After a slow and steady recovery it is time to officially say goodbye to the effects of The Great Recession. At this time two years ago the national economy experienced stabilizing capital markets, increasing consumer confidence and improving national labor conditions. These trends continued throughout 2015 and in many cases gained traction.
Reflecting back on 2015, the U.S. economy continued to build on the growth felt throughout 2014. At the beginning of the year, the national unemployment rate stood at 5.7 percent, and by November the metric had dropped 70 basis points to 5.0 percent, its lowest level in almost 8 years. U.S. GDP growth continued to expand in the third quarter of 2015 growing by 2.0% with household spending and fixed investments remaining robust but inventories growing slightly less than expected. 2015 ended up as one of the best years of job growth since 1999, adding on average more than 200,000 jobs per month through November. Looking ahead the Bureau of Labor Statistics (BLS) continues to predict the U.S. will return to full employment by 2020 (indicating a 4-5% unemployment rate) with the strongest job growth in healthcare and social assistance.
The New England Economic Project (NEEP) projects an average annual rate of growth for the New England economy of 2.4% through 2018, a rate slightly below the projected national average of 2.7% for the same period. Growth of the regional economy is expected to peak in 2015 at 2.9% and then level off and remain at 2.7 through 2016.
The venture capital investment market spiked in the third quarter of 2015 across the New England region, rising 39% to $2.1 billion across 125 deals according to the latest Money-Tree survey by PricewaterhouseCoopers. This increase in activity allowed the New England region to surge ahead of the NY Metro area by over $300 million in the third quarter. Leading areas on investment in the New England market were once again the biotechnology and software sectors. While the New England region and the NY Metro region remain competitive with each other across this metric, the Silicon Valley region remains the clear front runner, receiving $7.9 billion for the third quarter of 2015 across 337 deals.