Kurt Rankin, an assistant vice president and economist for The PNC Financial Services Group, speaks to invited guests at the PNC Bank's annual luncheon at the Pinnacle in Maumee.
The U.S. economy is a "tinderbox" of financial fuel simply awaiting a spark, an economist with Pittsburgh-based PNC Bank told an audience of about 300 Thursday in Maumee.
But Toledo's economic recovery may take longer than elsewhere in the nation because the region must climb out of a bigger hole, argued Kurt Rankin, an assistant vice president and economist with PNC Financial Services Group.
"I call it a ‘tinderbox' recovery. Businesses are flush with cash, and all we need is a risk-taking spark," Mr. Rankin told the audience at The Pinnacle. "Once that spark hits, all that money that's sitting on the sideline is going to go up very quickly."
Mr. Rankin, who joined PNC last year after 10 years with Moody's Analytics, said wavering consumer confidence is holding back an economic recovery in the United States far more than anything else. Businesses are ready to expand if they see increased demand for their goods and services, but so far the consumer spending that makes up 70 percent of the national economy is holding relatively steady as consumers save their money and avoid spending for fear of losing their jobs, he said.
"When U.S. consumers aren't spending, they're saving. Unless businesses see new revenue coming through the door, they're unwilling to hire new workers," the economist said. However, he said falling worker productivity is likely to force businesses to begin hiring soon. "This economy is operating on a skeleton crew."
Mr. Rankin said the hard hit endured by metro Toledo during the 2007-2009 recession will take some time to recover from. While the national economy is just returning to the level of activity it had before the Great Recession started four years ago, metro Toledo's recovery will take longer as it searches for industries to replace the thousands of automotive sector jobs lost during the downturn.
"Toledo has a tough slog ahead of it, but it's certainly not alone," he said, noting regions such as Detroit, Chicago, and south Florida are experiencing similar circumstances.
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