- Associated Press - Friday, June 3, 2016

PORTLAND, Ore. (AP) - Oregon’s economy is barreling out of the Great Recession-gloom at “full throttle,” with full employment now in sight, wages on the upswing and state revenue gaining at some of the fastest rates in the country, state economists said Friday.

There were some bleak spots - most notably the ongoing erosion of affordable housing - and the rapid pace some areas have been improving aren’t sustainable in the long term, especially as the Baby Boom generation continues aging. But overall, Oregon’s economy wrapped up the first half of the year in sturdy shape.

“Progress is clearly being made. Participation is increasing as the job opportunities remain plentiful and wages are rising,” the Office of Economic Analysis wrote in its second-quarter report. “Full employment in Oregon is fast approaching.”

Oregon’s unemployment rate (4.5 percent), job growth (5,000 per month for the past two years) and gains in wages and personal income (8.5 percent and 6.5 percent, respectively, in the second quarter) all fared better than national averages, as well as the state’s own performance in recent years.

The state’s new minimum wage law - under which the first wage increases begin July 1 - should help low-income workers right away. In the long term, or by 2025, it could cost 40,000 jobs, but state economists say it’s a drop in the bucket compared to the overall market and is more so reflective of a slower rate of job growth than outright job losses.

But housing remains a major problem, they say, especially in metro Portland, where new construction and stronger low-income assistance programs are badly needed to slow the area’s surging living costs.

In a statement, Rep. Mike McLane and Sen. Ted Ferrioli, leaders of the Republican minority party in their respective chambers, took a stab at Democrats by noting that, despite revenue growth, “our ending fund balance is expected to be $57.1 million below previous projections, largely due to overspending by Democrats during the 2016 session.”

That projection-drop was partly due to various financial needs, some unexpected, that came up at the Legislature earlier this year, such as the affordable housing package and air quality monitoring amid Portland’s toxic air crisis. But overall, economists are still expecting a $261 million ending balance to the general fund for the current 2015-17 biennium.

Senate Majority Leader Ginny Burdick defended the spending in a statement.

“Today’s economic and revenue forecast speaks for itself,” Burdick said. “We also are proud of our commitments to refund costs to local communities for fighting wildfires in rural Oregon, responding the Malheur Wildlife Refuge occupation and safety improvements in the aftermath of the tragedy at Umpqua Community College.”

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