Oregon's Economy: Overview
Oregon’s economy shadowed the national “Great Recession” that took hold in 2008. The seasonally adjusted unemployment rate for Oregon bottomed out at 5 percent in the spring of 2007 and climbed during the next two years to a near-record high of 11.6 percent. The national unemployment rate fluctuated around 4.5 percent in the first half of 2007 and then climbed to 10 percent near the end of 2009, the highest level seen in decades. Both the Oregon and national unemployment rates fell from their peaks but stayed persistently high. Oregon’s unemployment rate averaged 9.5 percent in 2011, slightly higher than the U.S. unemployment rate of 8.9 percent.
During the past two decades, Oregon made the transition from a resource based economy to a more mixed manufacturing and marketing economy, with an emphasis on high technology. Oregon’s hard times of the early 1980s signaled basic changes had occurred in traditional resource sectors – timber, fishing and agriculture – and the state worked to develop new economic sectors to replace older ones. Most important, perhaps, was the state’s growing high-tech sector, centered in the three counties around Portland. However, rural Oregon counties were generally left out of any shift to a new economy.
As with the nation, Oregon’s expansion from 2004 through 2007 was fueled by growth in construction and services. The recession erased construction’s job gains and devastated the economy to the extent that employment in 2010 was at roughly the same level as in 2000. Job growth since the end of the recession has been slow. The private sector has carried the recovery so far, including growth in private educational and health services, professional and business services, and retail trade. Government job cuts and the lack of recovery in construction and financial activities are contributing to the state’s slow job growth.
Oregon is one of the most trade dependent states in the nation and, to some extent, economic activity in other countries helps drive the state’s economy. The value of exports from Oregon to foreign countries was $18.3 billion in 2011. The state’s largest trading partners are China, Canada, Malaysia, Japan, and South Korea. Of course, Oregon’s trade with other U.S. states far exceeds its trade with foreign nations.
The aging population will factor into the future of Oregon’s economy. The eldest members of the Baby Boom generation are becoming eligible for Social Security benefits, and many are considering retirement. More than one out of five workers in Oregon is already 55 years or older. As the generation ages, employers will need to find new workers with the skills to replace their retiring workforce. At the same time, the growing number of retirees will demand more leisure and health care services.
Oregon's top ten commodities in 2011
(Value in millions)