College of Professional Studies
STEVENS POINT AREA
ECONOMIC INDICATORS
First Quarter
2011
Marshall & Ilsley Bank
Presented by:
The Central Wisconsin Economic Research Bureau
Presented
Randy F. Cray, Ph.D.
Professor of Economics,
CWERB Director
November
12, 2010
Scott Wallace, Ph.D.
Associate Professor of Economics, CWERB Research Associate
James P. Draxler and Brittany J. Melby
Research Assistant
Featuring:
Measuring Entrepreneurial Activity
Special Report:
Debts & Deficits? How Big is Too Big?
Jason Davis, Ph.D.
Associate Professor of Economics
University of Wisconsin – Stevens Point
1
TABLE OF CONTENTS
National and Regional Outlook .............................................................................................. 1
Table 1: National Economic Statistics.......................................................................... 3
Central Wisconsin................................................................................................................... 4
Table 2: Unemployment Rate in Central Wisconsin .................................................... 4
Table 3: Employment in Central Wisconsin ................................................................. 4
Table 4: Wisconsin Employment Change By Sector .................................................... 5
Table 5: County Sales Tax Distribution ........................................................................ 6
Table 6: Business Confidence in Central Wisconsin .................................................... 6
Figures 1-7 .................................................................................................................... 7
Stevens Point-Plover Area ...................................................................................................... 8
Table 8: Retailer Confidence in Stevens Point – Plover Area .................................... 8
Table 9: Help Wanted Advertising in Portage County ............................................... 8
Table 10: Public Assistance Claims in Portage County ................................................ 9
Table 11: Public Assistance by Program Type ............................................................. 9
Table 12: Unemployment Claims in Portage County .................................................. 9
Table 13: Residential Construction in Stevens Point – Plover Area .......................... 10
Table 14: Nonresidential Construction in Stevens Point – Plover Area .................... 10
Figures 8-11 ................................................................................................................ 11
Housing Market Information
Table 1: National Median Home Prices ................................................................... 12
Table 2: National Existing Home Sales..................................................................... 12
Table 3: National Inventory ..................................................................................... 13
Table 4: National Affordability Index ....................................................................... 13
Table 5: Local Area Median Price ............................................................................ 13
Table 6: Local Units Sold .......................................................................................... 14
Table 7: Local Median Price ..................................................................................... 14
Table 8: Local Number of Home Sales ..................................................................... 14
Measuring Entrepreneurial Activity ..................................................................................... 15
Special Report ...................................................................................................................... 21
Debts & Deficits: How Big is Too Big?
Association for University
Business and Economic Research
CWERB - Division of Business and Economics
University of Wisconsin-Stevens Point
Stevens Point, WI 54481
715/346-3774 715/346-2537
www.uwsp.edu/business/CWERB
Outlook
A colleague of my mine told me about an ancient Chinese curse that translates into English as
“May you live in interesting times.” That seems to be an appropriate statement given recent
events in the world and at home. The earthquake in Japan and the resulting tsunami is
estimated to have caused over $300 billion worth of damage and will be the most costly natural
disaster in the history. No one knows what the impact will be on the world economy, but some
things do come to mind. The disruption of supply chains is a major concern. Japanese
companies are major suppliers of all manner of things especially in the area of electronics.
Companies as diverse as Apple Computer and BMW have expressed concerns about the
availability of sub-assemblies. However, at this juncture in time it appears the disruption is not
severe enough to derail the US economy. In addition the nuclear power industry in the US and
the rest of the world is likely to face greater opposition to any expansion plans. Nuclear power
accounts for about twenty percent of the electricity generated in the US. Any conversation
about curtailing this important power source would have to weigh its impact on the economy
with the potential cost of an accident on people and the environment. A more immediate
concern for the US is that Japan will likely have to look to other sources of energy like coal and
natural gas to replace its lost nuclear capacity. This could cause a ripple effect in the world’s
energy markets and drive up energy prices. If there is a silver lining in the disaster, it is that
history has taught us that there will be a massive rebuilding effort in Japan. The rebound in
activity will help the Japanese and world economy to recover from this black swan event. Some
analysts say it will take at least five years and a massive spending campaign to accomplish the
rebuilding.
The unrest rest in the Middle East also interjects more uncertainty into the economy. Witness
the sharp rise in oil prices. What will be the eventual outcome of the civil unrest taking place in
the Mideast and North Africa? Will the new governments be friendly to US interests in the
region or will we eventually face governments that are more hostile to the US and Israeli? The
economic and political impact to the US is unknown at this time. The strategic nature of the
region in terms of oil production is undisputed; if a country like Saudi Arabia fell in to the hands
of extremist this could have a major impact on our economy. US presidents since Nixon have all
talked about having a national policy that reduces our dependence on international sources of
energy. To date nothing of substance has been done to achieve that goal. To underscore this
point, one half of all US imports result directly from the importation of oil! Thus, cutting our
reliance on imported oil would have a strategic benefit and would improve our trade balance as
well. Some economists believe the only thing that could derail the economic recovery would be
the unlikely event of oil reaching $150 a barrel.
Another issue making life interesting is the political theater surrounding the balancing of the
Wisconsin State budget and the impact this will have on the economy. The magnitude of the
deficit (approximately $3.5 billion) and complexity of the impending cuts means that no one
knows exactly how this reshuffling of the economic deck will play out. However,
macroeconomic theory strongly suggests that borrowing money is a two edge sword.
Borrowing money in the short run bolsters consumption spending on goods and services and
props up employment, which is what Wisconsin has been doing for over a decade. In the long
run, the ever growing deficits hurt the economy as larger and larger shares of revenues are
used to pay back interest and principal. At some point, the situation becomes unsustainable.
Sooner or later the accounting gimmicks run out and the structural imbalance must be dealt
with by cutting spending and/or raising taxes and fees. The state has taken the approach of
dramatically cutting spending. The problem with cutting spending (as rapidly as what the state
has proposed) is that it takes a large amount of spending out of the economy and this spending
cannot be easily replaced by other sectors of the economy. Some would argue that a more
gradual measured approach to balancing the budget would be less disruptive to the economy.
Make no mistake about it, the cuts in spending are real and will create an economic drag on the
state economy. Many business firms in the state will notice a drop in the demand for their
goods and services. Some hope that the private sector will make up the lost spending and the
jobs lost from the rapid cutting of the deficit. I hope this is true because the Wisconsin
economy is very fragile at this stage of the recovery and the elimination of this much spending
from the economy will hamper the recovery.
I would now like to turn our attention to the economic indicators to see what they portend for
the economy in 2011. The Leading Indicators Composite Index is comprised of ten very
important economic data series. The purpose of the index is to give insight into the future
direction of the economy. The LICI has been rising steadily since early 2009 when it bottomed
out at about 98. The LICI has been expanding since then and in December 2011 the index
reached 112.4. Thus the LICI is signaling that the economy will continue to expand into 2011.
As I have said in previous reports the index does not address the strength of the expansion. In
addition, the LICI is not that useful when unexpected events impact the economy. The
University of Michigan and the Conference Board’s Survey’s of Consumer Sentiment and
Confidence shows households in the US are becoming increasingly more optimistic about the
economic recovery. This is very note worthy because households account for approximately 70
percent of all economic activity in the US.
In addition, Real Gross Domestic Product expanded at a revised 3.1 percent in Fourth Quarter
2010 and in First Quarter rose by 1.8 percent which was less than what most economists had
forecasted. This is the seventh straight quarter that the economy has expanded its production
of goods and services. Nonfarm payrolls added a very modest 152 thousand jobs in December.
The recovery is still characterized as being one of very slow job growth. With over 8 million jobs
lost in the recession, a full recovery in employment could be years away. The unemployment
rate dropped to 8.9 percent in February. The pre-recession unemployment rate was around 4.5
percent. Due to structural changes in the economy, it is going to take a long time before we can
achieve the pre-recession unemployment rate. Inflation remains abated if we look at the core
CPI figures. For December 2010 the annualized rate was just 0.8 percent. However, the overall
CPI which includes food and energy costs rose by a more threatening rate of 3.2 percent. The
Federal Reserve needs to keep a close on these numbers, and if inflation appears to be trending
out of its target range, then it needs to be ready to drain liquidity from the economy. Lastly,
corporate profits remain very strong and reached a record $1.7 trillion toward the end of 2010.
A major contributor to the record profits can be attributed to business operations outside the
2
country in the faster growing regions of the world like China, India, and South America. This is a
major reason in explaining how firms have become so profitable without needing to expand US
payrolls.
Finally, let’s turn our attention to the economic forecast 2011. MSNBC reported that an
Associated Press survey of 42 businesses and academic economists showed that economic
condition should strengthen in 2011. This survey group forecasts real GDP to grow by 3.0 to 3.5
percent for the remainder of the year. Employment in the US is expected to increase by over 2
million jobs in 2011 more than doubling last year’s employment growth. The group’s consensus
forecast is the inflation rate for the year will be around 2.8 to 3.0 percent for the year. Further,
the core inflation rate which ignores the volatile energy and food sectors is expected to grow at
a 1.7 percent rate this year after only rising by 0.8 percent in 2010. Their forecast is consistent
with the forecast of Federal Reserve Board Chairman Ben Bernanke.
TABLE 1
NATIONAL ECONOMIC STATISTICS
2010
First Quarter
2011 Percent
First Quarter Change
Nominal Gross Domestic Product (Billions)
$14,446.4
$15,006.4
+3.9
Real Gross Domestic Product (Billions of 2000 $)
$13,138.8
$13,438.8
+2.3
94.9
93.6
-1.4
0.18%
0.07%
-63.9
218.2
223.5
+2.4
Industrial Production (2002 = 100)
Three Month U.S. Treasury Bill Rate
Consumer Price Index(1982-84 = 100)
3
Central Wisconsin
The unemployment rate fell in all reporting areas (see Table 2). In March 2011 Portage,
Marathon, and Wood counties saw their unemployment rates fall to 7.5, 8.2, and 8.7 percent
respectively. The labor force weighted unemployment rate for Central Wisconsin declined from
9.9 to 8.1 percent.
TABLE 2
Similarly Wisconsin’s
UNEMPLOYMENT RATE Unemployment Rate Unemployment Rate Percent
rate fell from 9.8
CENTRAL WISCONSIN
March 2010
March 2011 Change
percent to 8.1 percent
and the United States
Portage County
8.4%
7.5%
-10.8
unemployment rate
City of Stevens Point
11.4%
9.2%
-19.3
from 10.2 percent to
9.2 percent. Thus, the
Marathon County
10.6%
8.2%
-22.7
past year saw an
improvement in the
Wood County
10.3%
8.7%
-15.5
unemployment
Central Wisconsin
9.9%
8.1%
-18.2
numbers. This is
especially good news
Wisconsin
9.8%
8.1%
-17.2
because all areas
United States
10.2%
9.2%
-9.9
except for Portage
County also
experienced employment growth.
Employment figures in Table 3 are based on a survey of households. Given the economic
turmoil caused by a plant closure, it was not surprising that Portage County employment fell by
0.4 percent over the course of the year. Better news comes from Marathon and Wood County
payrolls which
TABLE 3
Total Employment Total Employment Percent expanded by 1.8
EMPLOYMENT
March 2010
March 2011 Change percent and 1.4
CENTRAL WISCONSIN
(Thousands)
(Thousands)
percent respectively
over the same period.
Portage County
39.6
39.4
-0.4
Central Wisconsin as
City of Stevens Point
13.6
13.8
+1.5
a whole experienced
an employment
Marathon County
65.6
66.8
+1.8
increase of about
Wood County
36.7
37.3
+1.4
1,500 positions.
Employment in the
Central Wisconsin
141.9
143.4
+1.1
three counties rose
Wisconsin
2,733.3
2,804.2
+2.6
from 141.9 to 143.4
thousand or by 1.1
United States
137,982
138,962
+0.7
percent. The state of
* Percent change figures reflect data before rounding
Wisconsin saw its
employment ranks
4
rise by 2.6 percent and the nation gained 0.7 percent or about 980 thousand jobs over the year.
Thus, the amount of job generation has been very modest over the past twelve months. At this
rate it would take the nation about eight years to recover the jobs lost during the recession.
Table 4 gives the latest firm based employment numbers for Wisconsin. Information from the
state of Wisconsin was not available at the time of the report for the state’s non-metro
counties. From Mach 2010 to March 2011 Wisconsin’s total nonfarm employment rose ever so
slightly from 2.677 million to 2.704 million or by 1.0 percent. This represents a gain of 26.6
thousand jobs during the past year. The sectors of the economy to experience job growth were
the manufacturing, trade, transportation and utilities, information services, professional and
TABLE 4:
WISCONSIN EMPLOYMENT
CHANGE BY SECTOR
Employment
March 2010
(Thousands)
Employment
March 2011
(Thousands)
Percent
Change
Total Nonfarm
2677.6
2704.2
+1.0
Total Private
2250.1
2275.3
+1.1
Natural Resources and Mining
2.5
2.4
-4.0
Construction
81.6
74.4
-8.8
Manufacturing
420.6
437.3
+4.0
Trade, Transportation, and Utilities
496.4
498.3
+0.4
Information
46.1
46.6
+1.1
Financial Activities
157.8
155.2
-1.6
Professional and Business Services
257.0
262.7
+2.2
Educational and Health Services
418.5
423.1
+1.1
Leisure and Hospitality
233.6
233.3
-0.1
Other Services, exc Public
136.0
142.0
+4.4
Government
427.5
428.9
+0.3
business services, educational and health services, other services and government. Good news
for the state is the manufacturing sector, after many years of contraction, expanded by about
17.0 thousand positions or by 4.0 percent over the year. However, the employment results for
the rest of the industrial sectors were disappointing. The natural resources and mining,
construction, financial activities, and the leisure and hospitality sectors all experienced declines.
County sales tax distributions were above the pace of a year ago (Table 5). Portage County
sales tax distributions rose from $1.06 million to $1.16 million, an increase of nearly 9.7 percent.
Likewise, Marathon and Wood County experienced healthy changes in their sales tax
distributions from the state. Marathon rose from $2.14 million to $2.43 million or by 13.7
percent, and Wood County expanded from $1.04 million to $1.14 million, or by about 9.2
5
percent over the course of the past year. These data clearly shows the pace of retail activity is
accelerating in Central Wisconsin.
TABLE 5
COUNTY SALES TAX DISTRIBUTION
2010
First Quarter
(Thousands)
2011
First Quarter
(Thousands)
Percent
Change
Portage County
$1,060.2
$1,163.2
+9.7
Marathon County
$2,139.5
$2,431.9
+13.7
Wood County
$1,039.3
$1,135.0
+9.2
* Percent change figures reflect data before rounding
The CWERB’s survey of area business executives is reported in Table 6. This group believes that
recent economic changes at the national level have led to a modest improvement in conditions.
In addition they believe the local business climate has modestly improved over the past year.
When they were asked to forecast the future they expect economic conditions to improve in
2011. They expressed more optimism for the local economy and for their particular industry in
2011. Basically they felt that economic matters would improve for their business and for their
community. Table 6 also shows that the level of optimism was higher in March 2011 than in
December 2010. This bodes well for the local area.
TABLE 6
BUSINESS CONFIDENCE
Index Value
December 2010
March 2011
Recent Change in National
Economic Conditions
60
69
Recent Change in
Local Economic Conditions
58
56
Expected Change in
National Economic Conditions
65
67
Expected Change in
Local Economic Conditions
65
67
Expected Change in
Industry Conditions
62
65
100 = Substantially Better
50 = Same
0 = Substantially Worse
Figures 1 thru 7 give a historic overview of how the economy in Wisconsin has performed
during the 2006-2011 time period. Figure 5 shows the dramatic decline in Wisconsin
manufacturing and the rebound taking place since 2010. In 2006 about 508 thousand were
employed in manufacturing and at the end of 2010 the number of jobs bottomed out at
6
approximately 430 thousand; thus the recession caused 80 thousand jobs to be lost in this
sector. Since that time the rebound in activity has added about 20,000 positions to the
manufacturing sector. Figure 7 shows the steep decline in the number of people employed in
leisure & hospitality, from about 262 thousand in 2007 to 250 thousand in the early part of
2011. Thus about 12 thousand jobs have been lost over the past three years in this sector.
3000
2975
2950
2925
2900
2875
2850
2825
2800
2775
Figure 1: Employment Level: WI
2006
11
10
9
8
7
6
5
4
3
2007
2008
2009
2010
2011
Figure 3: Unemployment Rate: WI
2006
2007
2008
2009
2010
2011
300
275
250
225
200
175
150
125
100
2006
2009
2010
2011
Figure 4: Labor Force: WI
3175
3150
3125
3100
3075
3050
3025
3000
2006
2007 2008 2009
2010
2011
Figure 5: Manufacturing: WI
510
500
490
480
470
460
450
440
430
420
Figure 2: Unemployment Level: WI
2007
2008
Figure 6: Education and Health Services: WI
425
420
415
410
405
400
395
390
385
2006
2007
2008
2009
2010
2006
2011
Figure 7: Leisure and Hospitality: WI
265.0
262.5
260.0
257.5
255.0
252.5
250.0
247.5
2006
2007
2008
2009
2010
2011
7
2007
2008
2009
2010
2011
Stevens Point – Plover Area
We usually include Table 7 which gives employer based estimates of industrial sector
employment in Portage County. However, please note at the time the report was written, the
data for March were not available from the Wisconsin Department of Workforce Development.
Hopefully the data will be available in on a timely basis in the future and will be included in the
report.
In Table 8 the CWERB’s survey of area retailers became a bit more pessimistic in March 2011 as
compared to December 2010. Retailers feel that store traffic and store sales did not improve
over March of the previous year. It appears that December 2010 assessment of retail activity
was marginally
TABLE 8
stronger than in March
RETAILER CONFIDENCE
Index Value
2011. This group also
STEVENS POINT - PLOVER AREA December 2010
March 2011
feels that retail activity
in the early part of
Total Sales Compared
50
48
2011 will be better
to Previous Year
than the retail scene of
2010. The overall
Store Traffic Compared
48
48
significance of the
to Previous Year
survey is that local
Expected Sales Three
55
57
merchants are giving us
Months From Now
a mixed picture as to
what retail conditions
Expected Store Traffic
52
57
are like in our area.
Three Months From Now
100 = Substantially Better
50 = Same
0 = Substantially Worse
Please note the CWERB is unveiling a new help wanted advertising measure that is based on job
advertising on the web. Table 9 Help Wanted Advertising is a barometer of local labor market
conditions and for the first time the indexes for Stevens Point, Wausau, Marshfield and
Wisconsin Rapids are based on job advertising on the internet. The index for Stevens Point and
Marshfield rose by 5.8 percent and by 2.4 percent respectively when compared to a year ago.
However, Wausau and Wisconsin Rapids experienced small declined the amount if advertising
taking place, 4.4 percent and 5.3 percent respectively. The, data suggests that advertising
growth was
TABLE 9
Index Value
uneven in the
HELP WANTED ADVERTISING Fourth Quarter 2010 First Quarter 2011 Percent Change area labor
markets. Perhaps
Stevens Point
365.00
386.00
5.75%
as 2011 unfolds
Wausau
817.67
781.67
-4.40%
we see a
stronger overall
Marshfield
432.08
442.25
2.35%
market for job
Wisconsin Rapids
194.50
184.17
-5.31%
seekers.
8
Tables 10, 11 and 12 give valuable insight into how local family financial distress fared in
Portage County over the past year. The number of new applications for public assistance
decreased from
TABLE 10
2010
2011 Percent
169 to 154 or by
PUBLIC ASSISTANCE CLAIMS
First Quarter
First Quarter Change
8.9 percent.
However, the total
PORTAGE COUNTY
(Monthly Avg.) (Monthly Avg.)
caseload for public
New Applications
169
154
-8.9
assistance
contracted from
Total Caseload
6,652
6,671
+0.3
6,652 to 0nly
6,671 or by a scant 0.3
TABLE 11
percent over the year.
BY PROGRAM TYPE
First Quarter 2011
Table 11 gives detailed
PORTAGE COUNTY
January
February
March
Average
information on the types
of public assistance for
Medical Assistance
11,310
11,307
11,285
11,301
January-March. Since the
(All Programs)
data are new to the report,
we do not have
Food Share
6,195
6,222
6,139
6,185
comparable numbers for
(Food Stamps)
2010. In the future we will
be able to give year over
W2
29
29
25
28
percentage changes for
(Paid Cases Only)
these numbers. In Table
12 the number of new
Wisconsin Shares
486
475
414
458
unemployment cases fell
Child Care
by over 10 percent when
compared to the levels in
TABLE 12
2010
2011 Percent 2010. In addition and
UNEMPLOYMENT CLAIMS
First Quarter
First Quarter Change more importantly the total
PORTAGE COUNTY
(Weekly Avg.)
(Weekly Avg.)
claims number dropped
from 3449 to 2,931 or by
New Claims
356
319
-10.2
about 15 percent over the
year. Obviously these
Total Claims
3449
2931
-15.0
results are good news for
the local area.
Table 13 presents the residential construction numbers for the Stevens Point-Plover area. In
our yearly comparison the number of permits issued in First Quarter was 7 and they had an
estimated value of $1.75 million. The number of housing units total was 7. When comparing
First Quarter 2010 to that of 2011 the residential alteration activity contracted from 177 to 129
permits and the value of this type of this type of activity went down from $2.2 to $1 million.
Thus, overall the 2011 construction data were well off the pace of a year ago. The very cold and
snowy weather during First Quarter surely played a significant role in this outcome.
9
TABLE 13
RESIDENTIAL CONSTRUCTION
STEVENS POINT - PLOVER AREA
2010
First Quarter
Residential Permits Issued
Estimated Value of
New Homes
15
7
-53.3
$2,814.8
(thousands)
$1,748.0
(thousands)
-37.9
16
7
-56.3
177
129
-27.1
$2,279.3
(thousands)
$1,008.9
(thousands)
-55.7
Number of Housing Units
Residential Alteration
Permits Issued
Estimated Value
of Alterations
2011 Percent
First Quarter Change
The nonresidential construction figures in Table 14 were as follows for First Quarter 2011. The
number of permits issued was six and the estimated value of $11.2 million. This is a large
increase over the 2010 estimated value of new structures figure. The number of business
alteration permits was 49 in 2010 compared to 44 in 2011. The estimated value of alteration
activity was $1.62 million in 2010 compared to the 2011 figure of $1.35 million. In sum the pace
nonresidential construction activity of this year was more brisk than in the prior year.
TABLE 14
NONRESIDENTIAL CONSTRUCTION
STEVENS POINT - PLOVER AREA
2010
First Quarter
Number of Permits Issued
Estimated Value of
New Structures
Number of Business Alteration Permits
Estimated Value
of Business Alterations
2011
First Quarter
3
6
$480.0
(thousands)
$11,202.0
(thousands)
49
44
$1,625.1
(thousands)
$1,349.5
(thousands)
* Includes Stevens Point, Village of Plover, and the Towns of Hull, Stockton, Sharon,
and Plover.
10
Figures 8 thru 11 give a history lesson as to how the employment level, the unemployment level,
the unemployment rate, and the labor force have trended over the past five years in Portage
County. The figures clearly show the influence of the great recession on the area local economy
and the figures also help to put data into a context so the magnitude of the events can be
judged more properly.
Figure 8: Employment Level: Portage
41500
41000
40500
40000
39500
39000
38500
38000
37500
2006
2007 2008 2009 2010
Figure 9: Unemployment Level: Portage
4000
3500
3000
2500
2000
2011
Figure 10: Unemployment Rate: Portage
10
9
8
7
6
5
4
3
2006
2007 2008 2009 2010 2011
1500
1000
2006
2007
2008
2009
2010
2011
Figure 11: Civilian Labor Force: Portage
44.5
44.0
43.5
43.0
42.5
42.0
41.5
41.0
40.5
40.0
2006
11
2007
2008
2009
2010
2011
Housing Market Information
The following seven tables contain information on the national, regional, and local housing
market. We believe the reader will gain valuable insight into housing markets conditions and
greater insight into the local economy. The CWERB would like to acknowledge and thank Dr.
David Schalow of the University of Wisconsin – Stevens Point School of Business and Economics
for the collection of these data.
TABLE 1
NATIONAL MEDIAN
HOME PRICES
U.S
FIRST QUARTER 2011
NORTHEAST
MIDWEST
SOUTH
WEST
2006
$221,900
$271,900
$167,800
$183,700
$342,700
2007
219,000
279,100
165,100
179,300
335,000
2008
198,100
266,400
154,100
169,200
271,500
2009
172,500
240,500
144,100
153,000
211,100
2010
173,000
243,500
141,699
150,100
215,100
March 2011 p
159,600
232,900
126,100
138,200
192,100
SOUTH
WEST
TABLE 2
NATIONAL EXISTING
HOME SALES
U.S
FIRST QUARTER 2011
NORTHEAST
MIDWEST
2006
6,478,000
1,086,000
1,483,000
2,563,000
1,346,000
2007
5,652,000
1,006,000
1,327,000
2,235,000
1,084,000
2008
4,913,000
849,000
1,129,000
1,865,000
1,070,000
2009
5,156,000
868,000
1,163,000
1,914,000
1,211,000
2010
4,908,000
817,000
1,076,000
1,861,000
1,154,000
March 2011 p
*Annualized Basis
5,100,000
800,000
1,060,000
1,990,000
1,250,000
12
TABLE 3
NATIONAL
INVENTORY
TABLE 4
NATIONAL
AFFORDABILITY INDEX
FIRST QUARTER 2011
INVENTORY MONTH SUPPLY
2006
3,450,000
6.5
2007
3,974,000
8.9
2008
3,700,000
10.4
2009
3,283,000
8.8
2010
3,560,000
9.4
March 2011 p
3,549,000
8.4
FIRST QUARTER 2011
MEDIAN PRICED
MONTHLY PAYMENT MEDIAN
EXISTING SINGLE MORTGAGE
P&I
AS A %
FAMILY QUALIFYING
FAMILY HOME
RATE
PAYMENT OF INCOME INCOME
INCOME COMPOSITE
2007 r
217,900
6.52
1,104
21.7
61,173
52,992
115.4
2008 r
196,600
6.15
958
18.1
63,366
45,984
137.8
2009 r
172,100
5.14
751
14.6
61,845
36,048
171.6
2010 r
173,200
4.89
735
14.3
61,583
35,280
174.6
March 2011 p
160,500
4.98
688
13.3
62,004
33,024
187.8
P&I = Principal and interest
Composite = measures affordability. For example for the year 2010, the index of 168.3 means a family earning the median family income has 168.3 percent of the income necessary
to qualify for a conventional loan covering 80 percent of a median-priced existing single-family home.
TABLE 5
LOCAL AREA
MEDIAN PRICE
WISCONSIN
MARATHON
PORTAGE
WOOD
2007
$163,000
$136,000
$133,500
$100,000
2008
154,000
134,500
135,000
94,000
2009
142,500
126,800
132,000
94,500
2010
141,000
123,000
132,375
97,000
13
TABLE 6
LOCAL
UNITS SOLD
WISCONSIN
MARATHON
PORTAGE
WOOD
2007
67,397
1,400
690
716
2008
54,924
1,142
533
652
2009
55,132
1,090
532
714
2010
51,263
1,074
474
620
TABLE 7
LOCAL MEDIAN
PRICE
FIRST QUARTER 2011
MARATHON
PORTAGE
WOOD
First Quarter 2010
124,500
109,000
96,000
First Quarter 2011
95,000
141,750
76,900
Percent Change
-23.7%
30.0%
-19.9%
TABLE 8
NUMBER OF
HOME SALES
MARATHON
FIRST QUARTER 2011
PORTAGE
WOOD
First Quarter 2010
108
49
73
First Quarter 2011
69
30
45
Percent Change
-36.1%
-38.8%
-38.4%
14
Measuring Entrepreneurial Activity as Potential Measure of Job Growth
UWSP Small Business Development Center
Vicki Lobermeier, SBDC Director of Entrepreneurship Activities
Mary Wescott, SBDC Counseling Manager
According to a March, 2011 release from the Ewing Marion Kauffmann Foundation report on
the index of entrepreneurial activity, during the recent recession, more Americans chose
entrepreneurship than any time in the previous 15 years. The economy and high
unemployment rates may have led individuals to start businesses, but most of them started
non-employer entities, which are companies that do not hire employees.
According to the "Kauffman Index of Entrepreneurial Activity," a leading indicator of new
business creation in the United States, 0.34 percent of American adults created a business per
month in 2010, or 565,000 new businesses, a rate that remained consistent with 2009 and
represents the highest level of entrepreneurship over the past decade and a half. In contrast,
however, the quarterly employer firm rate has dropped from 0.13 percent in 2007 to 0.10
percent in 2010.
Why is it important to measure Entrepreneurial Activity? According to Tom Still, president of
the Wisconsin Technology Council and the Wisconsin Innovation Network as quoted in the
Milwaukee Journal Sentinel, it's vital to the ongoing discussion about job growth. Many studies
indicate that entrepreneurs and startup companies are the source of most new jobs in the
United States.
Among the attributes to record and measure, the Kauffmann Index of Entrepreneurial Activity
suggests measuring
 New Business Development – New incorporations and LLC formations
 Access to Capital – US Small Business Administration Loans
 Intellectual Property Creation - Patents issued to individuals and companies
We’ll use these measures to show entrepreneurial activity in the Portage, Marathon and Wood
Counties for the first quarter (1Q) of 2010 compared to 2011. In future reports we’ll continue
to benchmark these measures that Kauffmann suggests are one measure of Entrepreneurial
Activity.
Please note that New Business Development includes only separate legal entities of LLC and
Incorporations and does not include formations of sole proprietors.
Additional reports available are reports from Economic Modeling Specialists, EMSI, which
projects job growth by industry and impacts of job loss by industry.
15
New Business Development
st
2010 1 Quarter Incorporations 24 LLC Formations 224 248 total business starts
st
2011 1 Quarter Incorporations 19 LLC Formations 220 239 total business starts
Formal LCC and Inc Starts
100
80
60
40
Formal Starts
20
0
Total LLC and Inc Starts
250
240
230
Total Starts
220
210
200
2010
2011
Access to Capital
According to SBA reports, Wisconsin banks issued $58.6 million in government-backed smallbusiness loans in March - down from $74 million in February but above any of the five previous
March totals. 185 loans were issued in March in Wisconsin. 10 were issued in our three-county
area. In our 3-county region, SBA Total Loan Amounts for 1st quarter 2011 were $622,400
higher than the first quarter of 2010 while the total number of loans decreased from 27 to 20.
2010 $4,315,100
2011 $4,937,500
16
Total Loan Amount/Month
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
Jan '10
Jan '11
Feb '10
Feb '11
March
'10
March
'11
Total Number of SBA Loans
12
10
8
6
4
2
0
Jan '10
Jan '11
Feb '10
Feb '11
March '10 March '11
Overall Total SBA Loan Amount 1 Q
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
2010
2011
17
Intellectual Property Creation
During the first quarter of 2011, 419 patents were issued in Wisconsin. Of those, 3 were
assigned to companies in the three-county area of Portage, Marathon and Wood. Another 3
patents were created by local inventors, but assigned to WI companies outside of our area.
Industries Projected for Growth 2010 - 2015
Description
Agriculture, natural resources, and mining
Construction
Education and health services
Financial activities
Government
Information
Leisure and hospitality
Manufacturing
Other services
Professional and business services
Trade, transportation, and utilities
Total
2010
2015
Jobs
jobs
Growth
%
7,484
6,992
-492 -7
7,260
7,708
448
6
27,327
31,052
3,725 14
17,235
18,979
1,744 10
18,816
18,899
83
0
2,320
2,421
101
4
13,091
13,864
773
6
24,739
22,408
-2,331 -9
9,058
9,487
429
5
11,986
13,511
1,525 13
37,529
38,186
657
2
176,844 183,507
6,663
4
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
2010 Jobs
2015 jobs
18
Industries Projected for Growth 2005 – 2015
Description
Agriculture, natural resources, and
mining
Construction
Education and health services
Financial activities
Government
Information
Leisure and hospitality
Manufacturing
Other services
Professional and business services
Trade, transportation, and utilities
Total
2005
jobs
2015
jobs
7,591
8,920
24,579
15,832
18,394
2,480
13,125
30,307
8,808
11,789
40,851
182,675
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
6,992
7,708
31,052
18,979
18,899
2,421
13,864
22,408
9,487
13,511
38,186
183,507
growth
-599
-1,212
6,473
3,147
505
-59
739
-7,899
679
1,722
-2,665
832
%
-8
-14
26
20
3
-2
6
-26
8
15
-7
0
2005 jobs
2015 jobs
19
Benchmarking Entrepreneurship
Fashioned after the Kauffman Index of Entrepreneurial Activity
2011 First Quarter, January – March
Summary Data for Marathon, Portage and Wood Counties
New Business Development
First quarter 2010 there were a total of 248 new business entities created with 224 new LLCs
formed and 24 new incorporations. The numbers of sole proprietorships created during any
period is unknown. First quarter 2011 there were a total of 239 new business entities created
with 220 new LLCs formed and 19 new incorporations. This is just slightly fewer than 2010.
Access to Capital
Nearly 5M in SBA loans were issued in 2011 compared to 4.3M in 2010. The number of loans
was fewer in 2011, but the overall capital infusion amount into the marketplace was greater.
Intellectual Property Creation
During the first quarter of 2011, 419 patents were issued in Wisconsin. Of those, 3 were
assigned to companies in the three-county area of Portage, Marathon and Wood. Another 3
patents were created by local inventors, but assigned to WI companies outside of our area. The
patents assigned to local companies were vehicle, equipment, or agricultural related.
Industries Projected for Job Growth
According to EMSI software data compilations, the total number of jobs in the three county
areas will rise by 832 positions between 2005 and 2015. Growth is projected for education and
health services, professional and business services, and leisure and hospitality.
20
Debt and Deficits: How Big is Too Big?
Jason R. Davis, Ph.D.
Associate Professor of Economics
University of Wisconsin – Stevens Point
INTRODUCTION
“We will continue along the path toward a balanced budget in a balanced economy.”
-President Lyndon Johnson, January 4, 1965
“We must balance our federal budget so that American families will have a better chance to
balance their family budgets.”
-President Richard Nixon, January 22, 1970
“We can achieve a balanced budget by 1979 if we have the courage and the wisdom to continue
to reduce the growth of Federal spending.”
-President Gerald Ford, January 15, 1975
With careful planning, efficient management, and proper restraint on spending, we can move
rapidly toward a balanced budget, and we will.”
-President Jimmy Carter, January 29, 1978
“[This budget plan] will ensure a steady decline in deficits, aiming toward a balanced budget by
the end of the decade.”
-President Ronald Reagan, January 25, 1983
“[This budget plan] brings the deficit down further and balances the budget by 1993.”
-President George H. W. Bush, January 31, 1990
“[This budget plan] puts in place on of the biggest deficit reductions…in the history of this
country.”
-President William Clinton, February 17, 1993
“Unrestrained government spending is a dangerous road to deficits, so we must take a different
path.”
-President George W. Bush, February 27, 2001
“We need to take responsibility for our deficit, and reform our government.”
-President Barak Obama, January 25, 2011
The above quotes, all taken from Presidential State of the Union addresses, show that deficit
reduction has been a common goal of presidents regardless of their differences in political
party or economic policies. While the goal may be common, the reality is that government
deficits have been trending upward over most of this timeframe and are currently at record
levels. This paper aims to explore the trends in deficits and debt, if and when the federal
government should engage in deficit spending, and the potential impacts of debts and deficits
on the economy as a whole.
21
RATIONALES FOR DEFICIT SPENDING
Are there good reasons for the government to engage in deficit spending, or is this simply
irresponsible behavior? While this is a fairly complicated question, we can gain some insights
be examining when household borrowing is considered to be appropriate.
Using Deficits to Smooth Business Cycles
From a personal finance perspective, households should plan their budget so that they are able
to pay routine expenses out of their current income. One of the goals of financial planning is to
smooth consumption over fluctuations in income that might occur due to changes in
employment and retirement. Households are thus expected to save part of their income during
their working years to provide for retirement, and to save during years with above-average
income to offset years with below-average income.
Because the government does not face the same lifetime constraints, the government does not
need to save for retirement purposes. However, business cycle fluctuations naturally affect the
government’s balance sheet. During economic downturns, reductions in national income result
in reduced tax revenue to the government. In addition, more households qualify for
unemployment insurance payments and public assistance programs causing government
spending to naturally increase. If the government had expected a balanced budget, they would
now be facing a deficit due to reduced tax revenue and increased spending. During periods of
rapid growth, the opposite effect occurs, leading to increased tax revenues and reduced
government spending. If the government had planned a balanced budget, this would naturally
result in a government surplus.
As a result, the government should respond to these fluctuations much like households who
smooth their budgets over the long term. This implies that if the government truly desires a
balanced budget over the long term, they should plan for a balanced budget assuming that the
economy will grow at the average of 2-3% each year. This is typically referred to as a
structurally balanced budget. During years when the economy grows faster than average, the
government will experience a cyclical surplus; during years where the economy grows slower
than average, or even declines, the government will experience a cyclical deficit1.
If the government plans for a structurally balanced budget, the impact of business-cycle
fluctuations can be smoothed over the long run by saving surpluses during upturns to offset the
need for deficit spending during downturns.
Using Deficits to Finance Infrastructure Projects
Turning again to personal finance, it is generally accepted that while households should not
normally borrow to cover routine expenses; borrowing is appropriate to finance purchases that
provide long-term value to the household. In this case, borrowing allows the household to
1
Cyclical surpluses/deficits are defined as the part of the actual surplus/deficit attributed to business-cycle
fluctuations, rather than planned government revenues and spending.
22
spread the cost of the purchase over the years when benefits are reaped. Examples would
include mortgages for owner-occupied housing and loans to finance education and vehicle
purchases.
The same argument can be made for government budgeting. Borrowing is warranted to fund
capital investments such as government buildings, new roadways, and other types of
infrastructure projects.
Using Deficits to Steer the Macroeconomy
A third argument for deficit spending is to help stimulate the economy to reduce the duration
and severity of recessions. Because this is looking at a collective, rather than individual,
outcome, there is no clear analogy that relates to personal finance. In response to recession,
the government can encourage growth in spending, either directly through increased
government purchases, or indirectly through tax cuts which allows for greater spending by
taxpayers. Either of these options will cause an increase in deficits in order to boost spending
in the economy. These increases in spending result in higher incomes which cause total
spending to grow further. The end result is that the total growth in the economy exceeds the
initial boost provided by deficit spending.
As discussed earlier, recessions will naturally lead to reduced tax revenues and increased
spending because of the structure of the tax code, unemployment insurance and public
assistance programs. These responses do not require any new action by Congress and are thus
often referred to as ‘automatic stabilizers.’ During a deep recession, though, the government
may want to further stimulate the economy beyond the impact of automatic stabilizers. This
was the argument behind stimulus spending packages introduced under both the Bush and
Obama administrations. While the purpose of the stimulus packages was motivated by steering
the economy back on course, the use of stimulus funds was fairly consistent with the previous
topics discussed; much of it was geared toward infrastructure building, extending
unemployment insurance benefits, and alleviating state burdens associated with extended high
case-loads in public assistance programs.
The big question is whether such stimulus spending actually works? Unfortunately, there is no
clear answer to this question. Opponents of stimulus spending point to the slow, stagnant
recovery and claim that these actions have not, in fact, worked to adequately stimulate the
economy. Proponents reply that the recession would be deeper and longer without stimulus
spending. Economists are fairly divided between these two arguments with no clear consensus
on which view is correct.
NEGATIVE IMPACTS OF DEFICITS AND DEBT
As stated previously, governments don’t face a specific lifetime constraint for debt repayment;
stable governments then have a seemingly infinite time horizon for paying back debt, making it
easier to justify government borrowing. However, increased government borrowing is not
without consequences and there are potential costs that should be considered.
23
Reductions in Private Borrowing
One of the main consequences of government borrowing is that it reduces the level of private
borrowing to finance business expansions of buildings and equipment. As the government
increases their borrowing, the increased competition for loanable funds drives up interest rates
making private borrowing more costly. As a result of reduced loanable funds and higher
interest rates, less private business borrowing takes place. This causes a reduction in the
capital stock which ultimately limits future growth potential.
International Leakages
In a global economy, the impact of government borrowing on the availability of loanable funds
and interest rates may be very small due to the availability of loanable funds from other
countries. While this avoids the previous problem of reduced capital stock and limited growth
potential, it creates new problems in the economy. If either government or private borrowing
are financed through foreign sources, then payments on that debt flows outside of the country,
rather than recirculating through the economy as increased income and spending. This, too,
will limit the growth potential of the U.S. economy into the future. As of January 2011,
approximately 47% of the U.S. debt held by the public was foreign-owned, meaning about half
of the interest payments are currently flowing to foreign sources (Department of the Treasury,
2011; Congressional Budget Office, 2011).
EMPIRICAL TRENDS IN DEFICITS AND DEBT
Chart 1 shows government revenue and spending trends, as a percentage of GDP, from 1970 to
2010. From 1970 to 1990, the trends show persistent deficits indicating that the budget suffers
from structural deficits. The cyclical impact can also be seen as the deficits deepen during
recessionary times and are reduced during periods of expansion.
The 1990’s, though appear to be different. Unusually strong economic growth in the 1990’s
obviously followed the cyclical pattern of not only reducing the deficit, but actually creating a
surplus. While a large part of this is simply due to a favorable business cycle, at least part of
this impact is due to pay-as-you-go (PAYGO) financing established by the 1990 Budget
Enforcement Act. PAYGO resulted in discretionary spending caps that required reductions in
real spending during the 1990’s. PAYGO also required that any tax cuts or increased spending
on entitlement programs (the largest being Social Security, Medicare and Medicaid) must be
accompanied by spending cuts to offset any projected deficits during the next six years. The
PAYGO legislation expired in 2002 which, coupled with economic recession, resulted in sharply
increased deficits in the 2009 and 2010.
Deficits and surpluses identify only one-year gaps between revenues and spending, while debt
measures the accumulated borrowing of the federal government. Chart 2 shows the debt
totals from 1970 to 2010. This basically shows the same trends as the annual deficit data. The
growing deficits of the 1980’s resulted in higher overall debt. The budget surpluses in the
24
1990’s allowed for debt reduction. The recent high deficits, though, have pushed the overall
debt to record levels.
HOW BIG IS TOO BIG?
Unfortunately, there is no clear answer to this question. Economists generally agree that
government borrowing results in slower future economic growth and that these inefficiencies
grow at an increasing rate. In other words, doubling the government borrowing does more
than double the damage to future growth. While there is no clear consensus on when
government borrowing becomes excessive, economists generally agree that the current levels
of debt and deficits are not sustainable in the long run.
Data on government deficits and debts as a percentage of GDP are shown in charts 3 and 4,
respectively. These charts include data from the members of the Organization for Economic
Co-operation and Development (OECD) countries as well as the average across these countries.
The current U.S. deficits are above average, and second only to Ireland. This implies that our
debt is currently growing faster than our peers. In terms of overall debt, though, the U.S. is
approximately at the average of OECD countries. While this does not imply that our debt levels
are of no concern, perhaps we can take comfort that we are not alone in this struggle.
WHAT SHOULD BE DONE TO REDUCE GOVERNMENT BORROWING?
Pay-As-You-Go Legislation
PAYGO legislation was reenacted in February 2010. This legislation demonstrated success in
providing fiscal restraint through the 1990’s and should have a similar effect into the future. As
the economy recovers, the cyclical component of the deficit should decline; PAYGO legislation
will support this response by keeping the structural deficit from growing during the recovery.
However, the PAYGO legislation essentially locks in any existing structural deficits in the
absence of further adjustments. Thus, while PAYGO will provide fiscal restraint, it will not
directly move the government toward a structurally balanced budget.
Spending Cuts
One option for reducing structural deficits is to reduce the level of government spending. The
big question is where cuts should be made. Historically, elected officials have been hesitant to
propose large cuts to Social Security, Medicare, or Medicaid. These three programs account for
most of what the Congressional Budget Office defines as ‘mandatory spending’ which
accounted for 55% of total government spending in 2010. The other major spending categories
are discretionary defense spending (20%), discretionary non-defense spending (19%) and
interest expense (6%) (Congressional Budget Office, 2011b). The aging of the baby-boomers,
along with rising health care costs, will cause mandatory spending to continue growing based
on current legislation for these programs. Thus, if we are going to address deficit and debt
reduction seriously, it must include cost-saving reforms for these programs as part of the
25
solution. Such reforms are also necessary to improve the financial solvency over the long run,
regardless of the current debates on deficits and debt.
Tax Increases?
The other option for reducing structural deficits is to increase tax revenues. The current
political debate is centered on tax cuts, which would be contrary to deficit reduction in the
short-run2. While tax cuts are politically popular, they are perhaps receiving too much
attention given the growing debt and deficits. As Chart 1 shows, government revenues are at
historically low levels already suggesting that further cuts may not be warranted.
While the political climate currently makes tax increases unlikely, they would provide additional
tools to alleviate the deficit. It is my opinion that all options should be at least considered if we
are to seriously address the deficit.
Policy Changes should be Implemented Slowly
Efforts to reduce deficit spending will require spending cuts and/or tax increases, both of which
cause contractions in the macroeconomy in the short run. If successful, they will reap the
benefits of future growth by eliminating the negative impacts on private borrowing and reliance
on foreign borrowing. Sudden or drastic changes often create overreactions which could send
the economy into another deep recession. In order to minimize the short run disruptions to the
economy, any changes should be implemented slowly and deliberately, allowing consumers and
firms time to adjust to changing economic conditions.
Shifting Focus to Long-Run Stability
The final problem that should be addressed is to learn from the recent macroeconomic
volatility. If we can achieve a structurally balanced budget, the key to sustaining that balance
over the long run is to build up reserves during years with stronger-than-normal growth to
offset deficits experienced in slower-than-normal growth years. The natural problem is that we
tend to be over exuberant during periods of rapid growth. During the rapid growth in the
1990’s, federal and state governments used those cyclical surpluses to fund tax cuts and
spending increases that were simply unsustainable. The prevailing attitude was that we were
experiencing a new era of growth to which the old rules did not apply. The cyclical surpluses
were mistaken for structural surpluses, based on the erroneous assumption that average
annual growth rates had jumped above historical levels.
Thus, to maintain a balanced budget over the long run, we have to resist the urge to increase
spending and cut or rebate taxes during years of strong growth. Such restraint is, of course,
politically difficult but necessary if we are to smooth out the government budget.
2
There is considerable debate on whether tax cuts can stimulate job creating to the point that lower tax rates
eventually cause an increase in tax revenue due to income growth. In the short term, such cuts necessarily
increase deficits. The empirical evidence on the long-run impact is inconclusive.
26
REFERENCES
Congressional Budget Office, 2011a. “Budget and Economic Outlook: Historical Data.”
Available at: http://www.cbo.gov/ftpdocs/120xx/doc12039/HistoricalTables[1].pdf, last
accessed: 4/7/2011.
Congressional Budget Office, 2011b. “Reducing the Deficit, Spending and Revenue Options.”
Available at: http://www.cbo.gov/ftpdocs/120xx/doc12085/03-10-ReducingTheDeficit.pdf, last
accessed: 4/7/2011.
Department of the Treasury, 2011. “Major Foreign Holders of Treasury Securities.” Available at:
http://www.treasury.gov/resource-center/data-chart-center/tic/Documents/mfh.txt, last
accessed: 4/7/2011.
OECD, 2010. “OECD Economic Outlook No. 88 Annex Tables,” Available at:
http://www.oecd.org/document/61/0,3746,en_2649_37443_2483901_1_1_1_37443,00.html,
last accessed: 4/7/2011.
Axis Title
Chart 1: US Government Revenues, Spending,
and Deficits/Surpluses as % of GDP
30.0
25.0
20.0
15.0
10.0
5.0
0.0
-5.0 1970
-10.0
-15.0
Revenues
Spending
Deficit/Surplus
1980
1990
2000
Source: Congressional Budget Office, 2011
27
2010
Chart 2: US Debt Held by the Public
as % of GDP
70.0
60.0
50.0
40.0
30.0
Debt
20.0
10.0
0.0
1970
1980
1990
2000
2010
Source: Congressional Budget Office, 2011
Chart 3: Government Deficits as % of GDP, 2010
15.0
10.0
5.0
Axis Title
-5.0
-10.0
-15.0
Australia
Austria
Belgium
Canada
Czech Republic
Denmark
Finland
France
Germany
Greece
Hungary
Iceland
Ireland
Israel
Italy
Japan
Korea
Luxembourg
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
Slovenia
Spain
Sweden
Switzerland
United Kingdom
United States
Euro area
Total OECD
0.0
-20.0
-25.0
-30.0
-35.0
Source: OECD Economic Outlook, 2010
28
Australia
Austria
Belgium1
Canada
Czech Republic
Denmark
Finland
France
Germany2
Greece
Hungary
Iceland
Ireland
Israel
Italy
Japan3
Korea4
Luxembourg
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
Slovenia
Spain
Sweden
Switzerland
United Kingdom
United States
Euro area
Total OECD
Chart 4: Government Debt as % of GDP, 2010
250.0
200.0
150.0
100.0
50.0
0.0
Source: OECD Economic Outlook, 2010
29