By Will McDermott
What the locals say
The Sunshine State’s future is bright.
Florida, or the Sunshine State as it is often called, has the fourth-largest state
economy in the U.S. behind New York, California and Texas. The state’s gross
domestic product (GDP) in 2016 was $926.05 billion, according to the U.S.
Bureau of Economic Analysis. As of second-quarter 2017, the annualized GDP
for 2017 was estimated to be $964.88 billion, a 4. 9 percent year-over-year
increase from second-quarter 2016.
The Sunshine State’s recovery after the housing crisis took a long time to
gain traction, however, as Florida suffered through five years of almost flat or
negative growth from 2008 through 2012, according to a report from Florida’s
Legislative Office of Economic and Demographic Research (EDR). In 2013,
Florida saw 2.1 percent growth in GDP, and the state’s GDP growth rate has
exceeded the national average every year since, according to a report from
the University of Florida’s Institute of Economic Competitiveness (IEC).
Job growth in the state began a bit earlier, according to the EDR report. As of
July 2017, the Sunshine State has experienced positive annual job growth for
84 straight months since August 2010. Job growth peaked in 2015 and 2016,
according to the IEC report, registering 3. 6 percent and 3. 5 percent respectively. This growth slipped to an estimated 2.5 percent in 2017 because of a
loss of economic momentum and the aftereffects of Hurricane Irma.
Florida ranked third among the states in total personal income growth in
2016, experiencing a 4. 9 percent jump over 2015, according to the EDR report.
This robust annual personal income growth is expected to continue through
2021, according to the IEC report. Unfortunately, the Sunshine State ranked
27th in the country in 2016 when total personal income is adjusted for
population (per capita personal income).
The large difference between total personal income and per capita personal
income may be linked to issues with Florida’s average annual wage, which
was 87. 7 percent of the national average in 2016, having improved from a low
of 87.2 percent in 2014, according to the EDR report. These low wages are a
function of the types of jobs that are growing the fastest in the state,
according to the report. As tourism rebounds, employment in the accommodations and food services sector — which tends to have the lowest-paying
jobs — has been growing faster than overall state employment.
The mix of jobs in Florida may be changing over the next few years, however.
The IEC report estimates that four major job sectors will experience strong
job growth in Florida from 2017 to 2021. Recent data from the U.S. Bureau of
Labor Statistics supports this forecast, showing solid job growth across the
four sectors. As of this past November, year-over year job growth in Florida’s
construction sector was 8. 7 percent, while manufacturing jobs expanded by
3. 9 percent. Professional and business services saw 3.1 percent job growth and
financial activities recorded a 2.8 percent jump in jobs during the period. n
Home sales and prices
Florida’s real estate market has improved dramatically over the past six
years. Closed sales on single-family homes rose 32. 3 percent from 2012
to 2016, according to Florida Realtors, while the annual median sales
price on Florida homes rose 51. 7 percent over that same time frame.
Over the 11 months through this past November, 248,875 single-family
home sales had closed in the state. This is a nearly 1 percent increase
over the 246,475 homes sold during the same period in 2016. The median sales price of single-family homes sold in November 2016 was
$220,000 — the same as the 2016 annual value. In November 2017,
the median sales price of a Florida home was $240,000, a 9 percent
increase year over year.
Florida Single-Family Home Sales
Source: Florida Realtors
Closed sales Median sales price
*Y TD through November 2017
Mark F. Johnson
President and chief operating officer,
Florida Capital Bank NA
“Jacksonville is one of the fastest-growing markets in the country.
One of the sources out there ranks it No. 4 of all cities in the
United States. So not only is it tops in Florida, it’s one of the
national leaders in growth. And a lot of that has to do with the
high job growth that’s going on here and a very affordable
housing market. ... And for anything in Florida, the weather and
no state income tax is always a plus.”