“Oklahoma is better equipped to handle the tough economic times ahead than the rest of the nation,” said Mark Snead, director of the Center for Applied Economic Research at OSU.
During these tough economic times, Oklahoma should weather the national storm better than other states, said Mark Snead, director of the Center for Applied Economic Research.
Snead said there are two reasons why Oklahoma should outperform the rest of the nation.
“The first is that [Oklahoma] has a lot of momentum as a state going into the slowdown, and the second is that we think we’re still getting a boost in the energy sector,” he said.
However, Snead said oil and natural gas prices will have an influence on how Oklahoma’s economy performs.
Snead said economists think reaching prices of $45 to $50 a barrel is the critical point for the state.
He said if oil falls to around $35 a barrel and natural gas falls to around $5 a barrel, it will slow the state’s economy.
“Right now we’re around $55 per barrel and we think there’s some energy boost there,” he said. “But if we fall to $35 oil and $5 natural gas, not only will there not be an energy boost, but there will be a restraint on activity in the state that exerts a drag on the state economy.”
Despite the prediction that Oklahoma will do better than other states during the crisis, Snead said the state will still face problems caused by the national situation.
Many of the repercussions will be seen in the job market.
“We are looking for a pretty much across the board slow down,” Snead said. “There will be layoffs — there’s no doubt about it.”
Problematic areas include manufacturing and temporary positions. Snead said it still isn’t certain how financial positions will fare.
About the only industry Snead said will not slow down is health care.
Still, Cara Ferrell, assistant director of career services, said they have yet to see a slowdown.
She said that 76 companies have already signed up for the spring career fair, which is the average.
“So far we have not seen a decline and we are very fortunate in that regard,” Ferrell said. “December and May graduates should not be affected.”
It takes a while to know what is going to happen because they set recruiting goals a year in advance, but so far career services hasn’t seen a decline, Ferrell said.
Snead said, though, it will be a tough year for college students.
There probably won’t be as many opportunities, he said.
“It will be a good time to show more flexibility as far as pay demands and working conditions,” he said. “This is a time to be concerned about getting your foot in the door.”
Michael Clark, a history senior, said that he is not concerned about looking for a job.
He said that he knows there will be jobs.
“I’m not too concerned about it, though, because there are still jobs that need to be done,” he said. “There are still plenty of normal, entry-level jobs.”
As far at the national economic outlook, Snead said the U.S. economy is unlikely to respond in the next 90 to 120 days.
He said the country is in for a weak 2009, but Oklahoma is a different story.
“We have so much momentum and because we have the energy boost, we’re about a year behind in the cycle,” he said. “I think if this does resolve itself in the next 12 months, Oklahoma has a good chance of making it through this without severe damage.”
However, if the recession continues through 2010, this is when Oklahoma will face more severe problems, Snead said.
If oil and natural gas prices remain weak, 2010 will be a risk for us, he said.
“If we’re going to have a rough down year if energy prices continue to stay low, it will be 2010,” he said.
