sector is making sizable increases in tech-related budgets.

Locally, van Genderen said health care is still the predominant business and employer in the area but e-commerce companies are bringing in thousands of jobs.

“A lot of folks are asking, ‘Are those the jobs you want?’ And the answer to that is, ‘Yeah they are.’ If you look at them, they bring benefits into the area and the wages are going up in the area because of that,” he said. “I think that all has positive impact on the local economy.”

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