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Financial Forecast | CU Denver Business School News
The transient nature of the economy can be frightening to some and incomprehensible to others. Fortunately, CU Denver Business School hosts an annual economic forecasting event where experts predict future trends and pain points to watch. This year, the Business School was joined by Ellen Zentner, ’95, chief U.S. economist and managing director at Morgan Stanley, and Kate Watkins, president and chief economist at Bright Fox Analytics and professor at CU Denver Business School.
Watkins took note of Colorado’s economic situation in particular. Colorado has a strong economy and, when compared to other states, generally performs best. However, it is starting to decline, mainly due to affordability. Colorado surpasses the nation in housing prices and is starting to take a toll on the local economy. Affordability issues have caused a slowdown in job growth and migration to Colorado. There was also a slowdown in the registration of new companies, resulting from decreased accessibility and increased commercial regulation; however, it is still heading in a positive direction. “We have seen some slowdown in new business growth, but it is still moving in a positive direction.” Hats off to a post-pandemic shift from consumption of goods to consumption of services, Watkins also reported that sales tax collections have stabilized.
“We have seen some slowdown in new business growth, but it is still moving in a positive direction.”
Kat Watkins
In his presentation, Zentner moves away from and focuses on the national economy, focusing primarily on the economic impacts of immigration. Immigration creates winners and losers in the global economy, and according to Zentner, the United States is a winner because immigration causes a positive supply-side shock and increases demand in the economy. The population increase that immigration brings also helps offset declining U.S. birth rates and contributes to labor force growth. Sustained immigration, however, requires a greater number of jobs to absorb the population flow, which has caused the unemployment rate to rise slightly. Zentner also predicted that the Federal Reserve would be confident of cutting interest rates by 1.5 to 3 times in July and that a hike would be unlikely.
The insights provided by Zentner and Watkins are invaluable. These brilliant forecasters predicted the many changes to come in the economy. Many young people are overwhelmed by the economy; With student loan debt being the second largest category of consumer debt, it’s easy to see why students might feel like the economy is unaffordable. However, Millennials and Gen Z are up to the challenge. 69% of the Millennial generation and 73% of generation Z reported taking their financial planning seriously before age 35, compared to just 49% of Baby Boomers. Events and workshops, like this economic forecast, demystify the economy and empower individuals with tools and skills to take control of their financial future.