Kentucky's economic outlook is for cautious and measured growth over the next year — nearly identical to projections for the nation at large — according to the Center for Business and Economic Research at the University of Kentucky.
Chris Bollinger, a UK economics professor and economic research center director, said he expects gross domestic growth of 2 percent in Kentucky for 2014, with an unemployment rate of 6.5 percent, employment growth of 1.5 percent and manufacturing employment growth of 0.6 percent.
He made the remarks Tuesday during a speech at the annual state economic outlook seminar at the Lexington Convention Center.
National projections call for gross domestic product growth of 2.5 percent, an unemployment rate of 6.5 percent, employment growth of 2 percent and manufacturing employment growth of 0.5 percent.
"Kentucky actually did pretty well right away coming out of the recession," Bollinger told the audience of about 300 Lexington-area business leaders. "Lexington's had a couple of bad years here, but I think we are starting to turn back up."
However, Don Mullineaux, UK's DuPont endowed chair in banking and financial services, stated in a 30-year summary of his work at UK that forecasts are difficult to nail. "We don't know how to predict recessions," he said.
Mullineaux plans to retire from UK later this year.
Bollinger said Kentucky's economic strengths are a diverse industry mix and low operations costs. He said the state's weakness is low educational attainment, particularly at the bachelor's-degree level, where Kentucky lags in the number of science and technology graduates.
Lt. Gov. Jerry Abramson addressed the group to promote Gov. Steve Beshear's tax plan. "Literally every Kentuckian will benefit from the rate-change proposal," he said.
Abramson also championed the proposal to tax services, which would include everything from warranty contracts to downloaded software. Without the tax changes, Abramson said, Kentucky cannot afford to fully fund its education system.
He said having Kentucky offer legal gambling is another key to education funding.
Without both components, he said, "we will not have the kind of educated and competitive workforce Kentucky needs."
In response to an audience question, Abramson said Kentucky has too many counties and separate county governments. The Bluegrass State has 120 counties, the third-most in the nation after Texas and Georgia, states that are much larger in area. ("You can tell I'm not running for governor," he said after his statement.)
Decreasing the number of counties would create efficiencies, he said, but it would be politically and socially difficult.
The Kentucky annual economic report cited several tidbits about the state's economy: Foreign company employment in Kentucky is about 6 percent; the U.S. average is 5 percent. The Kentucky disability income rate is 8.2 percent; the national rate is 4.7 percent.