Home Back Issues February 2008 Weak dollar a mixed blessing

Weak dollar a mixed blessing

| Print |  Email
Archives - February 2008
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

October surprise

News
Sunday, October 12, 2014
roundup-logo-thumb-14BY LINDA BAKER

Cylvia Hayes, tabloid vs. watchdog journalism and the looming threat of a Cascadia earthquake.


Read more...

Fork & Bottle

October 2014
Thursday, September 25, 2014

National media can’t get enough of Oregon’s pinot noir, artisan-food purveyors and lively, independent film scene.


Read more...

Constant Contact

October 2014
Thursday, September 25, 2014
BY AMY MILSHTEIN

To prevent burnout, companies are banning email and after-hours communications. But is the 24-hour workday here to stay?


Read more...

Two Sides of the Coin

Contributed Blogs
Wednesday, October 22, 2014
22 twosidesBY JASON NORRIS

Historically, when the leaves fall, so do the markets. This year, earnings, Europe, energy and Ebola have in common? Beyond alliteration, they are four factors that the investors are pointing to for this year’s seasonal volatility.


Read more...

What I'm Reading

October 2014
Thursday, September 25, 2014

Nick Herinckx, CEO of Obility, and Jake Weatherly, CEO of SheerID, share what they've been reading.


Read more...

Downtime

October 2014
Thursday, September 25, 2014
BY JESSICA RIDGWAY

I'm not very interesting,” says a modest Ray Di Carlo, CEO and executive producer of Bent Image Labs, an animation and visual effects studio.


Read more...

A Recipe for Success

October 2014
Thursday, September 25, 2014
BY LINDA BAKER

Two businesswomen, two iconic food brands and one food-obsessed city. We thought this sounded like a recipe for good conversation. So in late August, Oregon Business sat down with Wendy Collie, CEO of New Seasons Market, and Kim Malek, owner of Salt & Straw, to discuss their rapidly expanding businesses and Oregon’s trendsetting food scene.


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