What to expect from Florida’s economy in 2022
ST. PETERSBURG, Fla. - The pace of inflation and job growth caught a lot of economists by surprise this year. But UCF economist Dr. Sean Snaith has accurately projected the trends in Florida through the pandemic.
He’s one of Florida’s leading and best-known economists, and he recently shared his expectations for Florida’s economy in the coming year with FOX 13's Craig Patrick.
Addressing the rapid price increases along the I-4 corridor, Dr. Snaith ties it to a shortage of available homes – made worse by disruptions in the supply chain – but he expects the pace of rising prices to slow down.
"The ability to get raw materials or appliances is slowing down progress on new construction, and inventories are at record lows right now, and so that's been feeding this rapid price appreciation that we've seen for the past several years," he explained. "But the affordability issue – when you see prices rising 10, 15, 18 percent year-over-year – is going to start to dampen demand. So I would expect price appreciation to level out a little bit, at least dropped down from these double-digit levels as we move through 2022."
Dr. Snaith’s economic forecast also calls for growing inflation at least until summer.
"I think that the first half of 2022, consumers are still going to be releasing this pent-up demand that we've seen driving the economy since the second half of 2020. Six months into 2022, the pent-up demand from the consumer should have eased and we should be back to a more normal situation. Unfortunately, it will take at least another six months beyond that for the supply chain to catch up."
In Florida’s job market, Snaith projects we will fully recover the number of jobs we had before the pandemic. But he said it will take most of 2022 to get there.
Snaith: "I think turnover is going to continue to be a persistent problem because the labor market is so incredibly tight."
Craig: "What do you expect the unemployment rate to be through the course of 2022 across the I-4 corridor?"
Snaith: "In the three percent range, give or take a couple of tenths of a percentage point."
Craig: "What do you see in terms of growth of wages? Will it keep up with inflation?"
Snaith: "I think that wages are growing pretty rapidly right now. Part of that again is driven by the shortage of workers. Internationally, we're still three million fewer people in the labor market than was the case pre-pandemic. So, you know, a lot of help-wanted signs out there. And you know, part of the solution to getting employees has been for businesses to offer higher wages and salaries. Unfortunately, that feeds into the inflation that we're currently experiencing."
Dr. Snaith projects the domestic leisure and travel industry will fully recover through 2022. But business travel and international travel will continue to lag due to the pandemic and overseas restrictions and uncertainty over the omicron variant.