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The University of Alabama

UA Center Reports Alabama Economy Expected to Grow Slowly in 2016

2016 Q1-FINAL(2)_Page_1TUSCALOOSA, Ala. — Alabama’s economy is expected to grow 1.9 percent in 2016 while the state’s businesses remain relatively cautious about hiring, according to a midyear report released by The University of Alabama’s Center for Economic and Business Research. The expected growth for 2016 is slightly lower than the 2.4 percent grow seen in 2015.

Transportation equipment and wood products related manufacturing and service providing employers will remain the state’s major economic drivers in 2016, according to the report. These include firms in such industries as automotive manufacturing, aerospace, tourism, healthcare, real estate rental and leasing, administrative support and remediation services and biotechnology.

From May 2015 to May 2016, durable goods manufacturing industries in the state lost 800 workers. Job gains in industries were associated with wood products manufacturing (1,000), motor vehicle parts manufacturing (400) and aerospace products and parts manufacturing (200). Electrical equipment, appliance and component manufacturing experienced no change in employment. Among service-providing firms, job gains were predominantly associated with retailing (5,000); professional, scientific and technical services (4,300); administrative support, waste management and remediation services (2,600); finance and insurance (2,400); ambulatory healthcare services (2,000); food services and drinking places (1,800); real estate and rental and leasing (1,600); and hospitals (1,300).

Employment levels in the mining and logging industry declined by 1,200, and overall manufacturing industries in the state gained 2,400 net new jobs.

Overall, the state’s economy will continue to grow at a slightly slower pace in 2016 compared with 2015, at least through the first half of the year; growth should pick up modestly in the second half. Despite the rapid increase in payrolls seen in some sectors of the economy, overall job growth is expected to remain sluggish for some industries, especially those with higher exposure to international trade, mirroring a national trend.

A slight slowdown in economic conditions is also reflected by the business sentiment for the third quarter 2016, measured quarterly by the center’s Alabama Business Confidence Index™.

CBER is a center within The Culverhouse College of Commerce.

View the full report at



The University of Alabama, a student-centered research university, is experiencing significant growth in both enrollment and academic quality. This growth, which is positively impacting the campus and the state's economy, is in keeping with UA's vision to be the university of choice for the best and brightest students. UA, the state's flagship university, is an academic community united in its commitment to enhancing the quality of life for all Alabamians.