The 2012 economic forecast

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Articles - December 2011
Tuesday, November 15, 2011
Dennie Houle, a business development officer working on the northern Oregon Coast for Business Oregon, says the smaller coastal towns have their own struggles, but promising opportunities have begun to sprout. A stronger fishing industry in Alaska and across the Pacific has recently helped spark the coast’s ship repair business. Portland General Electric has proposed a new natural-gas-fired generation plant in Clatskanie, and the Port of Newport is in the middle of a $10 million project that will add a new commercial fishing dock and a log crane to help load logs being exported from Oregon.

“In some ways, folks are cautiously thinking that the corner maybe has been turned,” Houle says. “I think they see some growth in the next year.”

In Southern Oregon, Holzgang sees a similar outlook and scene. Although Panel Products, a Milwaukie plywood company, closed its Rogue River mill in 2009, Eugene-based Murphy Co. bought it in early 2010 and has since reopened it. It now employs more than 100. Radio Design Group, a small radio frequency products company, also broke ground on a new headquarters and manufacturing center in Grants Pass in April. When completed, the new building will accommodate Radio Design’s plans for growth, including 15 new employees.

“There are little pockets of bright spots where people are having some luck,” Houle says. “I think that we’ll continue to find those as we move into the new year.”

Other companies, he adds, may not be hiring or doing as well as they once did, but they’ve continued to invest in equipment and facilities so that they’re ready to go if and when the tide does finally turn.

One other factor that could also impact the business and economic climate in Oregon in 2012 is the Legislature. Revenue for the biennium was forecasted at $13.9 billion in September and was expected to remain flat or just slightly lower at the next forecast in November. Beyond that, however, Deckert says a few major votes could have long-term impacts.

The first concerns Oregon’s efforts at health-care transformation and would approve the creation of Coordinated Care Organizations to serve the state’s Medicaid population. The CCOs could alter how health care is delivered in Oregon and potentially save a decent sum of cash. The Legislature is also expected to review and potentially approve the business plan for the state’s health insurance exchange [see Diagnosis Unknown], which might also play a role in curbing health-care costs long-term. Deckert says the Legislature also will likely consider proposals and legislation brought by the Oregon Education Investment Board. Established last spring, the OEIB is charged with creating a new governance system for investing in and delivering public education, which will ultimately have impacts on businesses and the economy here as well.

“Some state in this country is going to have to show that you can govern effectively and still take on tough issues that can have a huge impact on the economy and on businesses,” Deckert says. “We think Oregon can be the state that does that.”

Jon Bell is a Portland-based journalist. His last story was on Mount Hood. He can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

 



 

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