Ask our expert - Economy, inflation and interest rates, where do we stand as we close in on the end of the year?

Nov 2, 2022

3 min

Simon Medcalfe, PhD

Everyone is keeping a close eye on the economy. Whether on a global scale or at the kitchen table - it's a topic that is at the top of everybody's mind these day.




Simon Medcalfe, PhD is  the Cree Walker Chair in the Hull College of Business at Augusta University and resident expert on the economy, and he shared his thoughts on where the economy stands as the final months of the year approach.


Q: The Gross Domestic Product report was up, what should we take out of that?


“The GDP was interesting because it was actually up. The first two quarters were negative growth, so the economy had shrank. This time, the growth figure came in at 2.6%, but closer reading suggested it was actually a worse reading then the negative readings we had because consumer spending by firms was essentially flat. The growth was seen in net exports or government spending or things like. Consumers were kind of pulling back a little, which is why earnings were a little lower as well.”


Q: The economy needs to slow down a little, doesn’t it?


“I mean, yes, if you’re thinking about the Fed, that’s what they are worried about right now, inflation, because the economy is so incredibly hot, particularly with regards to prices. They’re raising interest rates with the aim at slowing down the economy. Unemployment is historically very, very low, if not at record levels in different places, so we could probably sustain a little slowing of the economy without impacting the labor market too much and try to get this general inflation under control.”



Q: The economy could use a little unemployment, it’s that kind of counter intuitive?


“Some unemployment is not bad. Economist use to suggest in the long run, the natural rate of unemployment is about 5-6%. Now we have unemployment in the 2-3% range in places. We have a little bit of wiggle room to see that increase.”


Q: What's the difference between frictional and structural unemployment?


"Economist talk about frictional unemployment and structural unemployment. Frictional unemployment is more of a job match or job search problem. So it’s a lack of information. Structural unemployment is because of the changing nature of industry within an economy.

An example being people working in textile manufacturing and it’s hard for them to go straight into computer science coding because they don’t have the skills. This is more long term than frictional and in some cases can be quite detrimental to regions and people.”



Q: The Fed is likely to raise interest rate by .75%, are there signs of this slowing down?


“I think they’ll start slowing that down over time, but I think their projection is about 4.6% and we’re like 3.25% now. They’re looking at all the economic indicators. Not looking at any one or two, but everything. They’re looking at inflation, and have different measure of that. They’re look at the breakdown of inflation like how much of it is due to the war in Ukraine, and what areas of the economy it may be impacting. They’re looking at the labor market, definitely looking at manufacturing output, etc. The one thing they don’t generally look at is financial markets. They would look at the housing market though and different sectors of the real economy, not the financial economy.”


Dr. Simon Medcalfe is a highly regarded economics expert in the Hull College of Business at Augusta University. Medcalfe is available to speak with media regarding the economy and its outlook – simply click on his icon now to arrange an interview today.

Connect with:
Simon Medcalfe, PhD

Simon Medcalfe, PhD

Professor

Dr. Simon Medcalfe is an economist with an emphasis on sports economics, social determinants of health, and the local economy.

Community and Economic DevelopmentSocial Determinants of HealthSports Economics
Powered by

You might also like...

Check out some other posts from Augusta University

When Science Can't Be Repeated: Tackling a Crisis in Research featured image

3 min

When Science Can't Be Repeated: Tackling a Crisis in Research

Science depends on a simple but critical principle: Research findings should be reliable enough that other researchers can reproduce them. But what happens when they can't? Biomedical research is confronting what has become known as the “reproducibility crisis,” with major scientific journals estimating that more than 80% of published biomedical research is negatively affected by defects that can make findings non-reproducible or unusable. Now, researchers at Augusta University are taking a closer look at why research goes wrong – and, more importantly, whether those problems can be prevented before findings are published. Backed by a new $2.5 million R01 grant from the National Institutes of Health, researchers in Augusta University's School of Public Health will identify common research defects and develop strategies to help scientists avoid them. The project is led by E. Andrew Balas, MD, PhD, a professor in the Department of Health Management, Economics, and Policy who has spent more than a decade studying the research process itself. “Research quality is not only a matter of detecting errors after they occur. The critical question is, how can we understand the conditions that produce research defects and develop effective ways to prevent them before they compromise scientific results?”  E. Andrew Balas, MD, PhD The consequences extend well beyond the laboratory. Unreliable findings can influence patient care, waste research funding and send other scientists down paths built on results that were never dependable. They can also contribute to something increasingly important for the scientific community: declining public trust. The Augusta University team plans to create a database of common research defects and examine which stages of the research process are particularly vulnerable. Researchers also envision a tool that could eventually allow scientists to enter information about their methodology and identify potential problems before completing and publishing their work. Wendy Burnett, PhD, an assistant professor in the School of Public Health and co-investigator on the study, summed up the stakes: “Years of work and substantial funding may be invested in studies based on results that were never dependable.”  Wendy Burnett, PhD The interdisciplinary project will also examine the human side of the problem, gathering perspectives from researchers, peer reviewers and journal editors to better understand why research defects happen and what may prevent people from recognizing or addressing them. Ultimately, the research asks a question that goes to the heart of modern science: How can we make research more trustworthy before mistakes become part of the scientific record? After the project is complete, Balas and his team hope the results will ultimately impact science and society in many significant ways. “Research has made wonders in our lives – we have life-saving drugs, we have a lifestyle that is healthier than ever before and so forth. If research could produce more valuable, useful, trustworthy, reproducible results, then we will all be better, and it should also increase public trust in research.” For media covering scientific integrity, biomedical research, public trust in science, research funding, peer review or the reproducibility crisis, this work offers a timely look at how the scientific community can improve not only what it discovers, but how those discoveries are made.

A Silent Disease, a Surprising Discovery: Research Uncovers Chagas Risk in the U.S. featured image

2 min

A Silent Disease, a Surprising Discovery: Research Uncovers Chagas Risk in the U.S.

Chagas disease is often associated with Latin America, but new research from Augusta University is raising questions about how frequently the potentially serious infection may be going undiagnosed in the United States. Jose Vazquez, MD, division chief and professor of medicine in infectious diseases at the Medical College of Georgia at Augusta University, and his team recently tested farmworkers for antibodies associated with Chagas disease as part of a seroprevalence study. Of 155 blood specimens collected, 15 tested positive, a positivity rate of nearly 10%. The finding was particularly notable because Vazquez points to a recent study from Columbia and Greenville, South Carolina, that found a positivity rate of 2% to 3%. Chagas disease is caused by the parasite Trypanosoma cruzi and is found predominantly in Latin America. An estimated 240,000 to 350,000 people are infected in the United States. The disease can be especially difficult to identify because approximately 70% of cases are asymptomatic. When complications do develop, they can include serious cardiac and gastrointestinal problems. Dr. Jose Vazquez studies and treats infectious diseases, including COVID-19, antibiotic-resistant superbugs and fungal infections. View his profile Vazquez's interest in the disease became personal after someone he knew, originally from El Salvador, suffered cardiac arrest and was subsequently diagnosed with Chagas disease and severe cardiomyopathy. That experience helped prompt Vazquez to look more closely at the disease and its potential prevalence among populations in the region. “The reason why I’m doing it is twofold: One is if they’re positive, so we can treat them and maybe prevent these complications.” Jose Vazquez, MD For journalists covering Chagas disease, infectious diseases, health disparities, migrant and farmworker health, disease screening or emerging public health concerns in the United States, Vazquez can provide expert insight into what these findings mean and why greater awareness and screening may be important. Simply click on his profile now to arrange an interview today.

AU Hosts Congressional Hearing on 'Building an AI-Ready America' featured image

3 min

AU Hosts Congressional Hearing on 'Building an AI-Ready America'

The U.S. House Committee on Education and Workforce held its first artificial intelligence field hearing of the year, titled "Building an AI-Ready America: How AI Is Creating Opportunities Across America's Workforce," at the Georgia Cyber Center at Augusta University on July 24. U.S. Rep. Rick W. Allen, who represents Georgia's 12th District and chairs the committee's Subcommittee on Health, Employment, Labor, and Pensions, chaired the hearing. He was joined by U.S. Rep. Joe Wilson of South Carolina and U.S. Rep. Lucy McBath of Georgia. Jeffery Talbert, PhD, chair of Augusta University's Department of Artificial Intelligence and Health at the Medical College of Georgia and a Georgia Research Alliance Eminent Scholar, served as one of four witnesses at the hearing. "Today, we examine how artificial intelligence, AI, is creating economic opportunities for American workers, job creators and our communities," Allen told the committee. "There's no better place to hold this hearing than right here in Augusta." Allen said the combination of the Georgia Cyber Center and Fort Gordon provides the expertise needed to discuss AI. "Fort Gordon is just a short 30-minute drive from where we currently sit," he said. "It hosts the Army Cyber Center of Excellence and is home to Army Cyber School, which trains, educates and develops the Army's Cyberspace and Electronic Warfare workforce. Every year, thousands of people leave Fort Gordon looking for work." He added that the Georgia Cyber Center "was created to meet this growing demand and drive collaboration between academia, government and industry stakeholders to equip a superior cybersecurity workforce with the skills they need." Augusta University President Russell T. Keen told the committee it was an honor for AU's Georgia Cyber Center to host the hearing. "Congressman Allen has long recognized the important role that education, innovation and workforce development play in strengthening our state and our nation," Keen said. He added that AI "will continue to change how we live, how we learn, how we work and how we solve problems," and that Augusta University "intends to lead in that transformation in ways that strengthen our workforce, advance discovery, improve lives, change lives and save lives." Talbert, who has more than 30 years of experience in biomedical informatics, has published approximately 260 times and has led more than 100 funded research projects totaling more than $130 million. He told the committee that in health care, AI is demonstrating its greatest value through augmentation, helping professionals "work more effectively, reducing administrative burdens, improving patient outcomes and expanding workforce capacity." He pointed to ambient documentation technology, which converts clinical conversations into draft notes clinicians review and approve, as one of the industry's most successful AI applications. "Multiple studies show these tools reduce documentation burden, after-hours work and burnout," Talbert said. "One multisystem implementation found clinician burnout fell from approximately 52 percent to 39 percent." He also cited studies showing AI-assisted breast cancer screening detecting approximately 29 percent higher cancer rates, "helping more patients benefit from earlier diagnosis and treatment." America's opportunity, Talbert said, "is not simply to adopt AI, but to lead its responsible development, education and implementation." He pointed to Augusta University's Department of AI and Health, the first of its kind in Georgia, as an example of that approach. Allen closed the hearing by cautioning against a one-size-fits-all approach to AI policy. "The needs of a family farm are not the same as those of a hospital, a manufacturing plant or a small business," he said. "Congress must pursue flexible policies that allow businesses to adopt AI in ways that best suit their industry and workforce." JagWire has the full recap of the hearing and the Augusta Chronicle, Innovation & Entrepreneurs News and Traders Union also covered the field hearing. Augusta University experts in artificial intelligence, healthcare innovation and workforce development are available for interviews. If you're covering similar stories, reach out to schedule time.

View all posts