From the Business Desk: Unexpected Predictions for 2023

At the start of a new year, it’s common for business professionals to anticipate economic upheavals for the next 12 months. But these times are normal. Therefore, rather than predicting what will happen in 2023, it seems more appropriate to predict what will not happen.

Will Hall is the business editor of the Portland Press Herald. Gregory Reck/Staff Photographer

I don’t want to be a Debbie Downer. Some of this easing would mean good things for Maine. It’s just that, well, after 2022’s unexpected, seismic shift, rejection seems like a safer bet.

Whose crystal ball a year ago saw Maine heating oil prices rise nearly $6 a gallon — in part because of the invasion of a sovereign nation? Black swans will continue to flock to Maine in 2023. For now, let’s focus on a few things we can avoid. in case.

1. The standoff over lobster regulations isn’t going away anytime soon.

Maine lobstermen vs environmental activists. Protecting Maine’s historic industry while protecting the North Atlantic right whale species. A legal conflict over federal requirements for lobster marsh and seasonal fishing water closures. 2022 has generated a lot of headlines.

The debate over how to balance these often competing interests has been going on for decades. Fortunately for lobstermen, Congress recently passed a Hail-Mary law that means the new regulations won’t go into effect for six years. That might be enough time for lobster technology or whale research to start solving the crisis.

But a lasting, meaningful solution is unlikely this year and likely for many in the future. There is simply too much at stake for both sides, and the issues are too complex to be easily fixed. In the year By 2023, we’ll be trampling crustaceans along the way.

2. The sky is not falling on Maine’s residential real estate market.

Despite declining home sales, Maine ranks better than most states on climate change.

For example, sales nationwide fell more than 35 percent in November, while the number of Maine homes changing hands fell 28.7 percent. And while the median U.S. home price rose 3.2% that month, prices in Maine rose a healthy 8.3% to $325,000.

Tight inventory and rising prices continue to deter some buyers (see below). And after two years of double-digit price increases, the home sales market isn’t looking lucrative for sellers. But compared to the opposite situations elsewhere, it’s probably Maine’s new normal happy medium.

3. The territory shall not be a telework place.

In about the first year of the outbreak, more than 15,000 foreign residents moved to Maine, helping push the population to 1.37 million. The 0.7% increase was the largest in the country and came as the US population grew – just 0.1%. Many new arrivals have migrated from the worst-hit areas of the settlement after learning that the housing office can be a place with high-speed internet access.

They are also finding that their new digs are worth the high price. Those heating oil costs are just the beginning. A growing lack of affordable housing, child care and broadband services is limiting the state’s appeal. And Maine’s state and local tax burden is the 10th-highest in the U.S., according to the independent Tax Foundation.

All of this may help explain why Maine’s population growth rate for 2020-21 has halved from last year, University of New Hampshire researchers said last month. Maine, the way life should be? For telework transplants, that chance may be remote indeed.

4. Marijuana booze doesn’t last.

In the year After sprouting $1.4 million in sales in October 2020, Maine’s legal, recreational cannabis market has grown to, well, you know the words. Monthly adult-use sales rose $17 million last August to $158.9 million in 2022, nearly double sales in 2021.

But demand may be reaching a plateau. Only 62 of Maine’s 483 municipalities have chosen to allow the sale of cannabis within their borders, and only a dozen within the past year. Nationwide, weed is now readily available, prices are falling, and more states are moving toward legalization. At last count, about 21 were on board.

There are also signs that recreational cannabis may be legalized in New Hampshire, the only New England closure. The new competition could hurt sales in Kittery and Elliott’s “Green Mile” and ultimately weaken Maine’s statewide marijuana market. So think twice before you make that bold statement.

5. Even if inflation slows down, Mainers won’t stop hurting.

In the year Inflation was the biggest economic threat for Americans in 2022, but there is good news for 2023. Economists predict that inflation will ease somewhat this year, largely due to the Federal Reserve’s interest rate hikes last year. Indeed, after hitting a 40-year high of 9.1% in June, consumer price index growth has fallen for six months in a row.

In Maine, there may not be much cause for celebration. Inflation hits energy costs especially hard, and Maine is especially vulnerable to them. The state relies on oil for heating more than any other – there’s a theme here – over 60% of Maine homes use oil as their primary heating source. And because we’re a big rural state, Maine is a big buyer of gasoline. Gas prices greatly affect what major dealers pay for trucking goods, which means almost all of them, and we haven’t even paid for inflation.

Do you disagree with these fortune telling words? Drop us a line [email protected]. And check out the Press Herald’s business coverage to see if our predictions hit the mark.

Will Hall is the business editor of the Portland Press Herald.

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