The once-bright economic outlook for Idaho that caused Gov. Cecil Andrus to predict "an outstanding year" in 1991 is turning sour, and state economists fear the picture could darken even more.
The latest forecast, issued by the Division of Financial Management, marked the first time since the current economic boom began more than two years ago that state analysts scaled back their projections for expansion through the near term.Personal income, farm profits, non-agricultural employment and job opportunities in nearly every sector were on an upward spiral with each succeeding forecast issued in the past.
But they all took a downturn in the fall revision. That caused similar reductions in expected population growth, particularly through people moving in from other states.
The magnitude of Idaho's slowdown was not as great as the decline anticipated nationally, analysts said, because "Idaho is entering the current national economic slowdown from a position of strength."
But they also conceded their forecast was based on the probability that the nation would not slip into a recession during the next two years. Data Resources Inc., which provides national economic projections, has steadfastly ignored past predictions of recession from other experts.
But now it has reversed itself to predict a recession, albeit shallow, "to start this fall and last until oil prices decline" sometime next year.
"The question no longer seems to be whether there will be a recession in the coming year, but, instead, how severe will the recession be," analysts acknowledged.
Officials publicly maintain the state is currently unaffected by economic problems spreading through the national economy. Still, the signs of slowdown were multiplying.
Residential construction activity dropped significantly in September, commercial construction was off, consumer loan delinquencies were up, non-farm employment opportunities contracted and silver prices hovered near 14-year lows.
But even though the outlook has dimmed, analysts said there was still the anticipation of growth, even if modest.
Recent history could prove them right. Idaho was experiencing similar growth during the early 1970s that pushed its economy through the 1974-75 national recession relatively unscathed. But seven years later, the Idaho economy had already been contracting for more than 12 months when the recession of 1981-1982 struck the nation.
That plunged the state into one of its worst downturns ever, and the economy did not even begin to pull out until three years ago.
Although retrenching from their past optimism, state analysts remained confident Idaho's economic performance would continue to outpace the nation's as it had since the current resurgence began. Operational changes in the key resource industries, made during the hard times of the 1980s, have made those sectors much more resilient to economic upheaval.