The Tyler area is outperforming most of the state and nation in virtually every measure of economic success: For more than three decades, East Texans have looked to Dr. Ray Perryman for big-picture advice on the economy each year.
Hundreds of business and community leaders turned out for the 36th annual Perryman Economic Outlook Conference at the Green Acres CrossWalk Center on Thursday.
Perryman addressed current events, spoke frankly about challenges and broke down how the regional area performs compared with the rest of the country.
“I said last year that Tyler will grow faster than the state and national average,” Perryman said. “And you know what happened? You did it, and we’re predicting you’ll keep doing it.”
He began his address by tackling the issue on most everyone’s mind, the possibility of the United States waging another war in the Middle East.
Perryman joked that anytime a major event happens, he immediately gets calls from the press about the potential impact.
“Frankly, the economic impact, assuming it settles out, is not very much,” he said. “If we had that in the Middle East five years ago, the price of oil could go up $40 a barrel; it went up $4.”
He credited a much stronger energy sector for that relatively small bounce. Perryman also told attendees not to stress out on election-year rhetoric from either side.
“I try not to be partisan; I’m in the numbers business,” he said. “You’re going to hear a lot of crazy stuff; ignore it. Go to the beach.”
Perryman said that with no single party having the majority in the House, Senate and executive branch, the likelihood of radical change is unrealistic.
He said some issues are too big to ignore just because they’re politically inconvenient, though, particularly when it comes to climate change and renewable energy.
“Clearly we have issues with the climate, and we have to deal with it, and we can’t get by without oil and gas,” he said.
Perryman said that even with diversification of renewable, or green, energy, the country would still have a massive dependence on oil and gas.
“Ultimately we have to find answers in the middle,” he said.
Perryman also said that as politically unpopular as it is, immigration needs to be addressed because many high-skill industries are dependent on a workforce supplemented by immigrants. He said the medical field in particular has a high need.
“Best we can tell, this was the lowest decade of population growth since the plague of Jamestown,” Perryman said.
With low birth rates, low unemployment and more baby boomer generation workers retiring, a dwindling workforce could present real challenges, he said.
While the economy is in its 11th straight year of recovery, he doesn’t see a recession happening anytime soon. He said very few issues could trigger a recession, but noted that with a conflict in Iran we are more vulnerable to cyberattacks targeting power grids and financial institutions.
Perryman said a strong economy is more apparent in this region than virtually anywhere else.
From 2016 to 2018, Tyler ranked No. 4 in the entire nation for per capita income growth. Only oil-rich Midland and Odessa and a factory-driven economy in Midland, Michigan, topped the area. Unlike those other areas though, Perryman said region has a diversification of industry that the others lack, meaning when growth lags it won’t fall as dramatically as in many other cities.
“I like per capita income because it’s how much money is going to be in someone’s pocket,” he said. “So if you’re going to lead in something, that’s a good one.”
He also provided estimates for growth over the next five years, which show the region above state average in population growth, and above state and national averages for employment and real gross product gross.
Tyler will add about 11,500 jobs in the next half-decade and see a real gross product gain of 4.22 percent annually, for a total gain of $3.7 billion.
When it comes to challenges in the state, the region also is set to help lead the changes necessary with a strong medical sector and growth in higher education.
One of the first questions he got during the Q&A portion of the address was about the state of education in Texas.
“Is Texas’ postsecondary education model adequate for the next generation? Short answer, no,” he said. “Virtually everyone needs some level of postsecondary training beyond high school; not everyone needs a four-year degree.”
He said the state also isn’t addressing the crisis of affordability in higher education, but noted that through the history of the state lawmakers wait until late in the game to make sweeping change.
Other questions ranged from topics on vulnerabilities in the electrical grid to his opinion on downtown redevelopment grants.
Perryman’s forecast for the region points to sunny skies in 2020.