The Edmond Sun


August 26, 2013

BY THE NUMBERS: State economy shows some signs of strength

EDMOND — It was nearly one year ago that I started writing about “dark clouds on the horizon of the Oklahoma economy.” Then, I was starting to detect in the economic data a significant slowing in the state economy. The good news is that I’m starting to see those clouds finally starting to clear.

The first sign last fall that the state’s economy was slowing from its torrid early 2012 pace came with a steady drop in state sales tax collections. After peaking last summer at a seasonally adjusted level of $161 million per month, state sales tax collections fell throughout the fall and to a low of $156 million per month. Since consumer behavior remains the largest component of the economy (not just in Oklahoma but across the U.S.), this decline in state sales tax collections indicated that a general economic slowdown was occurring.

Within a few months other economic data started to confirm the state economic slowdown. The U.S. Bureau of Economic Analysis reported that Oklahoma’s personal income grew throughout the end of 2012 and beginning of 2013 at one of the slowest rates in the country. Then most recently, the U.S. Bureau of Labor Statistics has reported that the state’s unemployment rate (a metric that is known to lag overall economic activity by 3-6 months) was rising. From April to July the state’s unemployment rate rose from 4.9 percent to 5.3 percent.

In short, the state economy was clearly not as strong as it had been.

In many ways this weakness should not have been a surprise. The state economy had a remarkable run as one of the strongest in the nation for more than two years. From not falling as deeply during the Great Recession as most other states, to recovering much more quickly, some correction was inevitable. When coupled with the highly-publicized struggles from a few of Oklahoma’s most well-known companies, the state economy showed some signs of distress. Still, any economic weakening is concerning.

The good news though is that the latest state revenue data is looking much stronger. This past week the Oklahoma Office of Management and Enterprise Services released the latest state general revenue report — a report that frankly is one of the strongest in the last year. State sales tax collections in July soared to $166 million on a seasonally adjusted basis. While still below last year’s level (if you also adjust for inflation) it is still a significant improvement over the past six months. If this was just a one-month bump it would be tempting to dismiss it as just an aberration. However, July’s strong reading followed smaller improvements in both May and June.

In other words, this strength is starting to look more like a trend.

Far from indicating a return to the high-flying boom years, this slight, yet still significant improvement, likely indicates a return to normal economic growth — growth on par with most other states. Yet even with this normal economic growth, state general revenue collections are likely to be well below levels forecast by the State General Equalization Board. In fact, it’s not inconceivable that state agencies will need to start slashing their budgets in the middle of the year.

The good news is that the hole does not seem to be getting deeper for now. The bad news is that the budget hole caused by the state’s economic weakness the last nine months is going to be hard to climb out of.

MICKEY HEPNER is the dean of the College of Business Administration at the University of Central Oklahoma. Hepner serves on the Executive Committee of the Board of Directors for The Oklahoma Academy.

Text Only
  • Is English getting dissed?

    Is the English language being massacred by the young, the linguistically untidy and anyone who uses the Internet? Absolutely.
    Is that anything new? Hardly.
    Many words and expressions in common parlance today would have raised the hackles of language scolds in the not-so-distant past. For evidence, let’s look at some examples from recent newspaper articles.

    July 31, 2014

  • 'Too big to fail' equals 'too eager to borrow'

    Four years ago this month, President Barack Obama signed the Dodd-Frank Act into law, promising that the 848-page financial law would “put a stop to taxpayer bailouts once and for all,” he said. But recently, Massachusetts Sen. Elizabeth Warren told a Detroit crowd that “the biggest banks are even bigger than they were when they got too big to fail in 2008.”
    Who’s right?

    July 30, 2014

  • Sheltons travel for better life for family

    Some time around 1865 a mixed-race African American couple, William and Mary Shelton, made their way from Mississippi to east Texas. Nothing is known for certain of their origins in he Magnolia state, or the circumstances under which they began their new lives in Texas.

    July 29, 2014

  • Film critic Turan produces book

    Kenneth Turan, who is the film critic for National Public Radio’s “Morning Edition,” has written a book “Not to be Missed, Fifty-Four Favorites from a Life Time of Film.” His list of movies span the gamut from the beginnings of filmmaking through the present day.
    There are some surprising omissions on his list. While he includes two films, “A Touch of Evil” and Chimes at Midnight” made by Orson Welles, and one, “The Third Man,” that Welles starred in but did not direct. He did not however, include “Citizen Kane,” that was the first movie Welles made, that is  often cited by both film critics and historians as a favorite film.

    July 28, 2014

  • Logan County’s disputed zone

    Watchers of “Star Trek” may recall the episode from the original series entitled, “Day of the Dove.” In this episode, Captain Kirk and his crew are forced by a series of circumstances into a confrontation with the Klingons. The conflict eventually resolves after Kirk realizes that the circumstances have been intentionally designed by an alien force which feeds off negative emotions, especially fear and anger. Kirk and his crew communicate this fact to the Klingons and the conflict subsides. No longer feeding upon confrontation, the alien force is weakened and successfully driven away.

    July 28, 2014

  • Russell leads in Sun poll

    Polling results of an unscientific poll at show that Steve Russell, GOP candidate for the 5th District congressional seat, is in the lead with 57 percent of the vote ahead of the Aug. 26 runoff election. Thirty readers participated in the online poll.

    July 28, 2014

  • Healthier and Wealthier? Not in Oklahoma

    Increased copays, decreased coverage, diminished health care access, reduced provider budgets and increased frustration are all the outcomes of the Legislature’s 2014 health care funding decisions. Unlike some years in the past when a languishing state economy forced legislators into making cuts, the undesirable outcomes this year could easily have been avoided.

    July 26, 2014

  • Medicaid reform a necessity

    Historically, education spending by the state of Oklahoma has been the largest budget item. This is no longer the case. In recent years, the state of Oklahoma spends more on Medicaid (operated by the Oklahoma Health Care Authority) than common education and higher education combined, according to the state’s Comprehensive Annual Financial Report.

    July 25, 2014

  • Remembering lessons from 1974

    This week marks the 40th anniversary of an important milestone in America’s constitutional history. On July 24, 1974, the Supreme Court voted 8-0 to order the Nixon White House to turn over audiotapes that would prove the president and his close aides were guilty of criminal violations. This ruling established with crystal clarity that the executive branch could not hide behind the shield of executive privilege to protect itself from the consequences of illegal behavior. It was a triumph for the continued vitality of our constitutional form of government.

    July 25, 2014

  • RedBlueAmerica: Is parenting being criminalized in America?

    Debra Harrell was arrested recently after the McDonald’s employee let her daughter spend the day playing in a nearby park while she worked her shift. The South Carolina woman says her daughter had a cell phone in case of danger, and critics say that children once were given the independence to spend a few unsupervised hours in a park.
    Is it a crime to parent “free-range” kids? Does Harrell deserve her problems? Joel Mathis and Ben Boychuk, the RedBlueAmerica columnists, debate the issue.

    July 24, 2014


The runoff race for the 5th District congressional seat is set for Aug. 26. If the voting were today, which candidate would you support?

Al McAffrey
Tom Guild
     View Results