Sponsored by Lane Powell

Weak dollar a mixed blessing

| Print |  Email
Friday, February 01, 2008

t_dollar sign 0980

STATEWIDE There’s a basic rule of thumb when it comes to U.S. industries and a weak dollar: Exporters benefit (their goods are cheaper for other countries to buy), and importers suffer (they pay more for foreign goods).

For Oregon, where exports grew 24% between 2005 and 2006 to $15.3 billion, that should be a good thing. But it’s not that simple. Nor is it a simple question whether the weak dollar — down nearly 11% over 2007 and predicted to drop even further this year — is helping or hurting Oregon.

pdf

e-sources

Oregon's top 25 export industries by dollar amount, 2000-2005

• Oregon's top 25 export partners, 2000-2005, with ranking by percentage of total exports


• Oregon Economic and Community Development Department's analysis of Oregon's foreign exports between 2005 and 2006

Some of the state’s top export industries are riding high. Agriculture products, which make up 10% of the state’s exports, are doing extremely well, says Department of Agriculture spokesperson Bruce Pokarney. “We ship about 40% to the international market. It’s very significant,” he says. The metals and software industries are also strong, according to anecdotal accounts by industry groups.

But exports by the computer and electronic product industries — 40% of the state’s exports — are flat, says state economist Tom Potiowsky. Forest products and transportation manufacturing exporters aren’t benefiting either.

One reason is that no company only imports or exports; the ratio between the two could hurt even the largest exporter. Further complicating the question, says Randall Pozdena — senior economist at ECONorthwest and former vice president of the Federal Reserve Bank of San Francisco — are things such as industry regulations that limit quick response to market conditions, or China’s growth and its impact on manufacturing around the world.

So what does the weak dollar mean for Oregon? There are myriad economic forces and factors at play, making it nearly impossible to say what the weak currency will do.

Pozdena offers one possibility: When the traded-goods sector booms, it pulls resources, like employees, from the non-traded sectors with potentially broad impacts across industries, like job loss. “If you happen to live in an economic community that’s heavily construction-oriented, the sucking sound will be even stronger,” he says.

Potiowsky maintains that, as a whole, the weak dollar isn’t a bad thing. It’s a result of the dollar correcting itself after being at high levels for a long time, he says. “And without us having to do anything, it’s almost like having a productivity gain.”

ABRAHAM HYATT



Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

More Articles

On the Brink

March 2015
Friday, February 20, 2015
BY APRIL STREETER | OB CONTRIBUTOR

Leslie Carlson channels the big idea.


Read more...

Thy neighbor's house

March 2015
Friday, February 20, 2015
BY LINDA BAKER | OB EDITOR

Vacasa may lack the name recognition of Airbnb. But not for long.


Read more...

All Rise

March 2015
Friday, February 20, 2015
BY AMY MILSHTEIN | OB CONTRIBUTOR

Don’t just sit there. For a healthy workplace, move up and down — and all around.


Read more...

Closing the Gap: The two Oregons and the way forward

February 2015
Monday, January 26, 2015
BY JOE CORTRIGHT

"Nostalgia is not an economic strategy."


Read more...

5 companies react to lower fuel prices

The Latest
Thursday, January 15, 2015
thumb-shutterstock 233787049BY JACOB PALMER | OB DIGITAL NEWS EDITOR

Consumers love the savings they get from low oil prices, but how has business been affected?


Read more...

Tweeting Portland's State of the City address

News
Friday, January 30, 2015
Screen Shot 2015-01-30 at 3.08.19 PMBY JACOB PALMER | OB DIGITAL NEWS EDITOR

For those who were working, here are a few highlights of Charlie Hales' State of the City address.


Read more...

10 Twitter highlights from #OR100Best

The Latest
Friday, February 27, 2015
100bestBY OB STAFF

Oregon Business held its  22nd annual 100 Best Companies to Work For in Oregon celebration Thursday night in the Oregon Convention Center.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS