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<p class="MsoNormal"><span style="color:black">From today’s Yellow Sheet at the capital.</span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><b><span style="font-size:24.0pt;font-family:"Times New Roman",serif">WHAT PANDEMIC-INDUCED RECESSION?<o:p></o:p></span></b></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">October 8, 2020 4:32 pm
<a href="https://yellowsheetreport.com/2020/10/08/what-pandemic-induced-recession-2/#respond">
<span style="color:blue">0</span></a> <o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><img border="0" width="542" height="499" style="width:5.6458in;height:5.1979in" id="Picture_x0020_2" src="cid:image001.jpg@01D69D92.E6B7CE80" alt="download-13"><o:p></o:p></span></p>
<p class="MsoNormal" style="mso-margin-top-alt:auto;mso-margin-bottom-alt:auto"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">A predicted $1.1 billion deficit has turned into a projected $411 million surplus by July 2021, Joint Legislative
Budget Committee analysts announced during today’s meeting of the Finance Advisory Committee. And that’s a conservative estimate, assuming only 2 percent growth for the next eight months of FY21. It’s a far cry from the grim outlook economists had at the start
of the pandemic, and improvements to state revenue come as the state itself has neither cut spending nor spent state resources – beyond a $50 million appropriation at the end of the legislative session – on financial aid or stimulus for struggling Arizonans.
Even as revenues improve, 100,200 fewer Arizonans are employed than were at this point last year. Many of those job losses came from fields like leisure and hospitality, where the average wage for workers is about half the average wage for all Arizona workers,
economist Hans Oloffson said. Workers who received unemployment also had income taxes withheld from their unemployment checks, and the combination of job cuts that disproportionately affect lower-income workers and withholding from higher-than-usual unemployment
insurance mean the state’s individual income tax withholding remains higher than it was in 2019. While higher-than-expected revenue is responsible for much of the state’s good economic news, Ducey’s decision to spend federal COVID-19 relief money on agency
operations also boosted the state’s General Fund. Ducey had great leeway in how he spent much of the $1.86 billion Arizona received from the CARES Act, and at least $300 million of that went to regular agency operations. With federal CARES Act money paying
for day-to-day operations, agencies including the Dept of Corrections were able to send their allocated state money for the fourth quarter of FY20 back to the General Fund. “That’s going to make budgeting decisions easier because we don’t have to engage in
cutting or borrowing,” Ducey budget director Matt Gress said.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Tahoma",sans-serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Tahoma",sans-serif"><o:p> </o:p></span></p>
<p class="MsoNormal">Jeffrey C. Silvertooth, Ph.D.<o:p></o:p></p>
<p class="MsoNormal">Associate Dean<o:p></o:p></p>
<p class="MsoNormal">Director for Extension & Economic Development<o:p></o:p></p>
<p class="MsoNormal">Division of Agriculture, Life, & Veterinary Sciences, and Cooperative Extension<o:p></o:p></p>
<p class="MsoNormal">Forbes 301, Bldg. #36<o:p></o:p></p>
<p class="MsoNormal">University of Arizona<o:p></o:p></p>
<p class="MsoNormal">Tucson, AZ 85721-0036<o:p></o:p></p>
<p class="MsoNormal">520-621-7205<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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