New Home Sales “Lowest Ever,’ But Unemployment Predicted to Drop to Between 9% and 9.2% By Year End
  The economy is in “a self-sustaining recovery” and unemployment will drop to between 9% and 9.2% by year end, according to Federal Reserve Bank of Philadelphia Regional Economist Luke Tilley.
  “Businesses are investing in their future and have been for three straight quarters,” Tilley told 300 local business leaders gathered for the July edition of the Rutgers Quarterly Business Outlook at the Crowne Plaza.
  “The economy is in a recovery mode, albeit a modest recovery” and we’ve been experiencing GDP growth since the middle of last year,” Tilly reported.
  He also noted that more than 600,000 jobs have been added nationally in the last six months, which is good news since “70% of the US economy is made up of consumer spending.” But he added that new home sales are at the 300,000 per year level, which is the “lowest ever.”
  With all that, Tilly was only willing to rate the regional business outlook at 55 (on a 100 point scale.)
  Reporting on the technology sector, Maxine Ballen, the President of the New Jersey Technology Council, was more optimistic, awarding the outlook a rating of 60. She reminded the audience that one-third of all of the drugs produced in the world are produced in New Jersey and that the state ranks 8th nationally in the number of high tech workers, who, in turn, serve the 15,000 high tech companies in the state.
  George Sowa, the Executive VP and Senior Managing Director of Brandywine Realty Trust reported on the commercial real estate industry which has experienced ”negative absorption for 10 consecutive months,” along with “reduced leasing velocity.”
  Citing commercial real estate as typically a “lagging industry” (meaning that it follows rather than leads the economy), Sowa gave the local economic outlook a rating of 15, as he questioned current bank lending and reporting practices. The Brandywine REIT VP got a hearty laugh from the audience when he opined that “a rolling loan gathers no loss.”
  Greg Charbeneau, the Vice President and executive Director of Adventure Aquarium in Camden (the fifth largest in the US) was the most optimistic of the day’s presenters, giving the budsiness outlook a sunny score of 85.
  Reporting on the tourism industry, Charbeneau predicted that “the recession of today is the frugality of tomorrow,” putting his own spin on the oft-cited “new normal.”
  He pointed out that the national fertility rate has fallen 44% since the peak of the Baby Boom and that “smaller household size equals reduced consumer spending.” With all that, he said, the Traveler Sentiment Index registered a healthy 90.4 in May.
  Charbeneau’s venue is 14% below budget for the year, but he attributed that more to the record 96 inches of snow last winter than the economy.
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Photo by Steve Lubetkin
Pictured: George Sowa, Brandywine Realty Trust; Peter R. Spirgel, Flaster/Greenberg PC; Maxine Ballen, New Jersey Technology Council; Luke Tilley, Federal Reserve Bank of Philadelphia; Deborah DiLorenzom, CCSNJ; Raymon Solomon, Rutgers University; and Greg Charbeneau,  Adventure Aquarium.