The Lee County Economic Development Office invited the senior economist for Wells Fargo, Mark Vitner, to speak Friday at the Harborside Event Center in Fort Myers. Vitner will discuss “Global Economic Turmoil and Southwest Florida.” WGCU’s Jessica Meszaros spoke with Vitner about his upcoming presentation.
What do you mean by global economic turmoil?
"Really, what we're talking about is the global economy seems to be slowing, particularly, China and the emerging markets. And it is having an impact on our economy. And I’m afraid that that’s something we're gonna be dealing with for quite some time."
How does that affect Southwest Florida?
"Well, there's a number of ways that it impacts us. For one, the dollar has strengthened and that makes it a little more expensive for foreign travelers to visit the state. And once they get here, they may be inclined to spend a little less. Canada sends a lot of visitors our way. And the Canadian dollar has weakened relative to the U.S. dollar because they are a commodity-based economy. They sell a lot of commodities to China. And with China's economy weakening, they're selling them less commodities, so their currency has weakened. So that means when Canadians come and visit, they may not spend as much as they have in years passed. But they're still likely to come."
And why is this a topic you want to discuss?
"Well, one of the things that's somewhat unique about Southwest Florida is that we have so many well-to-do retirees that we drive a much larger proportion of overall income growth from interest dividends and rents. And so the exposure to the stock market's a little bit greater in Southwest Florida than it is in the nation as a whole. It’s actually significantly greater in southwest Florida than the nation as a whole. So I think there will be a lot of interest as to the slowdown in China is impacting the financial markets."
What does Southwest Florida's economy look like right now?
"It looks pretty good. We’ve had very strong job growth, housing is coming back on line, tourism has been strong this past year. We believe it will be strong again as we go into the winter and the spring of 2016. I think we'll have another strong year. We’ve become less dependent upon seasonal visitors and tourists and retirees and we have more year-round residents and more home grown industries that are helping provide employment opportunities for folks."
And so the state right now has the lowest unemployment rate in seven years. Why do you think that is?
"Well, we've had a steady improvement over the last few years. We’re attracting more industry. I really think that the efforts that were made by state leaders over the last two decades to diversify the state's economy and to help bring in industries that really weren't there. The life sciences industry, for example, which is more important in South Florida and Central Florida-- a little bit in the Tampa area, as well. But it's an industry that didn't exist in Florida 20 years ago. We had universities but the universities were another population-driven industry that grew because Florida was growing. They didn't grow because they were centers of research. well, that's begun to change and we're seeing that there's a lot of growth and research activities at the University of Florida and Florida State and University of central Florida and Florida Atlantic University. I would expect to see that extend to all of the universities throughout the area."
Housing prices are now increasing in the state. Is there a concern that we're heading into another housing bubble?
"I'm not worried about another housing bubble. At least, not like the housing bubble that we dealt with previously, which was largely driven by speculators. But some of the pre-conditions that led to that bubble are still with us and it takes a long time for developers to bring land into production and when demand picks up, it's very hard for supply to react. And so we can see that prices jump up. What’s different today it's just not as easy for folks to speculate in housing as it was a decade ago."
And why is that?
"It's tougher for folks to get a mortgage. You had a lot of folks that were buying homes and getting mortgages with state of income that just didn't exist. And today you have to prove your income so it's much harder to qualify for a mortgage today if you're not working. If you're a full time house flipper, it's much tougher. You’re going to have to have more cash in order to do that."
What does the future of Southwest Florida’s economy look like?
"I think that we're going to see continued population growth that's driven by this influx of baby boomer retirees. I think that it's a great place to do business. The Southwest Florida International Airport gives businesses great access to key markets around the country. So it's a place that's not only a great place to live, but it's also relatively easy to conduct business. I think that we'll see more businesses choose to locate in the area with national headquarters, regional headquarters."
Mark Vitner will speak Friday, Aug. 28 at 8:30 am at the Harborside Event Center in Fort Myers.
