Art + science = economic forecasting
RESI staffers play key role in state budget planning
Three times per year, a pair of TU-based research economists blends hunches with hard data to create an important tool for Maryland budget planners.
The RESI Maryland Economic Forecast, published each February, August and November under contract with the Maryland Office of the Comptroller, provides a treasure-trove of information, including region-by-region snapshots of labor and housing markets, major employment sectors, personal-income trends and the impact of federal policies and spending.
“Economics is an art as well as a science,” says John Hopkins, associate director of RESI’s Applied Economics Unit. Working out of leased space across York Road from the campus, Hopkins and colleague Dana Hawkins gather the economic indicators—tangible and intangible—with which to craft periodic outlooks that help state officials assess Maryland’s economic health.
The comptroller’s office uses RESI’s forecast, plus some other points of view, to arrive at an average economic outlook. That knowledge, in turn, is used to project tax revenues and to drive state policy.
“We analyze data from a variety of sources,” Hopkins says, “including the Maryland Department of Labor, Licensing and Regulation, the U.S. Census Bureau and the U.S. Department of Labor Statistics.”
But numbers aren’t the entire story. Hopkins says economists also rely on intuition when developing forecasts.
“That’s the ‘art’ part,” he says.
Hopkins’ and Hawkins’ most recent edition of the RESI Maryland Economic Forecast paints a fairly rosy picture for the state. Maryland’s economic expansion continues to outpace the nation’s, with unemployment down from the same period a year earlier. And while the home-sales market will slow this year, the volume of sales is expected to remain high, while jobs and personal income rise.
“Maryland is experiencing strong job growth as a result of federal spending,” Hopkins says. “The state’s well-educated work force also attracts emerging industries—biotech and informatics, for example—that need the highly qualified employees produced by Maryland universities.”
Hopkins says he also sends the forecast to other organizations, based on their interests. “We’d like to see it reach a wider audience,” he says.
In addition to his work on the RESI Maryland Economic Forecast, Hopkins also raises RESI’s visibility by serving as a resource for area business reporters and writing a monthly column for The Daily Digest.
“I get several calls a month,” he says, “mostly from The Sun, Daily Digest, and Capital News Service.”
Story by Jan Lucas/Photo by Kanji Takeno
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