Despite headwinds of high interest rates, lingering inflation fears, and widespread labor shortages, 2024 may bring in slight improvements in some economic measures over the relatively slow 2023 economy here.
One major exception to that, however, is job growth in Spokane and Kootenai counties, which is expected to slow to below 2% next year after coming in at a higher-than-anticipated growth rate of 2% for 2023.
While the information-technology hiring frenzy has slowed since 2022, some job growth still is anticipated in the tech sector in the coming year, as artificial intelligence applications become more ubiquitous.
In the construction industry, labor shortages and rising costs of building have been major factors to a slowdown of Spokane-area construction this year, and these conditions are expected to continue into 2024.
Infrastructure projects at the state and local level and private multifamily projects have kept some commercial contractors busy, but labor shortages may be exacerbated in 2024 with apprenticeship utilization requirements mandated by the state beginning in July.
Some transportation project contractors are concerned that the state Department of Transportation doesn’t currently have new projects slated to go out to bid here in 2024.
Residential construction hasn’t kept up with demand, and homebuyer affordability likely will remain a challenge.
Rising interest rates, along with elevated sales prices, slowed down the residential real estate market, but some officials hope interest will stabilize and buyers with pent-up demand will return to the market.
Home prices have remained elevated, with the November median sales price topping $407,000, a 3.2% increase compared with the year-earlier month, providing little relief, especially for first-time homebuyers, going into the new year.
Kootenai County saw some economic growth in 2023, and the same is expected in 2024.
Construction on ongoing and planned commercial and transportation projects there will continue into the new year with several highly visible projects progressing in Post Falls, including retail, restaurant, and industrial buildings and the Idaho Route 41/Interstate 90 interchange.
While some high-end housing projects are going up in Coeur d’Alene, the elevated market value for residential real estate continues to raise challenges in developing attainable housing.
Inland Northwest bank and credit union representatives have observed a slowdown in deposits as customers are drawing from their savings, and current interest rates are slowing loan demand. However, the Federal reserve has indicated it may be done raising interest rates as inflation may be stabilizing going into 2024.
Retail sales growth has slowed, but not as much as expected, possibly due to the strength of wages in the tight labor market. With personal income expected to increase an average of 5% statewide, that could continue to buoy retail sales next year.
The current cost of credit, however, could present hurdles for large purchases, such as automobiles.
Restaurants are facing increased costs and a labor shortage, and restaurant closures are expected to continue due to lingering fallout from the COVID-19 pandemic.
Spokane’s tourism sector is expected to see a bit of growth in the coming year, although it will still have a way to go to reach pre-pandemic levels.
Sporting events, for example, are expected to draw 117,000 visitors in 2024, up from the previously projected 113,000 visitors for 2023, and 55 groups have been contracted for conventions for 2024, up slightly from groups contracted a year ago for 2023.
Major health care providers expect to continue to take on losses in 2024, but at a slower rate than during the past two years as they address challenges of wage inflation, rising costs, payer denials, and more timely moving of patients to less-expensive care.
The outlook for agriculture will depend largely on winter and spring precipitation to improve growing conditions, which were dry during fall plantings.
In addition to rising production costs creating challenges, high export costs have reduced international demand for Pacific Northwest wheat.
Many farmers have put off buying new equipment due to the current cost of borrowing and are waiting for improved harvest and lending conditions to take out loans.
Mining activity is expected to increase in North Idaho in 2024 after mixed results this year.
Idaho Strategic Resources, for example, is expecting its second consecutive profitable year for gold production at its operations near Murray, Idaho, in 2024. Hecla Mining Co. expects to resume full production at the Lucky Friday silver mine near Mullan, Idaho, after a mine shaft fire suspended operations there earlier this year.
Toronto-based Bunker Hill Mining Corp. reports it’s on track to restart production at the historic Bunker Hill silver, lead, and zinc mine in Kellogg, Idaho, in late 2024.
Subscribe today to our free E-Newsletters!SUBSCRIBE