By Emma Delk, The Intelligencer
WHEELING, W.Va. – As 38 counties in West Virginia see decreases in average annual employment growth, West Virginia University economist John Deskins cites expanding the state’s manufacturing industry as one way to “spark” economic development in these counties.
Deskins serves as the assistant dean and director of the Bureau of Business and Economic Research within the College of Business and Economics at WVU. He presented this solution to the economic downturn in West Virginia counties as one of the featured speakers during the West Virginia Manufacturers Association’s Manufacturing & Energy Growth Summit, which was held at Oglebay’s Wilson Lodge.
Before discussing West Virginia’s current economic outlook, the economist zoomed out to put West Virginia in context with the nation’s economic outlook. Deskins first displayed a graph of U.S. inflation rates, noting that the summer of 2022 was the “highest they had ever been in 40 years” at 7.7%.
“We made great progress in our battle with inflation, but it turns out that this last stretch of fighting inflation is kind of proving the hardest,” said Deskins. “We want inflation to be at 2%, but right now, inflation is down to 3%.”
While inflation rates were in the last stretch of recovery from 2022, Deskins noted U.S. interest rates were in a “cycle of increases.”
The last time the Federal Reserve increased interest rates “almost as aggressively” was in the early 1980s, a phenomenon Deskins noted resulted in a severe recession. Though uncertainty loomed because of the interest rate increase, Deskins said things did not appear to be heading in the same direction.
“Things seem to be different this time as we’ve gotten inflation from 7.7% down to 3%, and so far, we’ve maintained a healthy economy,” he explained. “We’ve maintained a healthy economy, and we haven’t gone too far with interest rates to tip the economy into recession.”
Zooming in on West Virginia’s current economic outlook, Deskins noted that the state has “fully recovered” from the COVID-19 pandemic by adding 5,000 private sector jobs. This marks a 0.8% growth in jobs from before the pandemic.
The unemployment rate for the state is also heading in a positive direction, with Deskins adding the current West Virginia unemployment rate of about 4% “looks fantastic.” He noted the state reached a record low employment rate “about a year and a half ago” that has increased “slightly” since then.
West Virginia was in the “red” in terms of per capita personal income compared to other states, with an average annual salary of just over $50,000.
