Research Seminar in Quantitative Economics

University of Michigan Ann Arbor, Michigan

734-764-2567

George A. Fulton, Director

rsqe.econ.lsa.umich.edu
For Release: 11/16/2012
9:30 A.M.

Saul H. Hymans, Director Emeritus

The Michigan Economic Outlook for 20132014

Joan P. Crary, George A. Fulton, and Donald R. Grimes
University of Michigan
I.

Introduction

For many reasons, its not hard to feel upbeat about the Michigan economy. Were nearly three
years into a solid economic recovery after almost a full decade of recession. Michigan is frequently
referenced in news stories touting its strong standing among other states in job growth and other
economic performance characteristics based on the data index or survey du jour. Our signature auto
sector has been strong throughout the period, and one of Michigans weakest major sectors, housing, is
now showing signs of turning around. In general, the highest wage sectors have recorded the most
rapid growth over the recovery period. And the unemployment rate, which was in the 14 percent range
at the end of 2009, is now around 9 percent. Most important, the fundamentals seem to be in place for
the economy to keep expanding.
For other reasons, its hard not to feel a little disappointed as well.

The rebound from the

recession has not been nearly as robust as most past episodes of recovery, and growth recently has
been particularly sluggish. Some sectors such as retail trade are having trouble getting out of first gear,
and the government sector is stuck in reverse. Although the unemployment rate has come down
significantly during the recovery, it remains historically high, and even at that it doesnt represent the full
RSQE RESEARCH FACULTY
Joan P. Crary
Saul H. Hymans
George A. Fulton
Daniil Manaenkov
Donald R. Grimes

PROGRAM COORDINATOR
Louise Reed

The Michigan Model

RSQE RESEARCH STAFF

Shannon Ackley
David E. Hetrick
Vanessa I. Alviarez Jacqueline R. Murray
Matthew G. Hall

2
extent of labor underutilization in the state.

Recently, the jobless rate reversed its hope-inspiring

downward trend and has floated back up to its reading of last December.
For yet more reasons, its hard not to feel downright troubled. If we switch perspective and
measure progress not from the trough at the end of 2009, but instead from the economic peak in mid2000, we then bring into the conversation the deep hole created in the first decade of the 2000s, and
the question of how far we have come in extricating ourselves from that hole.

The news is not

encouraging: since the recovery in jobs that began three years ago, the state has regained only onefifth of the jobs that had been lost since mid-2000. Over the same period, the states workers have also
lost considerable ground to the nation on wage levels. Its a long haul to crawl out of a deep holebut
at least weve stopped digging in deeper.
In this report, we will examine the states employment and wage situation from a longer-term
perspective, and also consider some of the broader measures of labor underutilization. Our main focus
as always, however, is on our two-year forecast.

The more forward-looking questions about the

recovery, such as whether it will be sustained over the next few years, how robust it will be, and the key
industry contributors to our economic health, are all addressed in the forecast section of the report, as
are the state revenue implications.
Before considering our perspective on how the Michigan economy will evolve over the next two
years, we first take a look at 2012, to learn more about what kind of year it has been and to gauge how
well we anticipated this years developments at last years Economic Outlook Conference.

II.

Review of the Forecast for 2012

Today marks the forty-first presentation on the outlook for the Michigan economy since the State
of Michigan and the university administration requested these forecasts in the early 1970s to assist in
their respective planning efforts. The track record for each of the previous forty forecasts is set forth in
summary form in Table 1.

3
Table 1
Review of RSQE Forecast of Employment and Income
in the State of Michigan
Percent Change in Michigan
Wage and Salary Employment
Year

1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
1

RSQE1
Forecast
4.6
1.5
1.3
3.4
2.1
2.8
0.6
2.5
2.2
0.9
1.0
5.5
2.6
1.3
1.8
0.3
1.8
1.3
0.4
0.7
0.3
1.1
2.1
1.6
1.6
1.2
1.4
1.4
0.5
0.6
0.3
0.8
0.8
0.2
0.7
1.7
3.0
2.2
0.2
0.8

Percent Change in
Michigan Personal Income

Observed

RSQE1
Forecast

Observed

5.4
0.2
4.3
4.7
4.8
4.8
0.8
5.3
2.3
5.1
0.9
4.9
5.3
2.7
2.1
2.2
2.7
0.6
1.6
0.9
2.0
3.6
3.1
2.0
2.0
1.7
1.6
2.0
2.4
1.7
1.6
0.4
0.2
1.4
1.4
2.5
7.1
0.2
2.0
1.32

9.6
7.4
5.8
12.7
11.4
11.2
8.3
6.1
10.8
7.1
7.0
11.3
8.0
4.8
3.8
3.7
6.4
6.0
5.0
5.1
4.9
4.7
6.4
4.6
5.1
4.8
3.5
5.2
4.6
2.3
3.5
4.9
4.7
4.9
3.3
1.6
0.7
1.0
2.0
3.0

12.3
7.2
6.4
12.6
12.6
11.2
10.0
7.0
7.1
3.0
5.8
10.6
8.4
6.3
3.5
6.2
7.4
4.2
3.2
6.4
5.0
8.0
4.5
4.5
4.9
6.5
4.1
6.1
2.5
1.0
3.7
1.6
2.0
2.8
2.8
2.0
6.3
3.1
5.6
3.82

Forecast presented at the Economic Outlook Conference of the preceding year.

Estimated by RSQE as of November 2012.

4
At last Novembers Economic Outlook Conference, we foresaw correctly that in 2012 the Michigan
economy would continue its recovery, but at a more subdued pace than occurred in 2011. Based on
the data we were working with at this time a year ago, we forecast that growth would back off in 2012 to
the 0.8 percent rate reported in the last line of the table. With one quarter of data yet to come, our
current estimate is that employment will register a 1.3 percent increase for 2012, half a percentage
point higher than what we forecast a year ago.

It is productive to seek out the sources of our underestimate, and we do so by consulting the
underlying industry data. We find that most of our underestimate of job growth is in two sectors:
manufacturing, and professional and business services.

Consistent with our underestimate of job

creation for manufacturing, we were too light on our forecast of both U.S. vehicle output and total light
vehicle sales, and due to the latter, we were too bearish as well on Detroit Three vehicle sales.
Offsetting this to some degree, we were a little too high on the Detroit Threes market share of total light
vehicle sales.

Much of the shortfall in the employment forecast for the professional and business services sector
stems from the interconnectedness of many of its constituent industries with the manufacturing sector,
whose strength we underestimated. Also, the strengthening local economy overall resulted in a more
favorable commercial environment.

On the income side of the ledger, we were also too pessimistic. Based on the data available as of
last November, we forecast a significant slowing in personal income growth, from the rate then of 5.8
percent for 2011 to 3 percent in 2012, a difference of almost 3 percentage points. The rate for 2011
has since been revised down slightly, to 5.6 percent, and our current estimate for income growth in
2012 is 3.8 percent, as shown in the bottom line of Table 1a difference of not quite 2 percentage
points. So, again, we were correct in anticipating a significant slowing in income, but we overshot the
drop.

5
Most of the forecast error in personal income can be traced to two factors. First, and most
important, we underestimated growth in the wage and salary disbursement component, the result of
being too light on both employment growth and earnings per worker. Much of the reason we were too
low on earnings per worker is that our largest underestimates of employment were in higher-wage
industries.

Second, we were also too low on the labor-related components of nonwage income, in particular
other labor income and proprietors income.

This review gives us a broad picture of a state economy that continues its upward trajectory in
2012, but that has also cooled off a bit from its pace of a year ago. Before we explore developments
beyond 2012, we need to take a more detailed look at the current state of the economy, and we turn to
that now.

III.

Current State of the Economy

Michigan is about to register its third consecutive year of recovery following a nearly decade-long
recession.

To better understand where the economy sits at the launching point for our 201314

forecast, we will examine the current recovery in a longer-term context, as we have done in previous
reports. This time, we explore employment and wage movements in Michigan among a range of
establishment size classes, over both the most recent recession and the current recovery to date. The
purpose is to gain some insight into the comparative situations of smaller and larger businesses over
phases of the business cycle, and to learn where the state economy is now positioned as it prepares to
continue moving forward, eleven years after the initial stages of what evolved into the most severe
downturn in memory.

With growing employment over the past three years, the state unemployment rate has fallen
substantially over that interval, but still remains stubbornly highand the official rate does not reflect
the full extent of labor underutilization in Michigan. As this is a primary source of discontent among the

6
public despite the growing economy, we also consider in this section alternative measures of underemployment and identify some of the demographic groups that are overrepresented in those measures.

Following that, we focus on 2012 to take a closer look at whats been happening so far during the
year, concentrating this time on our more traditional employment breakout by major industry grouping.

A. Past and Present Employment and Wage Movements by Establishment Size

For our profile on Michigans employment and wage behavior by establishment size, we
assembled a data set from the Quarterly Census of Employment and Wages (QCEW) published by the
Bureau of Labor Statistics, and then compiled series on both private-sector employment and wages by
four establishment size classes for both Michigan and the nation.1 The data on establishment size are
available only for the first quarter of each year, and we selected the first quarters of 2001, 2010, and
2012 for our analysis.

We start by noting a few additional limitations on these data. First, the data are by establishment,
not by firm, and a firm can have more than one establishment. Second, the self-employed are, by
definition, not included in the establishment data, and would be predominantly in the smallest size class
if they were. Third, and perhaps most important, the dynamics over time in employment or wages
within a size class include both growth (or shrinkage) of establishments in that class and movement of
establishments across classes. Both effects are in play, and it is not possible to isolate them, but there
are lessons to be learned from the data nonetheless.

The private-sector employment distribution among the four establishment size classes are shown
for the first quarters of 2001 and 2012 in Table 2. First, it can be noted from the second column of data
that Michigans employment share in the first quarter of 2001 was fairly evenly distributed among the
four size classes, and more evenly distributed than in the nation. Second, Michigan had a much
greater share of employment in the largest establishments (those with 500 or more employees) than did
1

The four size classes are 1 to 19 employees, 20 to 99, 100 to 499, and 500 or more.

7
the nation at that time (24
percent versus 18.9 percent),
and a correspondingly smaller
share in the two smallest size

Table 2

Private-Sector Employment Distribution by Establishment Size

Michigan and the United States
First Quarters of 2001 and 2012

employees). By the first quarter

First Quarter 2001

First Quarter 2012
Mich. U.S.
Mich. U.S.
Establishment
Emp. Emp.
Emp. Emp.
Mich.
Mich.
Size
Employment Share Share Employment Share Share
Intervals
(%)
(%) (Thousands) (%)
(Thousands) (%)

of 2012, Michigans employment

Total

categories (those under 100

100.0 100.0

3,265.8

100.0 100.0

835.3

22.1

25.0

785.4

24.0

27.2

20 to 99

1,023.6

27.1

29.6

904.4

27.7

30.6

category fell substantially, from

100 to 499

1,017.1

26.9

26.4

908.8

27.8

25.5

24 percent to 20.4 percent.

500 or more

907.9

24.0

18.9

667.2

20.4

16.6

share

in

the

largest

size

1 to 19

3,783.9

RSQE: November 2012

Although

Michigan

remains

more big-establishment heavy than the United States, its employment concentrations did shift toward
the smaller establishments over the eleven-year period.

The next table reveals the dynamics behind Table 2. The employment change by size among
establishments is shown over the eleven-year period in Table 3, divided into the interval from the first
quarter of 2001 to the first
Table 3

quarter of 2010 to represent the

recession in Michigan, and the

Private-Sector Employment Change by Establishment Size

Michigan and the United States
First Quarters of 200110 and 2010 12

interval from the first quarters of

2010 and 2012 to represent the
current

recovery

period.

lost

724,100

Michigan

Job Change
First
Quarters
200110
Establishment
Size
Mich.
Mich. U.S.
Intervals
(Thousands) (%)
(%)
Total

Job Change
First Quarters 201012
Mich.
Mich. U.S.
(Thousands) (%)
(%)

724.1

19.1

4.4

206.1

6.7

4.1

establishment jobs in the earlier

1 to 19

57.9

6.9

6.4

7.9

1.0

1.9

interval, with the largest losses

20 to 99

162.0

15.8

1.3

42.8

5.0

4.3

100 to 499

174.7

17.2

8.5

66.5

7.9

5.2

500 or more

329.5

36.3 17.7

88.8

15.4

6.1

showing

up

establishment

in

the

size

largest
category,

RSQE: November 2012

8
which dropped by 36.3 percent compared with an overall job loss of 19.1 percent. Indeed, employment
in the largest size category fell by more than one job in three over the period (329,500 out of 907,900
jobs in that category), making up just under half of the total job loss over the interval (329,500 of the
724,100 jobs lost). Correspondingly, the smaller size categories did relatively better over the earlier
period in Michigan, posting a smaller, yet nontrivial, pace of decline. The job loss for the United States
over the size classes was much less pronounced: the largest category, which took the brunt of the
losses, was down by 17.7 percent, and the smallest category actually gained jobs.

The mirror image pattern emerges during the state recovery from the first quarters of 2010 to
2012. The largest gains in Michigan show up in the largest establishment size category, allowing it to
creep up from an 18.9 percent employment share in the first quarter of 2010 (not shown in the table) to
20.4 percent two years lateran improvement of 88,800 jobs (15.4 percent) compared with an addition
of 206,100 jobs (6.7 percent) overall.

The largest size category expanded much more rapidly in

Michigan than in the United States during this period; thus, Michigan remains more top-heavy in the
largest establishments compared with the nation. To repeat: this expansion in the largest size class
reflects the likely net movement of smaller firms into larger size categories, in addition to job growth
within the largest categories.
Table 4

This may explain the more

modest

growth

among

Private-Sector Annualized Wage by Establishment Size

Michigan and the United States
First Quarters of 2001, 2010, and 2012

the

smaller establishments.
Annualized Wage ($)
First Quarter
First Quarter
2010
2012
Mich.
U.S.
Mich.
U.S.

Establishment
Size
Intervals

First Quarter
2001
Mich.
U.S.

Total

38,532

37,436 41,628

46,257

47,465

51,541

1 to 19

30,071

30,060 34,081

36,688

37,393

40,169

the eleven-year period 2001q1

20 to 99

32,972

32,945 37,837

40,540

41,867

44,616

to 2012q1, as shown in Table 4.

100 to 499

37,404

38,493 43,208

48,879

49,008

54,503

500 or more

53,847

52,739 55,116

69,262

64,805

78,414

We
wage

also

behavior

investigated
among

the

establishment size classes over

In 2001q1, annualized wages

RSQE: November 2012

9
for establishments in Michigan and the United States were much the same, although Michigan was
slightly higher in most size classes and exceeded the nation among all classes by 2.9 percent ($38,532
versus $37,436). In both Michigan and the United States, average wages increase monotonically with
increasing size of class.

By 2012q1, wages in every size category are substantially lower in Michigan compared with the
nation, and they are lower overall by 7.9 percent ($47,465 versus $51,541).

The ground lost by

Michigan in the largest size class is not surprising, considering the retrenchment of the high-wage auto
sector and related industries over the period.

In 2001q1, the annualized wages in Michigan for

establishments with 500 or more employees were 2.1 percent above the U.S. average ($53,847 versus
$52,739); eleven years later, wages were 17.4 percent below the national average ($64,805 versus
$78,414). Less visible is that the lost ground on wages has permeated the smaller establishments as
well.

The slower growth in total wages in Michigan compared with the nation conceivably could reflect
both slower wage growth in the state within size categories, and the larger reduction in the share of the
largest establishments that on average pay the highest wages. On the other hand, shift-share analysis
suggests that almost all of the relative loss reflects the comparatively slower growth in wages within
each size category, and not shifts in composition among categories.

What are the take-aways from this analysis? We suggest that there are four main points:

1.

Over the past eleven years, the smaller establishments (those with fewer than 500 employees)
have become a larger share of the work force in both Michigan and the United States.

2.

During the first two years of recovery from the extended Michigan recession, the largest
establishment size category has gained the most ground in Michigan, both because of growth
among establishments in that category and because of smaller firms moving up into that category.

10
3.

It remains to be seen whether the retrenchment and restructuring of some of the key large
establishments in Michigan, many of them auto-related, will translate into permanently larger
shares for the smaller establishmentsor whether cyclical movements will transport the work
force to business size configurations more similar to those seen at the end of the past expansion.

4.

With respect to wages, Michigan has lost significant ground to the nation over the past eleven
years. This reflects slower wage growth in all of the establishment size classes analyzed here.

B. Labor Underutilization

Another important element of the labor market in Michigans current recovery is the status of the
unemployed. What is clear is that with the expanding economy over the past three years, the officially
measured state unemployment rate has dropped significantly, from a calendar-year average of 13.4
percent in 2009 to 10.3 percent in 2011, and by our estimate, to 8.9 percent in 2012. The recent rates
are still historically high, however, and more to the point in this section, do not reflect the extent of labor
underutilization in the state. In other words, the official, or so-called U-3, measure of the unemployed
excludes residents not officially in the labor force who nonetheless desire work, or who are in the labor
force and desire more work.
Chart 1

We

provide

measure of the magnitude of

these groups in Chart 1, which
shows for calendar-year 2011
estimates of how much the
official
would

unemployment
have

increased

Alternative Measures of Labor Underutilization

Michigan, 2006 and 2011

some

rate
by

20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%

18.8
2006

2011

7.0

U-3

12.3

11.1

10.2
7.4

8.3

U-4

U-5

categories

of

underutilized

U-6

U-3: Comparable to the official unemployment rate (6.9% in 2006, 10.3% in 2011)
U-4: Unemployed (U-3) + discouraged workers

including in turn three additional

12.0

U-5: U-4 + all other marginally attached workers

U-6: U-5 + employed part-time for economic reasons
RSQE: November 2012

11
labor. The U-3 measure for 2011 is 10.2 percent, 0.1 percent lower than the official rate, a difference
that can be written off to arithmetic. We now include in turn the measures for U-4, U-5, and U-6.

When discouraged workers are added to the U-3 measure, forming the U-4 measure, the labor
underutilization rate moves up from 10.2 percent to 11.1 percent. Discouraged workers are people who
are not currently looking for work because they believe that there are no jobs available for them. This
group in Michigan is disproportionately young and male.

The U-5 measure, which adds to the U-4 measure the category all other marginally attached
workers, yields a 12.3 percent rate of labor underutilization. These other marginally attached workers
are people who want a job and have searched for work sometime in the prior year, but have not looked
for work in the past four weeks for reasons such as family responsibilities or transportation problems.
This group in Michigan incorporates youth disproportionately to their share of the population.

The largest addition comes when part-time workers who would prefer to work full-time are
included, spiking the labor underutilization rate to 18.8 percent. The distribution of these involuntarily
part-time workers in Michigan is tilted toward females.

It should be noted that this pattern of labor underutilization is not unique to times of higher
unemployment, but also occurs in periods with lower unemployment. An example, shown in Chart 1,
would be six years ago in 2006.

We now turn to looking at 2012 to see whats been happening to employment so far during the
year, this time focusing specifically on the major industry groupings.

C. The Michigan Economy in 2012

Michigans labor market continued to recover during 2012, but in a strikingly uneven pattern,
according to the current data on establishment employment. The Michigan economy came in like a lion
at the start of 2012, adding 29,700 jobs in the first quarter, growth at a robust but unsustainable annual

12
pace of 3 percent. Over the following spring and summer quarters, job growth ratcheted back greatly to
a much more subdued annual rate of 0.5 percent, a gain of 9,700 jobs over the two quarters based on
preliminary data for the third quarter. The states job growth is similar to the national pattern so far this
year, and also traces a path similar to the surge-and-pull-back trajectory that occurred in the state in
2011although in neither case is the contrast between the two intervals as pointed as for Michigan in
2012. Initial indications are that there will be some upward revision in the establishment employment
numbers for 2012 when they are put through the annual benchmarking process early next year.

The top job producers so far during 2012 are concentrated in six industries: (1) motor vehicle and
parts manufacturing, 12,400 jobs; (2) professional, scientific, and technical services, 8,400; (3)
accommodation and food services, 6,600; (4) nonvehicle durable manufacturing, 6,200; (5) health and
social services, 5,000; and (6) finance and insurance, 4,400. The dominant supersectors this year, as
they were last year, are manufacturing, led by the auto industry, and professional and business
services, led by the professional, scientific, and technical services industry. Both of these industries are
among the most highly compensated in the Michigan economy. Together with some of the other
industries on the list of top job producers, they contribute to the continuing strength in the higher-wage
segments of the economy during the current recovery.

Several industries have shed jobs so far during 2012, in particular: (1) local government, 5,500
jobs; (2) retail trade, 5,200; (3) construction, 3,200; and (4) other services, 2,100. Local government
continues its downward trend as it adjusts to the stringent budget realities it now faces. The losses in
retail trade reflect the industrys ongoing change to a less labor-intensive way of carrying out its
business.

The near-term prospects for construction seem to be more favorable.

The loss of

construction jobs, on the other hand, may reflect an abnormally high level of construction activity during
the mild winter months around the turn of the year. Also, recent data on the local housing market,
including statistics on statewide residential building permits, suggest that it might have begun to turn
around. Indeed, the construction sector added 1,700 jobs in the third quarter.

13
Going forward, the prospects for the Michigan economy depend on the ability of the national
economy to gain some momentum over the next two years. Before we offer our perspective on the
final quarter of 2012 and the two years that follow, we first turn to a brief review of the national and local
input assumptions that influence our forecast for Michigan through 2014.

IV.

Inputs to the Forecast

Our Michigan forecast depends on the overall health of the national economy, national economic
policy, and a set of assumptions specific to the state model. Major elements of our national forecast
include the following:

In September, the Federal Reserve announced another round of quantitative easingthe

purchase of an additional $40 billion per month of agency mortgage-backed securities. More
important, the Fed modified its forward policy guidance to commit to highly accommodative
monetary policy for a considerable time after the economic recovery strengthens, and indicated
that the federal funds rate would likely remain low through mid-2015. In our forecast, it remains
below 0.25 percent at least through 2014.

The 3-month T-bill rate stays below 20 basis points throughout the forecast. The 30-year
conventional mortgage rate climbs slowly to 3.7 percent by the end of 2013 and reaches 4.1
percent by the close of 2014.

The national elections did not significantly shift the balance of power, leaving many of the same
parties responsible for dealing with the significant short- and long-term federal budget issues on
the horizon. On the spending side, Congress agreed to a six-month continuing resolution funding
the federal government at roughly fiscal 2012 levels through March of next year. On the tax side,
however, either the lame duck session will agree on which expiring tax cuts to extend or else the
incoming members of Congress will have to pass new cuts to avoid the fiscal cliff. We assume
that the payroll tax cut will expire at the end of 2012, and that the Bush-era income tax cuts, or an
income tax cut of equivalent size, will be maintained along with temporary cuts to the Alternative
Minimum Tax. We forecast slow growth of federal expenditures over the next two years and
modest tax increases in 2014 as a result of bipartisan desire to reduce the federal deficit. On a
National Income and Product Accounts basis, the federal deficit decreases from $1.1 trillion in
fiscal 2012 to about $740 billion in fiscal 2014.

The price of West Texas Intermediate crude oil (WTI) has fallen off its late summer recovery to
hover below $90 per barrel. Surging domestic production, combined with limited pipeline capacity
to alleviate record high inventories, has put upward pressure on the spread between domestic
and international blends of crude. The quarterly average price of WTI is projected to bottom out
in the beginning of 2013 at $87 per barrel and then to rise slowly, inching up to $88 per barrel by
the end of 2013 and $91 a year later.

14

We project output growth to follow an uneven path throughout our forecast horizon. Real GDP
slows this quarter but then accelerates to average 2 percent in 2013 and an improved 2.7 percent
in 2014. In each year, expansion slows early due to assumed tax increases and then rebounds in
the second half. Slow growth in disposable income holds consumer spending to a modest 1.9
percent growth rate in 2013 before stepping up to a healthier 2.3 percent gain in 2014.

Light vehicle sales and residential building grow quite strongly throughout the forecast; light
vehicle sales reach 15 million units in 2013 and grow by another 600,000 units in 2014, while
housing starts come up off the floor to register over one million in 2013 and almost 1.4 million in
2014.

Business capital spending grows modestly after several slow quarters in 2012. Combined
government purchases fall in real terms over most of the forecast period, but the rate of decline
slows as government units make progress on reducing their deficits.

Payroll employment rises by 2.0 million jobs during 2013 and 2.3 million during 2014 (4th quarter
to 4th quarter), after a projected gain of 1.9 million this year. The unemployment rate falls steadily
throughout the forecast, reaching 7.6 percent at the end of 2013 and 7.2 percent by the close of
2014.

Consumer price inflation remains tame over our forecast horizon. Core CPI inflation (excluding
food and energy prices) picks up to 2.1 percent this year but then settles back to 1.7 percent in
2013 and 1.8 percent in 2014. Higher food prices due to the drought cause increases in the allitems CPI slightly ahead of core inflation rates. Headline inflation averages just under 2 percent
for 2013 and 2014.
Some additional assumptions affect the outlook for Michigan, most notably with regard to the

automotive industry. The United Auto Workers and the Detroit Three automakers have entered the
second year of four-year contracts that run to September 2015. Increased pay over the course of the
contracts is in the form of lump sums, with no increase in base wages. A portion of the lump-sum
payment is performance-based. In our forecast we have assumed lump-sum payments that average
$1,300$1,400 per qualified worker across the three companies in each of the years 2012 through
2014. With regard to profit-sharing, the current contract follows a new and more generous scheme; we
assumed payouts averaging about $5,000$6,000 per eligible worker in 2013 and 2014. There is a
wide range in expected payments across the three companies, especially in profit-sharing. Neither a
contract reopening nor a strike is anticipated during the forecast period.

15
As shown in Chart 2, we

Chart 2

U.S. Light Vehicle Sales

Total vs. Detroit Three, 201114

Millions
of Units
18

sales of U.S. light vehicles

16
14
12

are forecasting that total unit

15.6

15.0

14.3

cars, minivans, sport utility

12.7

vehicles,

crossovers,

and

10
8

5.9

6
4

6.7

44.4
2011
Total

7.0

pickup truckswill continue to

improve,

46.2

2
0

6.4

2012
Detroit Three

44.7
2013

with

healthy

45.0

upward movement from the

2014

Annual % Detroit Three

market share

12.7 million units recorded in

2011 to 14.3 million this year,

RSQE: November 2012

then rising further but at a

slower pace over the next two years, to 15 million in 2013 and 15.6 million in 2014. Pent-up demand is
significant, especially considering that the average age of a vehicle on the road today is at record
levels, and that vehicle sales remain historically low relative to the driving-age population. Sales do not
recover over the forecast period, however, to the 16 to 17+ million units sold annually in the years from
1999 to 2007.

The Detroit Threes share of the light vehicle market moved up two percentage points last year to
46.2 percent, due in part to a temporary boost resulting from the natural disasters in Japan. We see
their share backing off, to 44.4 percent in 2012, before drifting up to 44.7 percent in 2013 and 45
percent in 2014. The projections for total sales and the Detroit Threes share of that market, taken
together, yield our outlook for Detroit Three sales, which move up progressively from 5.9 million units in
2011 to 7 million in 2014. We do see a slower rate of increase over the next two years compared with
this year, however, with Detroit Three sales rising only a little less in the single year of 2012 (500,000
units) than the cumulative gain of 600,000 units we are forecasting over the following two years.

We now turn to our view of the prospects for the Michigan economy through 2014.

16
V.

The Forecast for 20132014

Michigan is now chalking up its third consecutive year of economic recovery, although its pace
has slowed during 2012. The recovery has been led by manufacturing, which in Michigan is the typical
trigger during the earlier stages of economic rebounds. Painting with the broadest brush, we see the
recovery sustained but moderately paced from now through 2014, the endpoint of our forecast period,
with some pickup in activity over the period. This would extend the recovery period to five years,
starting from the labor markets low point at the end of 2009.

The

downshift

in

job
Chart 3

growth for 2012 is apparent

from the data in Chart 3, which

Change in
Employment

shows

calendar-year

100,000

change in wage and salary

80,000

employment for Michigan from

60,000

the

2011 through the end of our

Change in Michigan Wage and Salary

Employment, 201114

Forecast
91,900
75,300
59,100

57,600

51,800

40,000

37,500

With

20,000

one quarter of data yet to come,

forecast period in 2014.

2011

we are estimating that 2012 will

2012
Total jobs

62,800

43,300

2013

2014

Private-sector jobs

RSQE: November 2012

come in with a gain of 51,800

jobs, well off the pace of the 75,300 job additions posted last year. We see continuing additions to the
job count in 2013 and 2014, at a pace of 37,500 and 57,600 jobs, respectively. The moderate rate of
job creation in these two years reflects both our forecast of a slower rate of increase in Detroit Three
light vehicle sales moving forward and, more generally, the continuing below-trend growth forecast for
the U.S. economy.

Obviously, if more promising results come to pass in either of these arenas,

Michigans prospects will improve as well.

17
The profile for the job market in the private sector is a little stronger than the total, since the total
is brought down by government employment, which continues to shrink over the forecast period. The
private sector adds more than 59,000 jobs in 2012, followed by gains of about 43,000 and 63,000 in
each of the next two years, respectively. As will be seen shortly, these data based on annual averages
do mask some of the dynamic movements of job creation that are better represented by the quarterly
data path.

Our

calendar-year

foreChart 4

cast of employment is put in

broader historical context in
Chart

4,

which

shows

the

annual job change in Michigan

since 1940.

The job gain of

51,800 estimated for 2012 falls

a

little

below

the

average

Thousands
of Jobs

300

WW II

200

Average Change
19712000 = 57,000 jobs

100
0
100
200
300

change of 57,000 jobs per year

Change in Michigan Wage and Salary

Employment, 19402011
and Forecast, 201214

Forecast

400
40 45 50 55 60 65 70 75 80 85 90 95 00 05 10 14

recorded from 1971 to 2000,

RSQE: November 2012

prior to the extended downturn

of the 2000s. The gain forecast for 2013 would fall well below this benchmark, but job growth in 2014
bounces back to essentially match the benchmark.

Next, we consider the quarterly path of employment over the forecast period, as well as the
underlying industry detail. We start with Chart 5, which shows our projected growth path for payroll
employment from now through 2014, measured in quarterly time intervals. The box at the bottom of the
chart translates the path into changes in employment during each yearthat is, the change from the
end of one year to the end of the next yearshown both as a percentage and in thousands of jobs.

18
The left panel of the

Chart 5

Michigan Wage and Salary Employment Growth

chart

Annual Rate (%)

Actual
3.1

Forecast

comment made earlier on the

3.0

uneven pattern of growth seen

1.2

1
0

substantiates

0.7

0.8
4

10

2011

1.5

1.2

0.4
3 4 1

2012

so

far

during

2012.

manufacturing-led surge in job

2

2013

growth in the first quarter,

2014

spiking at an annual rate of 3

1.5
57.8

4th Quarter to 4th Quarter Growth Rate (%)

1.6
1.1
1.2
4th Quarter to 4th Quarter Change (Thousands)
63.8
43.4
49.6

1.5
61.5

percent,

was

considerably

followed
weaker

by

spring

RSQE: November 2012

and summer quarterssimilar

in pattern to the profile for 2011. Job growth for the middle two quarters of 2012 averaged an annual
rate of one-half of a percentage point, and we anticipate the final quarter of the year to come in at a
similar rate of 0.4 percent, with modest gains in the private sector more than offsetting losses in the
government sector.

The right panel of the chart shows our quarterly forecast path of job growth during 2013 and 2014.
We do see some pickup in the economy going into 2013 and continuing through 2014. Job growth
accelerates from its 0.5 percent pace over the last three quarters of 2012 to 1.2 percent at the
beginning of 2013, holding in that neighborhood throughout most of the year before bumping up its
tempo to settle in around 1.5 percent during 2014. For comparison, the average job growth recorded
over the first two years of the recovery (2009q4 to 2011q4) was 1.6 percent.

This pattern of growth translates into progressively increasing yearly job gains: 43,400 during
2012, 49,600 during 2013, and 61,500 in 2014, and represents more clearly than do annual averages
our outlook for employment over the period. The pattern is consistent with a U.S. economy that we see
accelerating over the next two years, but with growth remaining moderate.

19
More detail underlying the forecast path for total payroll employment is revealed by the
movements of some of the major sectors that make up the work force. The changes for total wage and
salary employment during 2011 and the forecast years 2012 through 2014, displayed at the bottom of
Chart 5, are duplicated (and rounded) in the first row of Table 5. The rest of the rows show the same
information for major sectors contributing to work force movements.

Michigans

Table 5

Michigan Wage and Salary Employment Changes

(Thousands of jobs)

signature

sector, manufacturing, has led

the current recovery following

2010q4
to
2011q4

2011q4
to
2012q4

2012q4
to
2013q4

2013q4
to
2014q4

Total wage and salary

64

43

50

62

employment. In the first two

Manufacturing

23

16

10

13

years of the recovery, from the

10

end of 2009 to the end of

17

15

12

Private educ. & health svcs.

28
11

Trade, transportation, utilities

10

13

13

Construction
Professional & business svcs.

Government

decade

of

declining

2011 (not shown in the table),

manufacturing

contributed

50,000 jobs, more than 40

RSQE: November 2012

percent of the net gain in jobs

over that period from a sector that makes up a much smaller 13 percent of the work force. The sector
adds another 16,000 jobs during 2012, but by the second half of 2012 we see manufacturing settling
into a more moderate pace of job creation, contributing an additional 23,000 jobs from the end of 2012
through 2014. That would still amount to 25 percent of the total net additions over the next two years,
double its current share of the total work force.

Close to half of the manufacturing job additions over the next two years are directly attributable to
the auto industry, and many of the rest derive from auto-related industries. We are forecasting that the
auto industry will add another 10,000 jobs from the end of 2012 through 2014. Because the industry is
so extensively networked in the local economy, the effects of its direct contributions to job growth also
spill over into other parts of the private sector.

20
Construction has been plagued in recent years by the plunge in the building market, but we
anticipate some revival in this sector. By our estimate, construction added 3,400 jobs in the second
half of 2012, and we are projecting further gains averaging 9,500 per year over the next two years.
Recent data on the local housing market suggest that it might have begun to turn around. State
residential building permits are on the rise, and the Home Builders Association of Michigan is seeing an
improvement in new home building this year compared with the smaller gains recorded in 2010 and
2011. The home builders attribute the improvement to pent-up demand finally starting to move things
forward, which would bode well for construction employment in the next few years.

Along with manufacturing, the professional and business services sector has been Michigans
other top job producer over the past three years.

This broad category includes a wide range of

industries from legal and engineering to temporary help. Much of the impetus for the sectors healthy
job growth in the earlier stages of the recovery emanated from the temporary help industry, but this
year the gains in temporary help have slowed. On the other hand, job growth in the well-compensated
professional, scientific, and technical services component has accelerated; so far during 2012, this
component has contributed five jobs in eight gained in the professional and business services sector.
We are forecasting that the sector will add another 27,000 jobs from the end of 2012 to the close of
2014, a quarter of the jobs gained in total, supported by a still-favorable commercial environment locally
and a continuing expansion of the manufacturing sector.

Almost 90 percent of the private education and health services sector is the health care segment.
This sector has been the most robust in the Michigan economy over the longer term, having added to
employment every year starting in 1999in fact, the only major sector to have done so. We see this
trend continuing through 2014; we estimate that the sector added 5,000 jobs during 2012, and forecast
that it will contribute another 15,000 from then through 2014, split evenly between the two years. The
longer-term prospects for employment in the health care industry would seem favorable as well, as we
are in the initial stages of a surge in the number of people reaching retirement age.

21
Trade, transportation, and utilities (TTU) is the largest supersector in the Michigan economy,
consisting of both wholesale and retail trade, local transportation, and public utilities. After gaining
9,000 jobs during 2011, the sector gravitated to the negative side of the ledger in 2012, by our estimate
losing 1,000 jobs, with the losses concentrated in the beleaguered retail trade industry.

We are

forecasting a bounce-back in 2013 for TTU, to job gains similar to those posted in 2011, as we see
some modest recovery in retail while other components of TTUwholesale trade, trucking, and
warehousingcontinue to benefit from their tie-ins to the expanding manufacturing sector.

The government sector has lost jobs in every year starting with 2003, and we are projecting that
trend to continue through the forecast period, with job losses of 5,000 during 2012 and 7,000 in 2013,
slowing to 3,000 in 2014 as all levels of government continue to adjust to their new budget realities. If
our forecast proves correct, there would be 91,000 fewer public-sector positions in the state at the end
of 2014 than twelve years earlier, at the end of 2002.

Overall, though, this is a good news story: the recovery continues for two more years, and activity
levels see some pickup over the periodthus cumulating to five years of growth after a decade of
decline. But how much ground are we making up in the recovery relative to what we lost? This is the
historical context question, when we assess our progress from the previous peak rather than from the
most recent troughand here the news is decidedly more somber.

The quarterly path of establishment employment from the start of 2000 to the end of 2014 is
shown in Chart 6, which neatly summarizes Michigans recent economic history and our view of its
near-term future. The dramatic decline in jobs from the states peak employment quarter in the spring
of 2000 to its trough at the end of 2009 stands outa loss of 858,700 jobs over the interval.

Then the recovery follows: from its low point at the end of 2009 to the third quarter of 2012,
Michigan gained 161,000 jobs. And from then to the end of 2014, we are forecasting that the state will
create an additional 115,100 jobs, thus cumulating to 276,100 job additions from the bottom of the

22
downturn through 2014.

That
Chart 6

would replenish one-third of the

jobs lost from mid-2000 to the
end of 2009progress indeed,
but also leaving us with a great

Michigan Wage and Salary Employment

First Quarter of 2000 to Fourth Quarter of 2014
Thousands of jobs

4,800
4,700
4,600

Peak 00q2

Forecast

4,500

deal of ground still to be made

4,400
4,300

up.

4,200

14q4

4,100

There is also room for

improvement in the prospects

12q3

4,000
3,900
Trough 09q4

3,800

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14

for

the

unemployed.

The

RSQE: November 2012

Michigan unemployment rate came in at 9.3 percent for September 2012, a drop of 1.1 percentage
points since the previous September reading (comparable to the decline in the U.S. rate). But that
does not tell the story of the underlying dynamics. From July 2011 to April 2012, the Michigan rate fell
in every month, to 8.3 percent last April, a drop of 2.3 percentage points. Since then it rose in every
month until reaching 9.4 percent in August, an increase of 1.1 percentage points, before ticking down in
September. The net result of these down-then-up movements is that the Michigan rate is now the
same as it was last December. The gap between the Michigan rate and the lower U.S. rate had shrunk
to two-tenths of a percentage point by April, but it has now widened to 1.5 percentage points by
September.

We are forecasting that the state unemployment rate will tick down from its September reading of
9.3 percent to average 9.1 percent in the closing quarter of 2012, as shown in the box at the bottom of
Chart 7. With some pickup in job growth during 2013 and 2014, the unemployment rate moves down to
8.4 percent by the end of the first year and then drops further, to 7.7 percent, at the close of 2014, at
which point it will be five-tenths of a percentage point above the U.S. rate, according to our forecast.

23
The labor force appears

Chart 7

Michigan Unemployment Rate

201114
12%

to have reversed its five-year

slide at the beginning of 2012,

10.3

10%

8.9

although the jury might still be

8.7

8.0

8%

out on that one. Regardless,

6%

we are forecasting a growing

4%

labor force over the next two

2%

years,

0%

2011

2012

2013

seekers

4th Quarter Unemployment Rate

9.6

9.1

as

additional

job

2014

8.4

7.7

are

drawn

in

by

improving job opportunities

RSQE: November 2012

and that slows the decline in

the unemployment rate. As indicated in the U.S. forecast report, longer-term demographic trends can
be expected to soften a labor force recovery motivated by economic factors.

As shown in Chart 7, our forecast path for the state unemployment rate translates into calendaryear averages of 8.9 percent for 2012, 8.7 percent for 2013, and 8 percent for 2014, following a rate of
10.3 percent for 2011.
Chart 8

The calendar-year jobless

Michigan Unemployment Rate, 19702011

and Forecast, 201214

rates we are forecasting for

2012

to

2014

are

put

in

16%

Forecast

14%

historical context in Chart 8,

which

shows

the

Michigan

unemployment

rate

annually

Average Unemployment Rate

1970 2008 = 7.9%

12%
10%
8%
6%

from 1970 to 2014. The jobless

4%

rates for 201214 are on the

2%

high side historically, but by

70
RSQE:November 2012

75

80

85

90

95

00

05

10

14

24
2014 they gravitate down to a rate similar to the 7.9 percent averaged from 1970 to 2008.

Our forecast of inflation

Chart 9

and income growth is provided

Michigan Inflation and Income Growth

in Chart 9.

Local inflation,
7%

7%

measured by the growth rate of

6%

6%

the Detroit CPI, is shown in the

5%

5%

4%

first panel.

Inflation spiked to

3%

3.3 percent in 2011, spurred by

2%

a run-up in food and energy

prices.

It backs off to 1.9

4%

3.3

7%
6%

5.6
4.5
3.8

3%
1.9 1.8 1.8

5%
4%
3%

2.6

2%

2%

1%

1%

1%

0%

0%

0%

Detroit CPI
2011

percent in 2012 and remains

Personal Income
2012

2013

1.1

1.8

1.5
0.5

Real Disposable Income

2014

RSQE:November 2012

subdued for the rest of the

forecast period, ticking down to 1.8 percent for both 2013 and 2014. Although the recent drought is
projected to raise food prices in 2013, fairly moderate economic growth in a high-unemployment
environment keeps inflation in check. Local inflation runs one-tenth of a percentage point below the
national rate in 2013 and 2014.

The income side of our forecast is summarized in the other panels of Chart 9. Personal income
growth decelerates from 5.6 percent in 2011 to 3.8 percent in 2012, corresponding with calendar-year
job growth that slows by seven-tenths of a percentage pointincluding a softening in the higher-paying
industriesand weaker growth in total nonwage income. Income growth slows further in 2013, to 2.6
percent, for the same reasons. With some pickup in employment and nonwage income growth in 2014,
personal income growth bounces back to a healthier rate of 4.5 percent.

Growth in real disposable income, that is, personal income adjusted for taxes and inflationor
purchasing poweraccelerates from 1.1 percent in 2011 to 1.5 percent in 2012, as lower inflation and
a smaller increase in federal taxes trump slower nominal income growth and a hike in Michigan taxes.

25
Growth in purchasing power then decelerates to 0.5 percent in 2013 with further weakening of nominal
income growth and a small increase in the growth of federal taxes. Growth in purchasing power
rebounds in 2014, to 1.8 percent, following the same pattern as nominal income growth.

Our income forecast has implications for the state revenue outlook, to which we now turn.

VI.

The State Revenue Outlook

Last years tax reform legislation made major changes to the personal income tax and to the
primary tax paid by businesses. The net effect of those changes is a reduction in combined general
fund general purpose (GFGP) and school aid fund (SAF) revenue. In addition, taxes are shifted from
businesses to individuals and from the school aid fund to the general fund. In June of 2012, the
legislature enacted some temporary tax relief for individuals by accelerating a scheduled reduction in
the income tax rate and by raising the standard personal exemption.

Under current law (including tax reform and the June tax cut), the personal income tax rate
dropped by one-tenth of a percentage point, to 4.25 percent, on October 1three months sooner than
under the tax reform plan. The rate is then scheduled to remain at 4.25 percent. In addition, the
personal exemption, which had been $3,700 since the beginning of 2011, rose to $3,950 on October 1,
2012, and is scheduled to rise to $4,000 at the beginning of 2014. The personal exemption remains at
that level until the amount as calculated under prior law exceeds $4,000. All of the eliminations or
modifications to other exemptions and deductions that were part of tax reform are still in force, and the
phased-in taxation of pension income that began January 1, 2012, is proceeding as scheduled.

It is estimated that changes to the personal income tax raised revenue by about $525 million in
fiscal 2012. Combining the reform effects with the June legislation is expected to increase taxes by a
net $1.24 billion (+1.35 billion tax reform 105 million tax cut) in fiscal 2013 and by $1.54 billion (+1.58
billion 35 million) in fiscal 2014.

26
On the business side, as of January 1 the Michigan Business Tax (MBT) was replaced with a
corporate income or profits tax that applies only to businesses organized as a traditional corporation (Ccorporation) under federal tax rules. The corporate tax disallows nearly all the credits offered under the
MBT, but some of the credits under the MBT are valid over a number of years. Those wishing to take
advantage of certain firm-specific credits may continue to pay taxes under the MBT until the credits are
exhausted, which could take a number of years. A portion of the MBT was earmarked for the SAF, but
as of fiscal 2012, all MBT and corporate income tax revenue accrues to the general fund. In total, the
new legislation reduced business tax revenue by about $1.01 billion in fiscal 2012. The business tax
cuts then grow to $1.64 billion in fiscal 2013 and $1.75 billion in fiscal 2014.

Two other pieces of legislation passed in June 2012 will result in a one-time shift in a portion of
sales tax revenue in fiscal 2013.

To provide additional state funding to leverage federal aid for

highways, $100 million of sales tax revenue from motor fuel sales will be earmarked for the State
Trunkline Fund. In addition, $10 million from the tax on sales of aviation fuel will be designated for the
Aeronautics Fund. The two earmarks will reduce GFGP sales tax revenue.

Our forecast of state revenues for fiscal years 201314 is presented in Table 6. The upper
portion details general fund general purpose revenues, and the lower portion summarizes school aid
fund revenues. Based on preliminary data, GFGP income tax revenue rose by 8.7 percent in fiscal
2012, bolstered by withholding on pension income and quarterly estimated payments that reflected the
increase in tax liability under tax reform. We anticipate a surge in income tax revenue in fiscal 2013 as
annual payments for the 2012 tax year also reflect the tax changes. By fiscal 2014, the increase in
income tax revenue moderates to move more in line with taxable income growth. The vast majority of
the revenue growth from fiscal 2011 to fiscal 2014 is due to tax reform.

GFGP consumption tax revenue derives from the sales and use taxes as well as levies on
tobacco and alcohol. GFGP consumption tax revenue rose by 3.6 percent in fiscal 2012, following a
1.2 percent decline in fiscal 2011. Sales and use tax collections are forecast to rise by about 3 percent

27

Table 6
State Revenues by Fiscal Year
(Millions of dollars, except as noted)
Actual
P

RSQE Forecast
2013
2014

2011

2012

Personal income tax

(% change)

4445
(20.3)

4833
(8.7)

5552
(14.9)

5869
(5.7)

Consumption taxes
(% change)
Sales
Use
Other consumption

2083
(1.2)
1067
734
282

2157
(3.6)
1092
782
284

2125
(1.5)
1013
835
278

2293
(7.9)
1153
868
272

Business taxes
(% change)
MBT/SBT/Corporate Income
Other business

1678
(15.5)
1347
331

1585
(5.5)
1232
353

697
(56.0)
332
365

694
(0.3)
318
376

Other GFGP taxes

(% change)

69
(18.8)

41
(40.6)

48
(17.5)

51
(7.0)

GFGP tax revenue

(% change)

8274
(12.7)

8616
(4.1)

8422
(2.3)

8908
(5.8)

539

467

355

332

8813
(14.3)

9083
(3.1)

8777
(3.4)

9241
(5.3)

10521
(4.0)

10118
(3.8)

10363
(2.4)

10659
(2.9)

727
(3.7)

770
(5.9)

745
(3.3)

739
(0.8)

11248
(4.0)

10888
(3.2)

11108
(2.0)

11398
(2.6)

7810
(5.6)

8150
(4.4)

8401
(3.1)

8654
(3.0)

General Fund General Purpose

Nontax revenue
GFGP revenue
(% change)
School Aid Fund
SAF taxes
(% change)
Lottery transfer
(% change)
Earmarked state SAF revenue
(% change)
Addendum
Gross sales and use taxes
(% change)
P

Preliminary

RSQE: November 2012

28
per year in fiscal 2013 and 2014, but the one-time earmark of transportation-related sales tax revenue
yields a 1.5 percent drop in GFGP consumption tax revenue in fiscal 2013 followed by roughly an 8
percent gain the following year.

Most of the movement in business tax revenue through fiscal 2013 comes from changes in the
Single Business Tax (SBT)/MBT/corporate income tax. According to preliminary data, combined
revenue from the MBT and corporate income tax, net of any lingering refunds under the SBT, totaled
$1.23 billion in fiscal 2012 as taxpayers settled up their MBT liability for the 2011 tax year and began
making their estimated payments under the corporate income tax for the 2012 tax year. Some firms
are expected to file taxes under the MBT in future years to take advantage of outstanding credits.
When the implied MBT refunds are combined with a full year of corporate income tax collections,
revenue shrinks to $332 million for fiscal 2013 and to $318 million the following year. Business taxes
including taxes on insurance companies and on oil and natural gas extractionfell by 5.5 percent in
fiscal 2012 and are projected to plummet by more than 50 percent in fiscal 2013. In 2014, business tax
revenue dips by 0.3 percent.

GFGP revenue rose by 3.1 percent, to $9.1 billion, in fiscal 2012. All of that gain is wiped out in
fiscal 2013the result of a full year of business tax cuts and a sharp drop in nontax revenue. GFGP
revenue then rises by 5.3 percent in fiscal 2014, to $9.24 billion.

For the fiscal year just ended, revenue earmarked for the school aid fund dropped by 3.2 percent.
The loss of designated MBT revenue$739 million in fiscal 2011more than accounts for the falloff.
Among the major sources of SAF revenue, sales, use, and individual income taxes are all projected to
register solid gains in fiscal 2013, but the state education tax is expected to be essentially flat. SAF
revenue grows moderately, rising by 2 percent to $11.11 billion. By fiscal 2014, the state education tax
is starting to edge higher, contributing to a stronger 2.6 percent gain in SAF revenue, to $11.40 billion,
that year.

29
VII. Conclusion

A. Summary of the Outlook

First, the good news. The Michigan economy is on the verge of completing its third year of
recovery, and we see that recovery continuing over the next two years, with some pickup in activity
over the period. Specifically, we are forecasting progressively increasing job gains through 2014,
amounting to 43,400 from the end of 2011 to the end of 2012, followed by additions of 49,600 during
2013 and 61,500 during 2014. As is typical in Michigan, the recovery has been led by manufacturing,
featuring a reborn auto industry, with a number of the other higher-wage sectors such as professional
and scientific services making major contributions.

Second, the less-good-but-not-bad news. The pace of recovery slowed in 2012, the 43,400 jobs
added over the year being considerably less than the gains of 57,800 and 63,800 posted during 2010
and 2011, respectively. And much of the growth in 2012 occurred early, in the first quarter of the year.
The job gains we anticipate over the next two years, while accelerating, would still be characterized as
moderate.

We are forecasting that improvements in the job market will allow the Michigan unemployment
rate to drift down from the 9.3 percent rate it posted in September of this year to 8.4 percent at the end
of 2013 and 7.7 percent at yearend 2014, at which point it will be five-tenths of a percentage point
above the U.S. rate. The jobless rates over the forecast period are on the high side historically, but by
mid-2014 they gravitate down to rates similar to the 7.9 percent averaged from 1970 to 2008.

B. Risks to the Forecast

All forecasts have risks; that is, certain outcomes could diverge from our expectations and affect
the accuracy of the forecast. The most significant risk factors associated with the state forecast are

30
those related to the national outlook and those that pertain to the auto and housing sectors and the
labor market.

Risks associated with the national outlook.

The risks highlighted in the current U.S. outlook

are also matters of concern for the state forecast. The Michigan economy seems a little more coupled
to the national economy in the past few years than it has been for a while. Domestically, important
sources of uncertainty identified in the U.S. forecast include risks related to the housing market, and the
fiscal cliff.

Internationally, the primary risks pertain to the continuing evolution of the situation in the

Eurozone and the possibility of an even more significant slowdown of growth in the Chinese economy.

Risks associated with the auto sector. This item is permanently on Michigans risk list because
of the industrys dominance in the state economy, and its interdependence among many local
industries. While we are projecting the auto industry to continue growing over the forecast period, we
also anticipate that it will do so at a slower pace. To the extent that Detroit Three sales show greater
strength than we expect, due to the effects of pent-up demand and the aging fleet now on the road, as
well as some easing of credit standards, the auto sector could outperform our forecast.

Risks associated with the housing sector.

The movements of this sector are particularly

difficult to peg, both nationally and locally, but they are important to gauging our economic prospects.
For example, and particularly relevant to Michigan, Morgan Stanley recently estimated that in 2013,
every 100,000 in new housing starts would translate into 300,000 vehicle sales. Recent data on the
local housing market, including the Case-Shiller home price index for Detroit as well as statewide
residential building permits, suggest the long-awaited turnaround in housing may have begun. This is
supported by information from the Home Builders Association of Michigan, which expresses cautious
optimism but also has concerns about access to credit and a shortage of workers in places such as
Grand Rapids and Ann Arbor where demand is speeding up. We are forecasting some pickup in
statewide building over the next two years, contributing to stronger growth in construction, but given the
uncertainties that linger in this market both locally and nationally, we could miss in either direction.

31
Risks associated with labor market movements. Michigans labor force growth has been
notoriously difficult to forecast, and how accurate we are in doing so affects our success in pinning
down the path of the unemployment rate. It appears that the labor force has turned the corner in 2012,
growing again after five years of unabated decline, but this evidence is far from conclusive. Our
forecast is for continued growth in the labor force over the next two years, softening declines in the
unemployment rate. If job seekers do not return to the labor force in the numbers we anticipate, the
unemployment rate could drop more rapidly than we are currently forecasting.

Complicating the

tracking of labor force movements is the nontrivial effect that demographic changes are having on
participation rates.

C. Closing Thoughts

If we assess where the Michigan economy is now and where we will be in 2014 from the
reference point of the previous peak in mid-2000, we are reminded of how deep a hole we are digging
out of. If our forecast proves correct, with five years of recovery to the end of 2014 we would replenish
only one-third of the jobs lost from mid-2000 to the end of 2009. And the debilitating state recession
that dragged on for almost a decade also caused us to lose significant ground to the nation on wage
levels, moving from a position a little above the U.S. average in 2001 to a position well below in 2012.
A lingering concern is that the unprecedented hit taken by the state economy during the first decade of
the 2000s may have left us with some permanent damageor at least with an overlong period of
recovery. Nevertheless, it is heartening that we are making forward progress now, and at rates of job
growth exceeding most other states.

32
Constant Adjustments in the RSQE Control Forecast for 20132014
The following adjustments have been used to correct for level drift and start-up error:
A.AEQGM
A.AEQPM
A.BLDPER
A.ECCM
A.EFINM
A.EINFM
A.EMFOM
A.EMIM
A.EMRESM
A.EMTEQM
A.ESBM
A.ESHM
A.ESLM
A.ESOM
A.ETTUM
A.HOUSEM
A.HRSM
A.LFM
A.PAAAGA
A.PDIESE
A.PSTKNR
A.SEVNR
A.SEVR
A.STKNR0
A.TBWMNS
A.TCIGMN
A.TCTF
A.TDIESE
A.TGASMN
A.TLIQMN
A.TOILM
A.TRET
A.TRSNVM
A.TRSVM9
A.TSEP
A.TUPM
A.TUSEMN
A.TVEHRE
A.WM
A.WUS
A.YENTM
A.YOLM
A.YPRM
A.YUCTRM

Average Earnings per Quarter, Government

Average Earnings per Quarter, Private
Residential Building Permits
Employment, Construction
Employment, Financial Activities
Employment, Information
Employment, Manufacturing other than Transportation Equipment
Employment, Natural Resources and Mining
Difference between Household and Payroll Survey Employment
Employment, Transportation Equipment Manufacturing
Employment, Professional and Business Services
Employment, Education and Health Services
Employment, Leisure and Hospitality
Employment, Other Services
Employment; Trade, Transportation, and Utilities
Existing Single-Family Home Sales
Average Weekly Hours, Manufacturing
Labor Force
Retail Price of Gasoline
Price of Diesel Fuel
Current Cost Price Index, U.S. Nonresidential Capital Stock
State Equalized Value for Real Nonresidential Property
State Equalized Value for Real Residential Property
Real U.S. Nonresidential Capital Stock
Beer and Wine Tax Revenues
Cigarette and Tobacco Tax Revenues
Comprehensive Transportation Fund Revenues
Diesel Fuel Tax Revenues
Gasoline Tax Revenues
Liquor Specific Tax Revenues
Oil and Gas Severance Tax Revenues
Real Estate Transfer Tax Revenues
Sales Tax Revenues, Other
Sales Tax Revenues, Auto
State Education Property Tax Revenues
Utility Property Tax Revenues
Use Tax Revenues
Vehicle Registration Tax Revenues
Average Hourly Earnings, Manufacturing
Average Hourly Earnings, U.S. Manufacturing
Proprietors Income
Other Labor Income
Dividends, Interest, and Rental Income
Unemployment Benefits

The following adjustments have been used to reflect policy or tax changes as well as to correct for level drift and
start-up error:
A.AFDC
A.TYAMNS
A.TYQMNS
A.TYWM

Caseload for Family Independence Program

Michigan Personal Income Tax, Annual Payments
Michigan Personal Income Tax, Quarterly Payments
Michigan Personal Income Tax, Withholding

The Michigan Economic Outlook for 2013-2014

RSQE Forecast, 16 November 2012

The State of Michigan

INDEX OF TABLES
Table 1: Michigan Personal Income
Table 2: Employment in Michigan
Table 3: State of Michigan GFGP Revenue
Table 4: State of Michigan SAF and Transportation Tax Revenue
Table 5: Selected State of Michigan Tax Revenues

Complete Model Output

Non-zero Adjustment Constants
Exogenous Variables
Endogenous Variables
Growth Rates of Endogenous Variables

Forecast Based on
The Econometric Model of the State of Michigan
RSQE
Research Seminar in Quantitative Economics
The University of Michigan
Ann Arbor, Michigan 48109

RSQE Forecast

Table 1
Michigan Personal Income

16 November 2012

(Millions of Current Dollars, SAQR)

Actual

Forecast

2012q3

2012q4

2013q1

2013q2

2013q3

2013q4

2014q1

2014q2

2014q3

93247.58

94044.66

93973.94

94893.57

95804.99

96769.49

98094.78

99105.64

100106.16

Wage and Salary

Private
Government

47805.00
40380.25
7424.71

48091.30
40678.75
7412.55

48493.10
41055.69
7437.42

48971.15
41510.41
7460.74

49384.71
41898.87
7485.84

49883.17
42411.02
7472.15

50363.45
42859.29
7504.15

50885.49
43348.66
7536.83

51333.94
43762.88
7571.06

Other Labor Income

11565.00

11623.17

11719.96

11796.89

11880.56

11966.92

12089.10

12178.65

12275.19

Proprietors Income

6663.00

6766.04

6874.37

6970.62

7074.63

7182.28

7286.69

7396.69

7511.31

Property Income

12864.00

13054.96

13191.34

13304.48

13462.47

13594.74

13721.01

13856.92

14051.64

Transfer Payments

20918.20

21093.14

21249.48

21446.96

21651.07

21843.25

22469.11

22670.98

22875.08

464.50

469.08

473.70

478.37

483.08

487.84

492.65

497.50

502.40

Less:
Social Ins Contrib

7032.10

7053.04

8028.01

8074.90

8131.52

8188.70

8327.22

8380.59

8443.40

Less:
Federal Pers Taxes
Mich Withholding

7889.69
1986.00

7968.84
1892.16

8227.34
1939.35

8347.37
1944.37

8473.18
2002.66

8605.02
1970.47

9295.36
2016.80

9431.09
2023.79

9572.16
2083.57

Equals:
Disp Personal Income

83371.89

84183.66

83807.25

84601.84

85329.15

86194.00

86782.62

87650.76

88450.42

216.37

217.23

218.22

219.24

220.21

221.14

222.08

223.07

224.14

38532.10

38753.99

38404.11

38588.32

38749.50

38976.91

39077.54

39292.29

39462.71

Personal Income

Residence Adjustment

ADDENDA:
Consumer Price Index
Detroit 1982-84=100
Real Disposable Income
Millions of 1982-84 $

RSQE Forecast

Table 1
Michigan Personal Income

16 November 2012

(Millions of Current Dollars, SAQR)

Forecast

Calendar Years

Percent Changes

2014q4

2011

2012

2013

2014

2011-2012

2012-2013

2013-2014

101185.74

358151.75

371676.49

381442.00

398492.32

3.78

2.63

4.47

Wage and Salary

Private
Government

51837.73
44240.42
7597.31

183000.25
154084.50
28915.75

190458.30
160907.74
29550.52

196732.14
166875.98
29856.15

204420.60
174211.26
30209.34

4.08
4.43
2.20

3.29
3.71
1.03

3.91
4.40
1.18

Other Labor Income

12367.54

44396.00

46074.92

47364.32

48910.48

3.78

2.80

3.26

Proprietors Income

7627.69

25069.25

26526.54

28101.89

29822.38

5.81

5.94

6.12

Property Income

14255.68

49359.00

51352.96

53553.03

55885.26

4.04

4.28

4.35

Transfer Payments

23092.05

81711.50

83442.34

86190.75

91107.22

2.12

3.29

5.70

507.35

1769.50

1849.58

1922.99

1999.90

4.53

3.97

4.00

Less:
Social Ins Contrib

8502.30

27153.50

28028.14

32423.13

33653.52

3.22

15.68

3.79

Less:
Federal Pers Taxes
Mich Withholding

9720.70
2051.31

29416.07
7220.10

31401.98
7810.96

33652.92
7856.85

38019.31
8175.47

6.75
8.18

7.17
0.59

12.97
4.06

Equals:
Disp Personal Income

89413.74

321515.58

332463.56

339932.23

352297.54

3.41

2.25

3.64

225.24

211.87

215.85

219.70

223.63

1.88

1.79

1.79

39697.58

151767.87

154024.63

154718.84

157530.11

1.49

0.45

1.82

Personal Income

Residence Adjustment

ADDENDA:
Consumer Price Index
Detroit 1982-84=100
Real Disposable Income
Millions of 1982-84 $

RSQE Forecast

Table 2
Employment in Michigan

16 November 2012

(Thousands of Persons, Seasonally Adjusted)

Actual

Forecast

2012q3

2012q4

2013q1

2013q2

2013q3

2013q4

2014q1

2014q2

2014q3

4231.50

4239.75

4252.46

4265.88

4279.67

4292.87

4308.44

4323.71

4339.77

3991.60

3995.56

4007.07

4019.23

4032.75

4045.14

4061.01

4075.81

4091.30

3379.10
7.50
120.50
526.60
152.10
374.60
720.90
54.40
200.10
570.50
630.40
380.70
167.50

3386.96
7.50
122.23
524.74
148.68
376.06
722.37
53.80
200.96
574.34
630.97
381.74
168.31

3399.47
7.45
124.15
526.49
149.25
377.23
725.07
53.73
201.73
577.99
632.43
381.93
168.50

3412.63
7.40
126.54
528.48
150.18
378.30
727.01
53.67
202.50
581.75
634.33
382.37
168.57

3427.15
7.38
129.16
531.07
151.44
379.63
729.28
53.64
203.23
585.43
636.30
382.98
168.68

3443.54
7.38
131.92
534.42
152.96
381.46
731.98
53.61
203.98
589.34
638.29
383.80
168.80

3459.91
7.40
134.44
537.88
154.46
383.43
735.18
53.62
204.65
592.68
640.32
384.67
169.07

3475.21
7.41
136.80
541.08
155.96
385.13
738.26
53.63
205.35
595.27
642.36
385.69
169.35

3491.20
7.40
139.10
544.26
157.51
386.75
741.50
53.66
206.02
598.33
644.42
386.81
169.68

612.60

608.60

607.60

606.60

605.60

601.60

601.10

600.60

600.10

239.90

244.18

245.39

246.65

246.93

247.73

247.43

247.90

248.47

4661.60

4665.47

4670.25

4676.16

4681.95

4688.13

4695.09

4702.93

4711.05

430.10

425.72

417.80

410.28

402.27

395.26

386.65

379.22

371.28

9.23

9.13

8.95

8.77

8.59

8.43

8.24

8.06

7.88

13616.20
1478.20

13662.42
1488.59

13735.41
1506.03

13810.08
1523.00

13897.94
1544.28

13990.11
1567.74

14075.76
1589.12

14164.90
1612.87

14272.50
1639.16

Gross Vehicle Product

Personal Cons Expend
New Autos + Trucks
Light Vehicle Sales (mil)

393.50

390.02

395.75

402.50

411.50

419.93

422.08

427.01

435.31

218.70
14.46

223.81
14.63

227.13
14.70

229.86
14.85

234.54
15.12

238.48
15.35

237.68
15.26

240.61
15.42

245.56
15.70

Unemployment Rate (%)

Personal Consumption
Deflator 2005=100
Consumer Price Index
1982-84=100

8.05

7.85

7.77

7.71

7.67

7.62

7.55

7.47

7.35

116.01

116.45

116.94

117.45

117.95

118.44

118.94

119.45

119.97

230.30

230.25

231.77

234.45

234.77

234.70

236.17

238.88

239.28

Total Employment
Wage and Salary
Private
Nat. Res. & Mining
Construction
Manufacturing
Trans. Equipment
Other Mfg.
Trade, Trans. & Util.
Information
Financial Activities
Prof. & Bus. Serv.
Edu. & Health Serv.
Leisure & Hospitality
Other Services
Government
Non Wage and Salary
Labor Force
Unemployment
Unemployment Rate (%)
ADDENDA: U.S. DATA
(Billions of chained 2005 $,
except where noted)
Gross Domestic Prod
Business Fixed Invest

RSQE Forecast

Table 2
Employment in Michigan

16 November 2012

(Thousands of Persons, Seasonally Adjusted)

Forecast

Total Employment
Wage and Salary
Private
Nat. Res. & Mining
Construction
Manufacturing
Trans. Equipment
Other Mfg.
Trade, Trans. & Util.
Information
Financial Activities
Prof. & Bus. Serv.
Edu. & Health Serv.
Leisure & Hospitality
Other Services
Government
Non Wage and Salary
Labor Force
Unemployment
Unemployment Rate (%)

Calendar Years

Percent Changes

2014q4

2011

2012

2013

2014

2011-2012

2012-2013

2013-2014

4355.85

4177.08

4243.86

4272.72

4331.94

1.60

0.68

1.39

4106.66

3936.73

3988.52

4026.05

4083.70

1.32

0.94

1.43

3507.56
7.39
141.22
547.53
159.02
388.51
744.73
53.72
206.73
601.65
646.50
388.08
170.01

3318.25
7.35
124.90
504.30
140.35
363.95
721.10
53.53
193.18
550.48
620.28
375.45
167.65

3377.37
7.43
121.36
525.49
148.47
377.02
721.64
53.55
198.74
571.29
629.54
380.13
168.23

3420.70
7.41
127.94
530.11
150.96
379.16
728.34
53.67
202.86
583.63
635.34
382.77
168.64

3483.47
7.40
137.89
542.69
156.74
385.95
739.92
53.66
205.68
596.98
643.40
386.31
169.53

1.78
1.03
-2.84
4.20
5.79
3.59
0.08
0.05
2.88
3.78
1.49
1.25
0.34

1.28
-0.28
5.42
0.88
1.67
0.57
0.93
0.21
2.07
2.16
0.92
0.69
0.25

1.84
-0.07
7.78
2.37
3.83
1.79
1.59
-0.01
1.39
2.29
1.27
0.93
0.53

599.10

618.50

611.20

605.35

600.23

-1.18

-0.96

-0.85

249.18

240.35

255.35

246.67

248.25

6.24

-3.40

0.64

4719.47

4657.80

4658.64

4679.12

4707.13

0.02

0.44

0.60

363.62

480.70

414.76

406.40

375.19

-13.72

-2.01

-7.68

7.70

10.32

8.90

8.69

7.97

NA

NA

NA

14372.55
1665.99

13299.10
1378.15

13583.38
1479.92

13858.38
1535.26

14221.43
1626.79

2.14
7.38

2.02
3.74

2.62
5.96

440.83

361.50

399.38

407.42

431.31

10.48

2.01

5.86

248.13
15.82

198.35
12.73

220.28
14.34

232.50
15.00

242.99
15.55

11.06
12.60

5.55
4.65

4.51
3.64

7.23

8.95

8.08

7.69

7.40

NA

NA

NA

120.49

113.79

115.81

117.70

119.71

1.78

1.63

1.71

239.34

224.94

229.56

233.92

238.42

2.05

1.90

1.92

ADDENDA: U.S. DATA

(Billions of chained 2005 $,
except where noted)
Gross Domestic Prod
Business Fixed Invest
Gross Vehicle Product
Personal Cons Expend
New Autos + Trucks
Light Vehicle Sales (mil)
Unemployment Rate (%)
Personal Consumption
Deflator 2005=100
Consumer Price Index
1982-84=100

RSQE Forecast

Table 3
State of Michigan GFGP Revenue by Fiscal Years

16 November 2012

(Millions of Current Dollars, NSA)

Actual

Forecast

2012q3

2012q4

2013q1

2013q2

2013q3

2013q4

2014q1

2014q2

NET PERS INCOME TAX

Less: School Aid
Camp Fund
GFGP INCOME TAX

1610.00
494.50
1.00
1114.50

1872.65
528.34
0.00
1344.31

1744.34
521.47
0.00
1222.87

2376.25
660.16
0.00
1716.09

1781.50
511.82
1.00
1268.68

1964.79
549.89
0.00
1414.89

1837.69
543.00
0.00
1294.69

2515.56
694.98
0.00
1820.58

CONSUMPTION TAXES
Sales
Cigarette Excise
Beer and Wine
Liquor Specific
Use
GFGP CONSUM TAXES

288.65
50.60
14.50
10.10
197.30
561.15

283.63
45.94
12.17
11.41
206.23
559.38

243.59
43.25
10.45
9.00
199.09
505.37

295.40
47.26
14.13
10.95
215.33
583.07

190.05
48.63
14.48
10.24
214.22
477.62

291.00
44.30
12.16
11.53
211.96
570.96

249.55
41.83
10.44
9.11
207.14
518.07

303.87
45.79
14.11
11.05
224.76
599.59

-57.30
763.60
525.60
300.00
11.70
0.00
1543.60

0.00
0.00
0.00
0.00
12.65
0.00
12.65

0.00
0.00
0.00
0.00
14.46
0.00
14.46

0.00
0.00
0.00
0.00
13.49
0.00
13.49

0.00
-527.40
858.90
311.40
13.15
0.00
656.05

0.00
0.00
0.00
0.00
13.88
0.00
13.88

0.00
0.00
0.00
0.00
15.00
0.00
15.00

0.00
0.00
0.00
0.00
14.10
0.00
14.10

0.00
58.20
0.00
58.20

0.00
0.00
0.00
0.00

0.00
0.00
0.00
0.00

0.00
0.00
0.00
0.00

0.00
58.55
0.00
58.55

0.00
0.00
0.00
0.00

0.00
0.00
0.00
0.00

0.00
0.00
0.00
0.00

OTHER GFGP TAXES

-17.30

0.00

0.00

0.00

-10.50

0.00

0.00

0.00

TOTAL GFGP TAXES

3260.15

1916.34

1742.70

2312.66

2450.40

1999.73

1827.76

2434.26

467.20

0.00

0.00

0.00

355.00

0.00

0.00

0.00

TOTAL GFGP REVENUE

3727.35

1916.34

1742.70

2312.66

2805.40

1999.73

1827.76

2434.26

ADDENDA
Pers Income Adjusted
Total Employment
Wage + Salary Income

79361.48
4231.50
47805.00

80004.55
4239.75
48091.30

80752.47
4252.46
48493.10

81521.51
4265.88
48971.15

82285.44
4279.67
49384.71

83114.95
4292.87
49883.17

83952.90
4308.44
50363.45

84815.24
4323.71
50885.49

BUSINESS TAXES
Single Business
Michigan Business
Corporate Income
Insur Co Premium
Oil + Gas Severance
Casino
GFGP BUSINESS TAXES
PROPERTY TAXES
Inheritance
Utility Property
Intangibles
GFGP PROPERTY TAXES

NONTAX REVENUE

RSQE Forecast

Table 3
State of Michigan GFGP Revenue by Fiscal Years

16 November 2012

(Millions of Current Dollars, NSA)

Forecast

Fiscal Years

Percent Changes

2014q3

2014q4

2012

2013

2014

2012-2013

2013-2014

NET PERS INCOME TAX

Less: School Aid
Camp Fund
GFGP INCOME TAX

1872.87
532.90
1.00
1338.97

2051.00
572.17
0.00
1478.83

6949.50
2115.30
1.00
4833.10

7774.74
2221.79
1.00
5551.95

8190.91
2320.78
1.00
5869.13

11.87
5.03
0.00
14.87

5.35
4.46
0.00
5.71

CONSUMPTION TAXES
Sales
Cigarette Excise
Beer and Wine
Liquor Specific
Use
GFGP CONSUM TAXES

308.91
47.19
14.45
10.35
223.64
604.55

300.52
42.85
12.16
11.67
219.77
586.97

1091.85
191.70
51.10
41.00
781.70
2157.35

1012.66
185.09
51.22
41.61
834.86
2125.44

1153.34
179.11
51.16
42.05
867.50
2293.17

-7.25
-3.45
0.24
1.48
6.80
-1.48

13.89
-3.23
-0.11
1.06
3.91
7.89

0.00
-613.90
932.40
319.20
13.80
0.00
651.50

0.00
0.00
0.00
0.00
14.59
0.00
14.59

-57.30
763.60
525.60
300.00
52.90
0.00
1584.80

0.00
-527.40
858.90
311.40
53.76
0.00
696.66

0.00
-613.90
932.40
319.20
56.79
0.00
694.49

-100.00
-169.07
63.41
3.80
1.62
NC
-56.04

NC
16.40
8.56
2.50
5.64
NC
-0.31

PROPERTY TAXES
Inheritance
Utility Property
Intangibles
GFGP PROPERTY TAXES

0.00
58.80
0.00
58.80

0.00
0.00
0.00
0.00

0.00
58.20
0.00
58.20

0.00
58.55
0.00
58.55

0.00
58.80
0.00
58.80

NC
0.60
NC
0.60

NC
0.43
NC
0.43

OTHER GFGP TAXES

-7.40

0.00

-17.30

-10.50

-7.40

-39.31

-29.52

TOTAL GFGP TAXES

2646.42

2080.38

8616.15

8422.09

8908.18

-2.25

5.77

332.40

0.00

467.20

355.00

332.40

-24.02

-6.37

TOTAL GFGP REVENUE

2978.82

2080.38

9083.35

8777.09

9240.58

-3.37

5.28

ADDENDA
Pers Income Adjusted
Total Employment
Wage + Salary Income

85674.48
4339.77
51333.94

86596.00
4355.85
51837.73

313235.23
4231.80
188861.75

324563.98
4259.44
194940.27

337557.56
4316.20
202466.04

3.62
0.65
3.22

4.00
1.33
3.86

BUSINESS TAXES
Single Business
Michigan Business
Corporate Income
Insur Co Premium
Oil + Gas Severance
Casino
GFGP BUSINESS TAXES

NONTAX REVENUE

RSQE Forecast

Table 4
State of Michigan SAF and Transportation Tax Revenue by Fiscal Years

16 November 2012

(Millions of Current Dollars, NSA)

Actual

Forecast

2012q3

2012q4

2013q1

2013q2

2013q3

2013q4

2014q1

2014q2

SAF TAXES
Sales
Use
Income
Mich Business
Liquor Excise
Tobacco
State Education Property
Real Estate Transfer
Ind and Comm Facilities
Casino
Other SAF Taxes

1322.10
98.60
494.50
0.00
10.10
101.50
1797.00
49.00
40.90
114.70
17.10

1315.26
103.11
528.34
0.00
11.41
92.11
0.00
37.08
0.00
0.00
0.00

1205.88
99.54
521.47
0.00
9.00
86.72
0.00
32.18
0.00
0.00
0.00

1310.72
107.66
660.16
0.00
10.95
94.77
0.00
40.54
0.00
0.00
0.00

1366.26
107.11
511.82
0.00
10.24
97.51
1789.73
48.01
42.00
106.30
17.10

1354.46
105.98
549.89
0.00
11.53
88.82
0.00
39.01
0.00
0.00
0.00

1238.34
103.57
543.00
0.00
9.11
83.87
0.00
34.76
0.00
0.00
0.00

1347.54
112.38
694.98
0.00
11.05
91.81
0.00
45.48
0.00
0.00
0.00

TOTAL SAF TAXES

4045.50

2087.32

1954.80

2224.80

4096.08

2149.70

2012.65

2303.25

770.00

0.00

0.00

0.00

744.70

0.00

0.00

0.00

4815.50

2087.32

1954.80

2224.80

4840.78

2149.70

2012.65

2303.25

27.80
210.30
882.60

27.48
203.34
0.00

23.40
188.06
0.00

27.15
206.46
0.00

29.32
212.05
902.65

27.82
204.97
0.00

23.92
189.74
0.00

27.71
208.42
0.00

Lottery Transfer
EARMARKED STATE
SAF REVENUE

TRANSPORTATION TAXES
Diesel
Gasoline
Motor Vehicle Registration

RSQE Forecast

Table 4
State of Michigan SAF and Transportation Tax Revenue by Fiscal Years

16 November 2012

(Millions of Current Dollars, NSA)

Forecast

Fiscal Years

Percent Changes

2014q3

2014q4

2012

2013

2014

2012-2013

2013-2014

SAF TAXES
Sales
Use
Income
Mich Business
Liquor Excise
Tobacco
State Education Property
Real Estate Transfer
Ind and Comm Facilities
Casino
Other SAF Taxes

1406.07
111.82
532.90
0.00
10.35
94.62
1814.10
53.95
43.50
109.40
17.10

1396.84
109.88
572.17
0.00
11.67
85.91
0.00
42.51
0.00
0.00
0.00

5074.10
390.80
2115.30
0.00
41.00
384.40
1797.00
142.90
40.90
114.70
17.10

5198.12
417.43
2221.79
0.00
41.61
371.11
1789.73
157.81
42.00
106.30
17.10

5346.40
433.75
2320.78
0.00
42.05
359.12
1814.10
173.21
43.50
109.40
17.10

2.44
6.81
5.03
NC
1.48
-3.46
-0.40
10.43
2.69
-7.32
-0.00

2.85
3.91
4.46
NC
1.06
-3.23
1.36
9.76
3.57
2.92
0.00

TOTAL SAF TAXES

4193.81

2218.99

10118.20

10362.99

10659.40

2.42

2.86

739.00

0.00

770.00

744.70

739.00

-3.29

-0.77

4932.81

2218.99

10888.20

11107.69

11398.40

2.02

2.62

29.98
214.13
921.15

28.40
207.17
0.00

105.00
814.20
882.60

107.35
809.90
902.65

109.42
817.26
921.15

2.24
-0.53
2.27

1.93
0.91
2.05

Lottery Transfer
EARMARKED STATE
SAF REVENUE

TRANSPORTATION TAXES
Diesel
Gasoline
Motor Vehicle Registration

RSQE Forecast

Table 5
Selected State of Michigan Tax Revenues by Fiscal Years

16 November 2012

(Millions of Current Dollars, NSA)

Actual

Forecast

2012q3

2012q4

2013q1

2013q2

2013q3

2013q4

2014q1

2014q2

NET PERS INCOME TAX

Withheld
Quarterly
Annual
Less: Refunds
Less: School Aid
Camp Fund

1610.00
1894.00
190.00
41.60
515.60
494.50
1.00

1872.65
2081.71
86.20
53.64
348.90
528.34
0.00

1744.34
1914.93
185.66
90.94
447.20
521.47
0.00

2376.25
1863.09
283.01
637.35
407.20
660.16
0.00

1781.50
1909.88
197.68
42.64
368.70
511.82
1.00

1964.79
2167.87
87.75
54.67
345.50
549.89
0.00

1837.69
1991.41
193.99
94.99
442.70
543.00
0.00

2515.56
1939.20
296.55
682.91
403.10
694.98
0.00

GFGP INCOME TAX

1114.50

1344.31

1222.87

1716.09

1268.68

1414.89

1294.69

1820.58

GROSS SALES TAX

Auto Sales
Other Sales
Less: Local Dist
School Aid
Comp Trans
Other Trans
Health Init

1817.50
220.70
1596.80
180.70
1322.10
23.80
0.00
2.25

1808.70
192.34
1616.36
185.78
1315.26
21.78
0.00
2.25

1659.30
202.93
1456.37
185.04
1205.88
22.54
0.00
2.25

1802.40
223.50
1578.90
170.03
1310.72
24.00
0.00
2.25

1878.24
241.85
1636.39
184.38
1366.26
25.31
110.00
2.25

1862.62
208.33
1654.29
191.99
1354.46
22.92
0.00
2.25

1703.98
213.40
1490.58
190.56
1238.34
23.28
0.00
2.25

1853.04
234.19
1618.86
174.62
1347.54
24.76
0.00
2.25

GFGP SALES TAX

288.65

283.63

243.59

295.40

190.05

291.00

249.55

303.87

GROSS USE TAX

Less: School Aid

295.90
98.60

309.34
103.11

298.63
99.54

322.99
107.66

321.33
107.11

317.94
105.98

310.71
103.57

337.14
112.38

GFGP USE TAX

197.30

206.23

199.09

215.33

214.22

211.96

207.14

224.76

GROSS CIGARETTE TAX

Less: School Aid
Medicaid Trust Fund
Other Health Prog

254.40
101.50
85.50
16.80

230.85
92.11
77.57
15.24

217.35
86.72
73.03
14.35

237.51
94.77
79.80
15.68

244.38
97.51
82.11
16.13

222.61
88.82
74.80
14.69

210.20
83.87
70.63
13.87

230.10
91.81
77.31
15.19

GFGP CIGARETTE TAX

50.60

45.94

43.25

47.26

48.63

44.30

41.83

45.79

GROSS MICH BUS TAX

Less: School Aid

763.60
0.00

0.00
0.00

0.00
0.00

0.00
0.00

-527.40
0.00

0.00
0.00

0.00
0.00

0.00
0.00

GFGP MICH BUS TAX

763.60

0.00

0.00

0.00

-527.40

0.00

0.00

0.00

RSQE Forecast

Table 5
Selected State of Michigan Tax Revenues by Fiscal Years

16 November 2012

(Millions of Current Dollars, NSA)

Forecast

Fiscal Years

Percent Changes

2014q3

2014q4

2012

2013

2014

2012-2013

2013-2014

NET PERS INCOME TAX

Withheld
Quarterly
Annual
Less: Refunds
Less: School Aid
Camp Fund

1872.87
1987.04
207.04
43.89
365.10
532.90
1.00

2051.00
2256.81
90.04
56.05
351.90
572.17
0.00

6949.50
7698.10
702.30
692.20
2143.10
2115.30
1.00

7774.74
7769.62
752.54
824.58
1572.00
2221.79
1.00

8190.91
8085.52
785.33
876.45
1556.40
2320.78
1.00

11.87
0.93
7.15
19.12
-26.65
5.03
0.00

5.35
4.07
4.36
6.29
-0.99
4.46
0.00

GFGP INCOME TAX

1338.97

1478.83

4833.10

5551.95

5869.13

14.87

5.71

GROSS SALES TAX

Auto Sales
Other Sales
Less: Local Dist
School Aid
Comp Trans
Other Trans
Health Init

1933.00
254.48
1678.52
189.56
1406.07
26.21
0.00
2.25

1920.89
219.01
1701.88
197.60
1396.84
23.68
0.00
2.25

6977.70
836.90
6140.80
710.80
5074.10
92.00
0.00
9.00

7148.63
860.63
6288.01
725.23
5198.12
93.63
110.00
9.00

7352.65
910.40
6442.24
746.74
5346.40
97.17
0.00
9.00

2.45
2.83
2.40
2.03
2.44
1.77
NC
0.00

2.85
5.78
2.45
2.97
2.85
3.78
-100.00
0.00

GFGP SALES TAX

308.91

300.52

1091.85

1012.66

1153.34

-7.25

13.89

GROSS USE TAX

Less: School Aid

335.46
111.82

329.65
109.88

1172.40
390.80

1252.30
417.43

1301.25
433.75

6.81
6.81

3.91
3.91

GFGP USE TAX

223.64

219.77

781.70

834.86

867.50

6.80

3.91

GROSS CIGARETTE TAX

Less: School Aid
Medicaid Trust Fund
Other Health Prog

237.14
94.62
79.68
15.65

215.31
85.91
72.35
14.21

963.40
384.40
323.70
63.60

930.10
371.11
312.51
61.39

900.05
359.12
302.42
59.40

-3.46
-3.46
-3.46
-3.48

-3.23
-3.23
-3.23
-3.23

GFGP CIGARETTE TAX

47.19

42.85

191.70

185.09

179.11

-3.45

-3.23

GROSS MICH BUS TAX

Less: School Aid

-613.90
0.00

0.00
0.00

763.60
0.00

-527.40
0.00

-613.90
0.00

-169.07
NC

16.40
NC

GFGP MICH BUS TAX

-613.90

0.00

763.60

-527.40

-613.90

-169.07

16.40

Non-zero Adjustment Constants: 1 of 1

2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

A.AEQGM

A.AEQPM

A.AFDC

A.BLDPER

A.ECCM

A.EFINM

A.EINFM

A.EMFOM

A.EMIM

A.EMRESM

-90.000
-90.000
-90.000
-90.000
-90.000
-88.000
-86.000
-86.000
-86.000

500.000
490.000
465.000
440.000
420.000
400.000
380.000
360.000
340.000

-3.500
-7.200
1.000
0.310
2.400
-2.500
-2.000
0.300
2.400

-1.630
-1.630
-1.630
-1.630
-1.630
-1.630
-1.630
-1.630
-1.630

5.600
5.600
5.600
5.600
5.600
5.300
5.000
4.800
4.600

-2.300
-2.300
-2.300
-2.300
-2.300
-2.300
-2.300
-2.300
-2.300

-0.500
-0.100
-0.100
-0.100
-0.100
-0.100
-0.100
-0.100
-0.100

9.500
9.500
9.500
9.500
9.500
9.500
9.500
9.500
9.500

0.750
0.750
0.750
0.775
0.800
0.825
0.850
0.850
0.850

-17.000
-17.000
-17.000
-17.000
-17.000
-17.000
-17.000
-17.000
-17.000

A.EMTEQM

A.ESBM

A.ESHM

A.ESLM

A.ESOM

A.ETTUM

A.HOUSEM

A.HRSM

A.LFM

A.PAAAGA

2.900
6.500
6.500
6.500
6.500
6.500
6.500
6.500
6.500

39.000
39.000
39.000
38.000
37.000
36.000
35.000
34.000
33.000

-3.000
-2.400
-2.400
-2.400
-2.400
-2.400
-2.400
-2.400
-2.400

-3.900
-4.300
-4.100
-4.100
-4.100
-4.100
-4.100
-4.100
-4.100

0.000
-0.300
-0.300
-0.300
-0.300
-0.300
-0.300
-0.300
-0.300

-0.700
-0.800
-0.800
-0.800
-0.800
-0.800
-0.800
-0.800
-0.800

-16.000
-21.000
-19.000
-18.000
-17.000
-16.000
-16.000
-16.000
-16.000

2.100
2.000
2.000
2.000
2.000
2.000
2.000
2.000
2.000

-13.000
-13.000
-13.000
-13.000
-13.000
-13.000
-13.000
-13.000
-13.000

-0.100
0.020
-0.020
-0.020
-0.020
-0.020
-0.020
-0.020
-0.020

A.PDIESE

A.PSTKNR

A.SEVNR

A.SEVR

A.STKNR0

A.STKR05

A.TBWMNS

A.TCIGMN

A.TCTF

A.TDIESE

15.000
15.000
15.000
15.000
15.000
15.000
15.000
15.000
15.000

-1.000
0.000
0.000
0.000
-0.700
0.000
0.000
0.000
-0.700

0.000
0.000
-1.400
0.000
0.000
0.000
-0.900
0.000
0.000

0.000
0.000
10.000
0.000
0.000
0.000
10.000
0.000
0.000

7.300
0.000
0.000
0.000
7.300
0.000
0.000
0.000
7.300

-2.200
0.000
0.000
0.000
-2.200
0.000
0.000
0.000
-2.200

1.650
0.550
2.050
1.450
1.700
0.600
2.100
1.500
1.750

-24.000
-9.500
-19.500
-17.000
-26.500
-12.000
-22.000
-19.500
-29.500

8.100
8.100
8.100
8.100
8.100
8.100
8.100
8.100
8.100

-3.550
-3.550
-3.550
-3.550
-3.800
-3.800
-3.800
-3.800
-4.050

A.TGASMN

A.TLIQMN

A.TOILMN

A.TRET

A.TRSNVM

A.TRSVM9

A.TSEP

A.TUPM

A.TUSEMN

A.TVEHRE

3.000
3.000
3.000
3.000
3.000
3.000
3.000
3.000
3.000

3.400
2.800
4.100
2.500
3.500
2.900
4.200
2.600
3.600

-0.400
-0.400
-0.400
-0.400
-0.400
-0.400
-0.400
-0.400
-0.400

2.000
2.000
2.000
2.000
-1.000
-1.000
-1.000
-1.000
-4.000

-51.000
46.000
-23.000
-9.000
-52.000
45.000
-24.000
-10.000
-52.000

11.000
-6.000
-9.000
7.000
9.000
-8.000
-11.000
5.000
8.000

0.000
0.000
0.000
-100.000
0.000
0.000
0.000
-101.000
0.000

0.000
0.000
0.000
-5.250
0.000
0.000
0.000
-5.750
0.000

-21.500
-26.500
-42.500
-43.000
-28.000
-26.000
-43.500
-44.500
-30.500

0.000
0.000
0.000
16.500
0.000
0.000
0.000
11.000
0.000

A.TYAMNS

A.TYQMNS

A.TYWM

A.WM

A.WUS

A.YENTM

A.YOLM

A.YPRM

A.YUCTRM

14.000
12.800
111.000
3.900
14.300
13.300
133.000
4.100
14.600

12.000
-31.000
7.900
8.900
11.800
-31.100
7.900
8.900
10.200

73.900
104.000
88.700
129.400
76.000
104.800
89.600
130.300
76.600

-0.650
-0.700
-0.700
-0.700
-0.700
-0.700
-0.700
-0.710
-0.720

-0.050
-0.023
-0.030
-0.030
-0.030
-0.030
-0.030
-0.030
-0.030

22.600
22.600
22.600
22.600
22.600
22.600
22.600
22.600
22.600

13.000
13.000
13.000
13.000
13.000
13.000
13.000
13.000
13.000

-7.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

-42.000
-37.000
-32.000
-30.000
-28.000
-26.000
-24.000
-22.000
-20.000

Exogenous Variables: 1 of 5

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

ADJRS

BIG3SHR

BONUSQ

CDVA05

CDVT05

D00ON

D01Q1

D02ON

D03Q2ON

D1

464.500
469.080
473.700
478.370
483.080
487.840
492.650
497.500
502.400
507.350

43.830
44.200
44.400
44.600
44.800
45.000
45.000
45.000
45.000
45.000

59.600
71.100
82.800
148.000
82.800
94.300
76.400
144.400
76.400
87.900

88.100
89.906
90.764
91.252
93.049
94.612
94.269
95.418
97.367
98.389

130.600
133.905
136.362
138.613
141.490
143.869
143.408
145.188
148.195
149.739

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

0.000
0.000
1.000
0.000
0.000
0.000
1.000
0.000
0.000
0.000

D2

D3

D4

D6973

D7478.1

D78

D7885.1

D83.1

D84ON

D85Q2ON

0.000
0.000
0.000
1.000
0.000
0.000
0.000
1.000
0.000
0.000

1.000
0.000
0.000
0.000
1.000
0.000
0.000
0.000
1.000
0.000

0.000
1.000
0.000
0.000
0.000
1.000
0.000
0.000
0.000
1.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

D86Q298Q1

D8790

D87ON

D89ON

D90ON

D93ON

D9499

D95Q4ON

D9799

D9801

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

D98Q201Q1

D98Q3

D99Q3

DAUCON

DEGLM

DESTEMP

DPROPA

DSEAS1

DSEAS2

DSEAS3

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.622
0.621
0.620
0.620
0.619
0.619
0.618
0.618
0.617
0.617

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

1.500
1.500
1.500
1.500
1.500
1.500
1.500
1.500
1.500
1.500

0.000
-1.000
1.000
0.000
0.000
-1.000
1.000
0.000
0.000
-1.000

0.000
-1.000
0.000
1.000
0.000
-1.000
0.000
1.000
0.000
-1.000

1.000
-1.000
0.000
0.000
1.000
-1.000
0.000
0.000
1.000
-1.000

Exogenous Variables: 2 of 5

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

DSTKMI

DTCASINO

DTIME

DTRSNVNS

DTUSEMNS

DTUSEPDC

DYDADJ

DYDMADJ

DYOUTH1

EGM

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

227.000
228.000
229.000
230.000
231.000
232.000
233.000
234.000
235.000
236.000

-40.300
-41.700
-41.000
-41.400
-41.700
-43.000
-42.200
-42.600
-43.000
-44.300

13.500
13.500
13.500
13.500
13.500
13.500
13.500
13.500
13.500
13.500

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
9.750
7.250
4.750
2.250
0.000
0.000
0.000
0.000

0.000
0.000
68.250
50.750
33.250
15.750
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

612.600
608.600
607.600
606.600
605.600
601.600
601.100
600.600
600.100
599.100

EGOV

EMP

G05

GAS

GAUTO05

GDP05

GTRMCQ

GTROF

GTRSL

GTRUCK05

23.589
23.595
23.582
23.575
23.597
23.620
23.642
23.670
23.698
23.725

133.421
133.909
134.394
134.888
135.395
135.928
136.470
137.021
137.629
138.249

2501.800
2483.214
2477.631
2472.161
2467.686
2461.234
2457.417
2452.232
2457.066
2454.899

32.090
35.130
36.840
29.610
30.160
33.020
34.630
27.830
28.350
31.040

131.400
132.842
132.691
135.648
140.127
144.168
145.801
147.844
150.699
152.433

13616.200
13662.421
13735.415
13810.077
13897.939
13990.106
14075.756
14164.902
14272.499
14372.547

502.980
509.200
515.400
521.700
528.100
534.600
541.200
547.800
554.500
561.300

1703.200
1729.900
1751.680
1768.160
1784.810
1798.630
1825.990
1843.300
1860.800
1879.270

558.400
564.790
561.190
562.580
566.760
570.960
607.190
611.700
616.230
620.810

262.100
257.174
263.061
266.851
271.377
275.759
276.274
279.162
284.615
288.393

IBFNC05

IPDIE05

IRC05

JCLH

JIPTOT

JQLH

JUCBENLV

MFRACSIC

MGNOIL05

MICHFRAC

346.300
347.685
350.019
354.701
360.241
366.660
374.297
381.851
389.964
398.824

163.800
167.843
170.943
173.037
175.278
177.628
179.825
181.629
183.624
185.981

371.600
387.333
404.763
424.933
447.805
471.641
496.193
520.737
543.900
567.041

121.595
122.415
123.345
124.285
125.221
126.155
127.160
128.123
129.110
130.123

97.221
97.168
97.544
98.054
98.693
99.421
100.148
100.898
101.783
102.653

111.786
112.036
112.322
112.603
112.922
113.254
113.497
113.774
114.142
114.453

419.500
420.700
421.800
422.900
424.100
425.200
426.400
427.500
428.600
429.800

0.295
0.295
0.295
0.295
0.295
0.295
0.295
0.295
0.295
0.295

1690.500
1689.280
1711.208
1737.874
1769.081
1802.834
1835.875
1871.527
1911.305
1948.126

0.210
0.210
0.210
0.210
0.210
0.210
0.210
0.210
0.210
0.210

MIVSHR

MPG

MPOP

MPOP18

MPOPCS

NTSBMNS

OIL

PC

PCDV

PCIG

3.750
3.750
3.750
3.750
3.750
3.750
3.750
3.750
3.750
3.750

28.600
28.800
28.800
28.800
28.800
29.000
29.000
29.000
29.000
29.200

9880.000
9881.000
9882.000
9884.000
9885.000
9886.000
9887.000
9889.000
9890.000
9891.000

7622.000
7630.000
7638.000
7646.000
7652.000
7658.000
7665.000
7672.000
7678.000
7684.000

124.683
126.513
128.369
130.253
132.164
134.103
136.071
138.068
140.094
142.150

-57.300
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

1.690
1.710
1.850
1.880
1.770
1.800
1.940
1.970
1.860
1.890

116.008
116.453
116.944
117.451
117.948
118.440
118.939
119.448
119.966
120.491

109.125
109.265
109.537
109.916
110.391
110.973
111.582
112.165
112.731
113.325

858.520
863.840
869.190
874.570
879.980
885.430
892.000
898.620
905.280
912.000

Exogenous Variables: 3 of 5

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

PCNGO

PCPIB

PCPISA

PGAS.C

PHCS

PHNEWMW

PHOUSEM

PINC

PIRC

PLIQUOR

163.825
164.466
164.232
164.687
165.083
165.372
165.888
166.392
166.823
167.201

252.420
253.670
254.930
256.200
257.470
258.750
260.030
261.320
262.620
263.920

230.080
231.086
232.228
233.385
234.488
235.562
236.644
237.791
238.993
240.220

2.150
2.810
3.330
3.370
3.410
3.450
3.500
3.540
3.580
3.630

131.080
131.080
131.406
132.059
132.714
133.373
134.035
134.700
135.368
136.040

256.800
242.000
224.220
232.910
260.010
245.630
228.140
236.980
264.560
249.930

151.440
151.270
144.890
153.420
153.330
153.920
147.790
156.490
156.400
157.000

131.360
131.538
131.785
132.212
132.746
133.360
134.029
134.745
135.500
136.292

104.416
104.940
105.294
105.612
105.953
106.290
106.664
107.099
107.560
108.040

230.960
232.110
233.260
234.420
235.580
236.750
237.920
239.100
240.290
241.480

POIL.C

POTHRCRU

PPNF

PVEH

PWTI

QUARTER

RDEPNR

RDEPR

RGAS

RHSAVE

81.120
83.030
82.450
82.690
82.920
83.160
83.870
84.580
85.290
86.000

361.900
370.700
374.353
378.041
381.766
385.528
389.327
393.163
397.037
400.949

114.110
114.709
115.329
115.962
116.595
117.213
117.793
118.354
118.901
119.449

31.000
31.000
31.620
31.620
31.620
31.620
32.411
32.411
32.411
32.411

92.220
87.867
87.250
87.500
87.750
88.000
88.750
89.500
90.250
91.000

2012.300
2012.400
2013.100
2013.200
2013.300
2013.400
2014.100
2014.200
2014.300
2014.400

0.000
2.815
0.000
0.000
0.000
2.815
0.000
0.000
0.000
2.815

0.000
1.477
0.000
0.000
0.000
1.477
0.000
0.000
0.000
1.477

0.050
0.050
0.050
0.050
0.050
0.050
0.050
0.050
0.050
0.050

3.700
3.871
2.887
2.919
3.052
3.072
2.885
2.942
3.093
3.177

RMORT

ROIL

RTGAS

RTYAM

RTYQM

RTYSANS

RTYWM

RUG

RUM

SERVE05

3.550
3.398
3.434
3.468
3.543
3.669
3.804
3.897
3.979
4.051

0.066
0.066
0.066
0.066
0.066
0.066
0.066
0.066
0.066
0.066

19.000
19.000
19.000
19.000
19.000
19.000
19.000
19.000
19.000
19.000

4.350
4.350
4.325
4.325
4.325
4.325
4.250
4.250
4.250
4.250

4.350
4.325
4.250
4.250
4.250
4.250
4.250
4.250
4.250
4.250

0.230
0.230
0.230
0.230
0.230
0.230
0.230
0.230
0.230
0.230

4.350
4.250
4.250
4.250
4.250
4.250
4.250
4.250
4.250
4.250

8.050
7.853
7.773
7.705
7.669
7.621
7.553
7.467
7.353
7.231

7.550
7.343
7.282
7.215
7.185
7.141
7.074
6.986
6.862
6.730

8458.100
8478.686
8506.582
8541.473
8582.745
8625.818
8666.321
8709.760
8756.499
8804.391

SP500

STKMFAC

STRPFRAC

STRS2013

STRSMNS

TCASINO

TCIGNRT

TCIGRT

TCIGSART

TCIGSRT

1402.210
1429.333
1443.000
1471.033
1499.610
1528.742
1558.440
1588.715
1619.578
1651.041

0.000
3.155
0.000
0.000
0.000
3.137
0.000
0.000
0.000
3.118

0.342
0.340
0.338
0.336
0.334
0.332
0.330
0.328
0.326
0.324

0.000
0.000
0.000
0.000
110.000
0.000
0.000
0.000
0.000
0.000

2.250
2.250
2.250
2.250
2.250
2.250
2.250
2.250
2.250
2.250

114.700
0.000
0.000
0.000
106.300
0.000
0.000
0.000
109.400
0.000

0.199
0.199
0.199
0.199
0.199
0.199
0.199
0.199
0.199
0.199

200.000
200.000
200.000
200.000
200.000
200.000
200.000
200.000
200.000
200.000

0.399
0.399
0.399
0.399
0.399
0.399
0.399
0.399
0.399
0.399

0.066
0.066
0.066
0.066
0.066
0.066
0.066
0.066
0.066
0.066

Exogenous Variables: 4 of 5

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

TCPM

TCTFR

TEXEMPT

TICF

TINHMNS

TINPMNS

TINTDLM

TINTMNS

TLOTTERY

TMB

525.600
0.000
0.000
0.000
858.900
0.000
0.000
0.000
932.400
0.000

0.279
0.279
0.279
0.279
0.279
0.279
0.279
0.279
0.279
0.279

3700.000
3950.000
3950.000
3950.000
3950.000
3950.000
4000.000
4000.000
4000.000
4000.000

40.900
0.000
0.000
0.000
42.000
0.000
0.000
0.000
43.500
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

300.000
0.000
0.000
0.000
311.400
0.000
0.000
0.000
319.200
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

770.000
0.000
0.000
0.000
744.700
0.000
0.000
0.000
739.000
0.000

763.600
0.000
0.000
0.000
-527.400
0.000
0.000
0.000
-613.900
0.000

TMBSAF

TNTGFGP

TOTHMNS

TOTHSAF

TP

TPSL

TRKH

TSEPFRAC

TSIB

TSID

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

467.200
0.000
0.000
0.000
355.000
0.000
0.000
0.000
332.400
0.000

-17.300
0.000
0.000
0.000
-10.500
0.000
0.000
0.000
-7.400
0.000

17.100
0.000
0.000
0.000
17.100
0.000
0.000
0.000
17.100
0.000

1484.200
1502.310
1549.852
1577.328
1597.830
1627.159
1740.838
1773.097
1796.698
1831.491

336.200
340.296
347.847
356.075
354.659
362.222
371.221
380.803
378.823
387.585

0.359
0.335
0.373
0.381
0.385
0.393
0.404
0.415
0.425
0.437

0.000
0.000
0.000
0.979
0.000
0.000
0.000
0.979
0.000
0.000

515.600
519.595
527.816
532.293
536.753
541.332
551.452
556.406
561.743
567.154

953.100
961.122
1095.426
1105.278
1115.100
1125.185
1147.153
1158.058
1169.786
1181.682

TSSBASE

TSSRATE

TUPRT

TVFAC

TYCFMNS

TYDLNS

TYRMNS

TYWSF

VEHL

YAVAFDC

110100.000
110100.000
113700.000
113700.000
113700.000
113700.000
117300.000
117300.000
117300.000
117300.000

0.066
0.066
0.076
0.076
0.076
0.076
0.076
0.076
0.076
0.076

40.000
40.000
40.000
40.000
40.000
40.000
40.000
40.000
40.000
40.000

0.000
0.000
0.000
91.600
0.000
0.000
0.000
92.600
0.000
0.000

1.000
0.000
0.000
0.000
1.000
0.000
0.000
0.000
1.000
0.000

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

515.600
348.900
447.200
407.200
368.700
345.500
442.700
403.100
365.100
351.900

95.367
110.018
98.741
95.820
95.367
110.018
98.741
95.820
95.367
110.018

14.462
14.635
14.702
14.845
15.124
15.346
15.264
15.419
15.699
15.822

1445.850
1260.000
1170.000
1170.000
1170.000
1215.000
1170.000
1170.000
1170.000
1215.000

YD

YFP

YGWS

YNFP

YOL

YOTRM

YP

YPDIV

YPINT

YPRENT

11962.500
12083.299
12055.730
12170.304
12312.098
12441.194
12531.850
12666.828
12828.028
12981.868

60.800
58.844
58.356
56.897
55.717
54.737
53.901
55.177
56.145
56.882

1203.000
1206.883
1211.720
1215.778
1222.376
1229.010
1243.280
1250.293
1257.962
1265.679

1152.100
1170.055
1188.524
1205.136
1223.143
1241.802
1259.842
1278.071
1297.321
1317.028

1176.300
1185.684
1195.944
1206.965
1218.703
1231.062
1244.047
1257.505
1271.459
1285.854

12574.250
12728.200
12702.530
12828.240
12955.200
13062.400
13455.070
13580.210
13706.650
13839.980

13446.700
13585.609
13605.582
13747.632
13909.927
14068.353
14272.688
14439.924
14624.725
14813.359

736.500
751.561
763.783
763.806
773.717
782.076
788.257
795.630
813.270
832.031

987.600
995.173
999.772
1012.785
1023.463
1031.709
1041.147
1050.914
1060.063
1069.779

463.700
475.957
485.203
494.629
504.238
514.034
524.020
534.199
544.577
555.156

Exogenous Variables: 5 of 5

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

YPWS

YSSTRM

YUNB

5721.400
5775.990
5848.909
5925.754
6006.709
6089.193
6172.371
6257.345
6348.819
6440.673

7687.210
7756.520
7968.530
8048.680
8128.820
8208.970
8445.360
8525.780
8606.200
8686.610

75.000
66.200
62.479
62.957
63.928
64.739
65.239
65.457
65.227
64.895

16 November 2012

Endogenous Variables: 1 of 3

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

AEQGM

AEQPM

AFDC

BLDPERM

ECCM

EFINM

EINFM

EMFM

EMFOM

EMICH

12120.000
12179.681
12240.648
12299.274
12361.030
12420.469
12484.034
12548.826
12616.322
12681.201

11950.000
12010.390
12077.092
12163.755
12225.585
12316.093
12387.409
12473.680
12535.198
12612.862

59.301
59.735
53.473
50.665
48.931
50.751
49.855
46.838
45.010
46.733

2.811
3.227
3.664
4.130
4.489
4.788
5.122
5.423
5.638
5.817

120.500
122.229
124.148
126.538
129.159
131.916
134.444
136.799
139.102
141.223

200.100
200.961
201.734
202.503
203.232
203.978
204.645
205.348
206.021
206.726

54.400
53.804
53.728
53.673
53.645
53.614
53.620
53.631
53.665
53.722

526.600
524.745
526.486
528.482
531.066
534.423
537.884
541.084
544.264
547.530

374.600
376.062
377.234
378.303
379.630
381.464
383.429
385.126
386.753
388.510

4231.500
4239.747
4252.455
4265.884
4279.673
4292.870
4308.442
4323.710
4339.771
4355.849

EMIM

EMRESM

EMTEQM

EPM

ESBM

ESHM

ESLM

ESM

ESOM

ETTUM

7.500
7.503
7.453
7.402
7.382
7.383
7.396
7.412
7.405
7.388

239.900
244.184
245.387
246.652
246.927
247.726
247.434
247.900
248.471
249.184

152.100
148.682
149.252
150.179
151.436
152.958
154.455
155.958
157.512
159.020

3379.100
3386.963
3399.468
3412.632
3427.146
3443.545
3459.908
3475.210
3491.200
3507.564

570.500
574.343
577.990
581.754
585.429
589.344
592.684
595.267
598.334
601.654

630.400
630.971
632.433
634.333
636.298
638.293
640.320
642.364
644.424
646.499

380.700
381.735
381.926
382.366
382.977
383.805
384.672
385.692
386.809
388.079

1749.100
1755.357
1760.848
1767.024
1773.386
1780.247
1786.742
1792.678
1799.247
1806.241

167.500
168.308
168.499
168.571
168.683
168.805
169.066
169.354
169.680
170.010

720.900
722.365
725.071
727.010
729.277
731.984
735.177
738.259
741.496
744.733

EWSM

HOUSEM

HRSM

LFM

MVPROD05

MVQLH05

NEWREGM

NEWREGMQ

NTCASINO

NTCIGMNS

3991.600
3995.563
4007.068
4019.232
4032.746
4045.145
4061.008
4075.810
4091.300
4106.664

160.000
163.180
169.500
178.595
181.304
183.001
188.200
194.505
193.103
190.590

43.400
43.432
43.417
43.396
43.455
43.524
43.537
43.576
43.648
43.685

4661.600
4665.472
4670.252
4676.160
4681.946
4688.131
4695.088
4702.931
4711.051
4719.469

82.635
81.903
83.108
84.525
86.416
88.184
88.636
89.671
91.416
92.574

12.518
12.683
12.825
12.970
13.132
13.246
13.181
13.195
13.297
13.326

539.775
0.000
0.000
0.000
569.819
0.000
0.000
0.000
594.046
0.000

556.088
561.364
565.330
570.981
581.599
590.211
587.551
593.757
604.664
609.692

0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000
0.000

50.600
45.940
43.253
47.264
48.631
44.300
41.830
45.790
47.191
42.848

NTMB

NTRSMNS

NTUSEMNS

NTYMNS

PAAAGAS

PCPID

PDIESEL

PSTKNR

PSTKR

REGVAL1

763.600
0.000
0.000
0.000
-527.400
0.000
0.000
0.000
-613.900
0.000

288.650
283.625
243.585
295.398
190.048
291.000
249.554
303.875
308.914
300.520

197.300
206.230
199.085
215.329
214.220
211.958
207.142
224.762
223.641
219.770

1114.500
1344.310
1222.871
1716.093
1268.677
1414.893
1294.689
1820.576
1338.968
1478.827

3.850
3.457
3.515
3.964
3.803
3.506
3.532
3.991
3.833
3.539

216.370
217.226
218.225
219.242
220.207
221.141
222.078
223.074
224.137
225.237

324.700
332.671
321.350
321.881
317.673
332.539
325.257
328.080
325.559
342.418

0.000
119.908
0.000
0.000
0.000
121.385
0.000
0.000
0.000
123.681

0.000
99.696
0.000
0.000
0.000
100.872
0.000
0.000
0.000
102.528

16733.033
0.000
0.000
0.000
18017.669
0.000
0.000
0.000
19253.619
0.000

Endogenous Variables: 2 of 3

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

REGVAL2

REGVAL3

REGVAL4

REGVALR

RUMICH

SEV

SEVNR

SEVR

SPLONG

STCIGMNS

13031.321
0.000
0.000
0.000
14909.132
0.000
0.000
0.000
16053.743
0.000

10176.284
0.000
0.000
0.000
11493.625
0.000
0.000
0.000
13149.855
0.000

8657.570
0.000
0.000
0.000
8975.482
0.000
0.000
0.000
10137.377
0.000

127921.793
0.000
0.000
0.000
127133.680
0.000
0.000
0.000
125634.580
0.000

9.230
9.125
8.946
8.774
8.592
8.431
8.235
8.063
7.881
7.705

0.000
0.000
0.000
343.818
0.000
0.000
0.000
344.789
0.000
0.000

0.000
0.000
0.000
115.130
0.000
0.000
0.000
115.600
0.000
0.000

0.000
0.000
0.000
228.689
0.000
0.000
0.000
229.190
0.000
0.000

0.078
0.078
0.071
0.083
0.088
0.095
0.086
0.074
0.075
0.074

16.800
15.236
14.345
15.676
16.129
14.692
13.873
15.186
15.651
14.211

STKNR

STKNR05

STKR

STKR05

STKRM

TAXVAL

TBWMNS

TCASSAF

TCIGBSF

TCIGMNS

0.000
11938.472
0.000
0.000
0.000
12188.604
0.000
0.000
0.000
12556.287

0.000
9956.320
0.000
0.000
0.000
10041.254
0.000
0.000
0.000
10152.127

0.000
17817.362
0.000
0.000
0.000
18200.154
0.000
0.000
0.000
18768.996

0.000
17871.758
0.000
0.000
0.000
18042.877
0.000
0.000
0.000
18306.152

0.000
562.138
0.000
0.000
0.000
570.939
0.000
0.000
0.000
585.217

0.000
0.000
0.000
314.938
0.000
0.000
0.000
319.275
0.000
0.000

14.500
12.170
10.447
14.128
14.477
12.164
10.440
14.107
14.453
12.160

114.700
0.000
0.000
0.000
106.300
0.000
0.000
0.000
109.400
0.000

85.500
77.567
73.031
79.803
82.111
74.798
70.627
77.313
79.680
72.346

254.400
230.855
217.354
237.508
244.379
222.613
210.199
230.098
237.143
215.315

TCIGSAF

TCTF

TDIESEL

TGASMNS

TGFGP

TGFGPRV

TLIQMNS

TOILMNS

TRESM

TRET

101.500
92.111
86.724
94.766
97.507
88.823
83.869
91.809
94.620
85.911

23.800
21.784
22.537
24.001
25.307
22.922
23.283
24.761
26.205
23.682

27.800
27.479
23.395
27.152
29.325
27.816
23.920
27.705
29.983
28.403

210.300
203.342
188.056
206.457
212.046
204.966
189.739
208.417
214.134
207.167

3260.150
1916.339
1742.702
2312.657
2450.395
1999.733
1827.764
2434.264
2646.419
2080.385

3727.350
1916.339
1742.702
2312.657
2805.395
1999.733
1827.764
2434.264
2978.819
2080.385

10.100
11.414
8.999
10.953
10.241
11.534
9.105
11.054
10.353
11.668

11.700
12.651
14.461
13.491
13.154
13.883
15.003
14.102
13.800
14.592

7889.690
7968.840
8227.341
8347.368
8473.183
8605.025
9295.359
9431.087
9572.163
9720.697

49.000
37.082
32.178
40.541
48.008
39.010
34.765
45.484
53.946
42.515

TRSDLNS

TRSMNS

TRSNVADJ

TRSNVMNS

TRSSANS

TRSVADJ

TRSVM05

TRSVMN05

TRSVMNS

TSAF

180.700
185.780
185.040
170.030
184.380
191.994
190.562
174.618
189.564
197.600

1817.500
1808.698
1659.297
1802.397
1878.240
1862.624
1703.985
1853.042
1932.999
1920.895

1091.400
1105.370
998.245
1080.198
1118.725
1131.527
1021.854
1107.637
1147.678
1164.122

1596.800
1616.355
1456.368
1578.897
1636.387
1654.290
1490.581
1618.856
1678.517
1701.883

1322.100
1315.259
1205.885
1310.717
1366.256
1354.457
1238.335
1347.537
1406.066
1396.843

129.700
141.248
123.058
117.497
140.517
150.637
127.037
120.646
144.786
155.071

194.600
211.871
184.586
176.245
210.776
225.955
190.555
180.969
217.179
232.607

202.200
176.033
185.261
203.337
219.086
187.734
191.252
208.788
225.742
193.260

220.700
192.343
202.930
223.500
241.852
208.333
213.403
234.186
254.482
219.012

4045.500
2087.321
1954.797
2224.798
4096.079
2149.697
2012.647
2303.250
4193.808
2218.994

Endogenous Variables: 3 of 3

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

TSAFCONS

TSEP

TSIM

TUPM

TUSEADJ

TUSEMNS

TUSESANS

TVEHREG

TYAMNS

TYMNS

4815.500
2087.321
1954.797
2224.798
4840.779
2149.697
2012.647
2303.250
4932.808
2218.994

1797.000
0.000
0.000
0.000
1789.732
0.000
0.000
0.000
1814.103
0.000

7032.100
7053.037
8028.010
8074.897
8131.525
8188.702
8327.222
8380.590
8443.403
8502.302

58.200
0.000
0.000
0.000
58.547
0.000
0.000
0.000
58.798
0.000

188.290
197.230
190.085
206.329
205.220
202.958
198.142
215.762
214.641
210.770

295.900
309.344
298.628
322.993
321.330
317.938
310.713
337.142
335.461
329.654

98.600
103.115
99.543
107.664
107.110
105.979
103.571
112.381
111.820
109.885

882.600
0.000
0.000
0.000
902.648
0.000
0.000
0.000
921.146
0.000

41.600
53.640
90.944
637.348
42.645
54.667
94.990
682.909
43.889
56.053

1610.000
1872.650
1744.340
2376.250
1781.502
1964.788
1837.691
2515.560
1872.867
2050.999

TYQMNS

TYSANS

TYWM

TYWMNS

UMICH

WM

WSGM

WSM

WSPM

WUS

190.000
86.196
185.661
283.008
197.679
87.748
193.992
296.554
207.040
90.039

494.500
528.341
521.469
660.157
511.825
549.895
543.001
694.984
532.900
572.173

1986.000
1892.158
1939.351
1944.368
2002.661
1970.471
2016.801
2023.791
2083.571
2051.307

1894.000
2081.715
1914.934
1863.093
1909.878
2167.873
1991.409
1939.197
1987.039
2256.807

430.100
425.724
417.797
410.276
402.273
395.261
386.647
379.221
371.280
363.621

20.790
20.758
20.819
20.893
20.980
21.074
21.170
21.260
21.356
21.449

7424.712
7412.554
7437.418
7460.739
7485.840
7472.154
7504.153
7536.825
7571.055
7597.307

47805.000
48091.303
48493.105
48971.153
49384.708
49883.170
50363.445
50885.486
51333.936
51837.731

40380.245
40678.749
41055.687
41510.414
41898.868
42411.016
42859.292
43348.661
43762.881
44240.424

19.140
19.181
19.261
19.348
19.438
19.528
19.623
19.717
19.812
19.909

YA

YAFDC

YDM

YDM824

YDM824AJ

YDMADJ

YENTM

YENTUS

YOLM

YPADJM

2601.558
2622.124
2638.831
2664.649
2693.996
2736.131
2707.907
2734.396
2766.622
2807.930

85.740
75.266
62.563
59.278
57.249
61.663
58.330
54.800
52.662
56.781

83371.895
84183.662
83807.245
84601.837
85329.149
86193.998
86782.624
87650.757
88450.424
89413.737

38532.095
38753.992
38404.111
38588.316
38749.502
38976.914
39077.537
39292.286
39462.707
39697.576

38532.095
38753.992
38435.386
38611.464
38764.601
38984.036
39077.537
39292.286
39462.707
39697.576

83371.895
84183.662
83875.495
84652.587
85362.399
86209.748
86782.624
87650.757
88450.424
89413.737

6663.000
6766.038
6874.372
6970.620
7074.626
7182.276
7286.687
7396.689
7511.310
7627.690

1212.900
1228.899
1246.880
1262.033
1278.860
1296.538
1313.744
1333.248
1353.466
1373.909

11565.000
11623.174
11719.955
11796.891
11880.560
11966.918
12089.102
12178.646
12275.191
12367.543

79361.485
80004.553
80752.471
81521.513
82285.445
83114.949
83952.896
84815.242
85674.477
86595.999

YPERM

YPERM824

YPM

YPM824

YPRM

YPRUS

YQ

YTM824

YTRM

YUCTRM

82081.939
82798.330
83249.290
83766.405
84315.589
84924.809
85538.737
86207.147
86985.738
87813.059

38223.494
38398.882
38456.802
38532.017
38624.264
38716.385
38827.404
38958.491
39134.579
39325.937

93247.585
94044.660
93973.937
94893.573
95804.993
96769.494
98094.783
99105.635
100106.157
101185.742

43096.356
43293.507
43062.930
43282.549
43506.771
43759.152
44171.314
44427.306
44662.985
44924.066

12864.000
13054.959
13191.339
13304.480
13462.471
13594.745
13721.011
13856.921
14051.639
14255.685

2187.800
2222.691
2248.758
2271.220
2301.419
2327.818
2353.423
2380.743
2417.911
2456.966

19527.000
19820.997
20065.711
20275.099
20537.097
20777.020
21007.699
21253.610
21562.949
21883.374

308.602
355.110
-52.691
56.299
125.238
260.528
250.133
333.795
328.128
371.639

20918.200
21093.143
21249.476
21446.957
21651.073
21843.247
22469.110
22670.984
22875.084
23092.045

571.000
533.158
515.853
510.758
509.804
510.214
510.350
510.194
509.571
508.674

Percent Changes at Annual Rate: 1 of 3

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

AEQGM

AEQPM

AFDC

BLDPERM

ECCM

EFINM

EINFM

EMFM

EMFOM

EMICH

2.040
1.984
2.017
1.930
2.024
1.937
2.063
2.092
2.169
2.073

1.557
2.037
2.240
2.901
2.049
2.994
2.336
2.815
1.987
2.501

45.361
2.957
-35.785
-19.406
-13.007
15.732
-6.881
-22.096
-14.715
16.213

36.421
73.691
66.231
61.444
39.578
29.361
30.967
25.682
16.793
13.354

5.848
5.863
6.431
7.925
8.546
8.816
7.889
7.192
6.907
6.239

3.681
1.732
1.547
1.534
1.447
1.477
1.315
1.380
1.318
1.377

10.158
-4.314
-0.558
-0.408
-0.216
-0.226
0.042
0.082
0.252
0.426

1.456
-1.402
1.334
1.525
1.970
2.553
2.616
2.400
2.372
2.422

-4.664
1.571
1.252
1.138
1.411
1.947
2.076
1.781
1.701
1.830

-3.241
0.782
1.204
1.269
1.299
1.239
1.459
1.425
1.494
1.490

EMIM

EMRESM

EMTEQM

EPM

ESBM

ESHM

ESLM

ESM

ESOM

ETTUM

5.516
0.144
-2.606
-2.732
-1.073
0.068
0.672
0.881
-0.388
-0.878

-47.252
7.337
1.985
2.078
0.445
1.301
-0.470
0.755
0.925
1.153

19.417
-8.690
1.541
2.508
3.390
4.083
3.972
3.950
4.045
3.886

0.534
0.934
1.485
1.558
1.712
1.928
1.914
1.781
1.853
1.888

-1.734
2.722
2.564
2.630
2.551
2.702
2.286
1.755
2.077
2.238

0.573
0.363
0.930
1.207
1.245
1.260
1.276
1.283
1.289
1.294

0.527
1.092
0.201
0.461
0.641
0.867
0.907
1.065
1.163
1.319

-0.479
1.439
1.257
1.410
1.448
1.556
1.467
1.336
1.474
1.564

-2.353
1.943
0.454
0.172
0.265
0.290
0.620
0.684
0.771
0.781

-0.166
0.816
1.507
1.074
1.253
1.493
1.756
1.688
1.765
1.758

EWSM

HOUSEM

HRSM

LFM

MVPROD05

MVQLH05

NEWREGM

NEWREGMQ

NTCASINO

NTCIGMNS

0.664
0.398
1.157
1.220
1.352
1.235
1.578
1.466
1.529
1.511

0.000
8.191
16.413
23.254
6.207
3.797
11.857
14.089
-2.853
-5.103

0.927
0.300
-0.141
-0.194
0.541
0.643
0.116
0.360
0.665
0.336

-0.043
0.333
0.411
0.507
0.496
0.529
0.595
0.670
0.692
0.717

-21.855
-3.494
6.013
6.996
9.254
8.442
2.063
4.755
8.013
5.163

-35.162
5.374
4.552
4.582
5.103
3.522
-1.950
0.413
3.128
0.890

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

10.544
3.850
2.856
4.059
7.649
6.055
-1.790
4.292
7.552
3.368

NC
NC
NC
NC
NC
NC
NC
NC
NC
NC

7.443
-32.054
-21.420
42.575
12.084
-31.144
-20.509
43.593
12.821
-32.040

NTMB

NTRSMNS

NTUSEMNS

NTYMNS

PAAAGAS

PCPID

PDIESEL

PSTKNR

PSTKR

REGVAL1

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

-0.552
-6.783
-45.597
116.286
-82.868
449.699
-45.914
119.846
6.800
-10.433

-22.821
19.370
-13.153
36.852
-2.044
-4.157
-8.784
38.617
-1.980
-6.746

-67.990
111.679
-31.526
287.829
-70.130
54.700
-29.892
290.996
-70.742
48.795

8.302
-34.972
6.836
61.708
-15.295
-27.732
3.052
62.882
-14.857
-27.349

3.765
1.591
1.852
1.878
1.772
1.708
1.705
1.805
1.920
1.979

5.214
10.187
-12.933
0.662
-5.128
20.075
-8.476
3.517
-3.038
22.379

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

Percent Changes at Annual Rate: 2 of 3

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

REGVAL2

REGVAL3

REGVAL4

REGVALR

RUMICH

SEV

SEVNR

SEVR

SPLONG

STCIGMNS

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

40.354
-4.473
-7.622
-7.478
-8.033
-7.283
-8.978
-8.079
-8.748
-8.655

-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000
NC

-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000
NC

-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000
NC

-17.362
-1.674
-28.166
79.636
28.556
36.401
-33.883
-45.869
7.854
-6.557

7.473
-32.346
-21.420
42.575
12.084
-31.144
-20.509
43.593
12.821
-32.040

STKNR

STKNR05

STKR

STKR05

STKRM

TAXVAL

TBWMNS

TCASSAF

TCIGBSF

TCIGMNS

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

NC
NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC

-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000
NC

15.069
-50.377
-45.707
234.547
10.243
-50.152
-45.734
233.295
10.188
-49.889

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

7.849
-32.260
-21.420
42.575
12.084
-31.144
-20.509
43.593
12.821
-32.040

7.572
-32.191
-21.420
42.575
12.084
-31.144
-20.509
43.593
12.821
-32.040

TCIGSAF

TCTF

TDIESEL

TGASMNS

TGFGP

TGFGPRV

TLIQMNS

TOILMNS

TRESM

TRET

7.420
-32.176
-21.420
42.575
12.084
-31.144
-20.509
43.593
12.821
-32.040

-4.887
-29.812
14.564
28.615
23.602
-32.692
6.445
27.925
25.448
-33.304

10.739
-4.541
-47.455
81.427
36.052
-19.049
-45.313
79.969
37.174
-19.467

-2.803
-12.591
-26.847
45.268
11.277
-12.701
-26.565
45.580
11.433
-12.394

516.763
-88.062
-31.608
210.136
26.038
-55.645
-30.210
214.623
39.689
-61.811

953.825
-93.013
-31.608
210.136
116.537
-74.183
-30.210
214.623
124.236
-76.210

-17.574
63.076
-61.355
119.449
-23.563
60.876
-61.162
117.246
-23.051
61.317

-38.277
36.714
70.680
-24.232
-9.621
24.072
36.377
-21.941
-8.290
25.007

3.690
4.074
13.621
5.964
6.167
6.371
36.162
5.970
6.119
6.353

151.760
-67.200
-43.303
151.970
96.643
-56.403
-36.926
193.005
97.890
-61.425

TRSDLNS

TRSMNS

TRSNVADJ

TRSNVMNS

TRSSANS

TRSVADJ

TRSVM05

TRSVMN05

TRSVMNS

TSAF

38.732
11.728
-1.584
-28.708
38.278
17.570
-2.949
-29.496
38.888
18.065

11.957
-1.923
-29.168
39.221
17.924
-3.284
-29.957
39.855
18.409
-2.481

14.532
5.219
-33.485
37.109
15.048
4.657
-33.489
38.049
15.263
5.856

14.872
4.989
-34.092
38.144
15.380
4.449
-34.086
39.127
15.577
5.686

12.058
-2.054
-29.339
39.577
18.057
-3.410
-30.130
40.220
18.539
-2.598

43.511
40.658
-42.388
-16.887
104.558
32.070
-49.418
-18.654
107.422
31.587

43.497
40.514
-42.388
-16.887
104.558
32.070
-49.418
-18.654
107.422
31.587

-5.537
-42.555
22.678
45.120
34.770
-46.085
7.709
42.034
36.657
-46.282

-6.601
-42.311
23.902
47.138
37.118
-44.940
10.096
45.022
39.440
-45.141

1140.325
-92.913
-23.078
67.786
1048.976
-92.414
-23.165
71.512
999.184
-92.162

Percent Changes at Annual Rate: 3 of 3

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

2012q3
2012q4
2013q1
2013q2
2013q3
2013q4
2014q1
2014q2
2014q3
2014q4

RSQE Forecast

16 November 2012

TSAFCONS

TSEP

TSIM

TUPM

TUSEADJ

TUSEMNS

TUSESANS

TVEHREG

TYAMNS

TYMNS

2390.074
-96.470
-23.078
67.786
2141.293
-96.111
-23.165
71.512
2003.841
-95.905

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

1.789
1.196
67.852
2.357
2.835
2.842
6.940
2.588
3.032
2.820

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

-23.831
20.387
-13.720
38.818
-2.132
-4.336
-9.160
40.602
-2.062
-7.021

-22.922
19.451
-13.153
36.852
-2.044
-4.157
-8.784
38.617
-1.980
-6.746

-23.123
19.612
-13.153
36.852
-2.044
-4.157
-8.784
38.617
-1.980
-6.746

NC
-100.000
NC
NC
NC
-100.000
NC
NC
NC
-100.000

-99.995
176.428
726.323
241113.777
-99.998
170.043
811.614
267046.779
-99.998
166.067

-65.313
83.030
-24.717
244.385
-68.408
47.951
-23.471
251.115
-69.275
43.825

TYQMNS

TYSANS

TYWM

TYWMNS

UMICH

WM

WSGM

WSM

WSPM

WUS

-74.586
-95.764
2052.484
439.896
-76.196
-96.118
2288.856
446.109
-76.242
-96.423

-58.526
30.314
-5.102
156.847
-63.868
33.239
-4.921
168.347
-65.431
32.901

6.517
-17.603
10.356
1.039
12.542
-6.276
9.742
1.394
12.349
-6.051

4.538
45.937
-28.397
-10.397
10.429
66.002
-28.796
-10.082
10.240
66.400

39.859
-4.008
-7.243
-7.009
-7.577
-6.792
-8.437
-7.464
-8.117
-8.000

4.754
-0.606
1.167
1.425
1.691
1.807
1.831
1.711
1.808
1.761

3.451
-0.653
1.349
1.260
1.353
-0.729
1.724
1.753
1.829
1.394

2.309
2.417
3.384
4.002
3.421
4.099
3.907
4.211
3.572
3.984

2.100
2.990
3.758
4.504
3.796
4.980
4.295
4.646
3.877
4.437

0.629
0.868
1.676
1.822
1.862
1.865
1.959
1.926
1.941
1.974

YA

YAFDC

YDM

YDM824

YDM824AJ

YDMADJ

YENTM

YENTUS

YOLM

YPADJM

1.651
3.200
2.573
3.971
4.479
6.404
-4.063
3.971
4.798
6.107

244.131
-40.619
-52.258
-19.406
-13.007
34.591
-19.928
-22.096
-14.715
35.150

2.284
3.952
-1.777
3.847
3.483
4.116
2.760
4.062
3.700
4.428

-1.428
2.323
-3.563
1.932
1.681
2.368
1.037
2.216
1.746
2.402

-1.428
2.323
-3.248
1.845
1.596
2.284
0.963
2.216
1.746
2.402

2.284
3.952
-1.456
3.758
3.396
4.030
2.685
4.062
3.700
4.428

6.235
6.331
6.560
5.719
6.103
6.227
5.943
6.177
6.344
6.343

6.163
5.381
5.983
4.950
5.441
5.645
5.415
6.072
6.205
6.180

2.440
2.027
3.372
2.652
2.867
2.939
4.147
2.996
3.209
3.044

2.321
3.281
3.792
3.864
3.801
4.094
4.094
4.172
4.114
4.372

YPERM

YPERM824

YPM

YPM824

YPRM

YPRUS

YQ

YTM824

YTRM

YUCTRM

3.055
3.537
2.196
2.508
2.648
2.922
2.923
3.162
3.662
3.859

0.851
1.848
0.605
0.785
0.961
0.957
1.152
1.357
1.820
1.970

2.490
3.463
-0.300
3.972
3.898
4.088
5.592
4.186
4.100
4.384

-1.229
1.842
-2.113
2.056
2.088
2.341
3.821
2.338
2.139
2.359

0.249
6.071
4.245
3.475
4.835
3.988
3.767
4.021
5.740
5.936

0.790
6.533
4.774
4.056
5.425
4.668
4.473
4.725
6.393
6.619

2.243
6.160
5.031
4.240
5.270
4.756
4.516
4.765
5.950
6.078

-88.354
75.330
-99.952
30.337
2348.672
1772.739
-15.031
217.130
-6.621
64.556

2.895
3.387
2.998
3.770
3.862
3.598
11.963
3.643
3.650
3.848

-38.485
-23.989
-12.364
-3.892
-0.745
0.322
0.106
-0.122
-0.487
-0.702