State Economic Watch

Yesterday, this blog featured a new post from the Dallas Fed that discussed the pivot by US battery manufacturers from EV batteries to power storage systems because of sagging EV sales in the US. As if on cue, today's newswires are reporting on the decision by SK Battery America to lay off nearly 1,000, or 37% of its employees, at its plant outside of Atlanta. Key company quote in this AP article : "We are pursuing a range of future customers, including the Battery Energy Storage System arena".

Interesting post from the Dallas Fed Economics team that discusses the impact that the slump in EV auto sales has had on battery production gigafactories. The authors found that the diminished outlook for EV sales growth has led many battery manufacturers to shift their focus from the production of lithium-ion EV batteries to the production of battery energy storage systems. Most of these production facilities are located in the eastern half of the country.

Who knew? A new study from the Radius Sports Group estimates that Wisconsin’s golf industry has a multi-billion impact on the state’s economy. Using data from 2023, Radius estimates that golf has a $3.4 billion direct impact on the state’s economy and a $6.4 billion direct and indirect impact. To put that into context, the most recent estimate by the US Bureau of Economic Research puts the state’s nominal GDP at approximately $478 billion. The glossy eight-page report put out by Radius and the state’s golf industry can be found here .

In another example of the law of unintended consequences, Louisiana crawfish producers are “in dire straits” in the words of one State Representative, because of the shortage of seasonal foreign workers. The US Department of Homeland Security’s restrictions on guest foreign worker visas has reportedly resulted in some of the state’s crawfish processing plants to operate at reduced capacity or to shut down entirely. Louisiana Governor Jeff Landry is pressing the state’s congressional delegation to address the worker shortage issue.

The March 4 edition of the Federal Reserve’s Beige Book contained many of the same sentiments expressed in the previous release. Businesses are generally optimistic but rising costs continue to pressure margins.  Seven of the twelve Federal Reserve District banks reported modest improvement in economic activity. Two reported flat economic activity (Boston and St. Louis) and  three noted modest declines (New York, Minneapolis, and San Francisco). One theme that’s consistent across almost all of the Districts is that of the stressed consumer. Low to moderate income consumers are being particularly squeezed by high grocery, energy, and health care costs, with a notable pick-up in requests for food and housing assistance noted in several Districts. One contact in the New York District noted that even higher income consumers were price sensitive and that they “shopped across multiple outlets to find value”. The stress on consumers appears to be bleeding into auto sales, with most...

A new economic report from the University of Virginia's Weldon Cooper Center for Public Service forecasts state GDP growth of only 0.3% in 2026 compared to a 1.5% increase in 2025. The UVA economists see 2026 as an economic trough for the state however, as their forecast calls for state GDP growth of 1.6% in 2027. They also project 10,300 in job losses, or a decline of 0.2%, in 2026, followed by 0.9% growth in 2027. The state’s unemployment rate is projected to increase to 4.4% by 4Q2026, before declining in 2027. The study's authors expect that payroll declines in the government, manufacturing, hospitality, and arts sectors will be partially offset by gains in the healthcare, construction, and transportation sectors in 2026.