Florida TaxWatch remains ‘cautiously optimistic’ in 2021 economic outlook

Florida Tax Watch warned Floridians on Wednesday to be “cautiously optimistic” about the year ahead.

While the 2021 economic preview suggests Florida’s labor market will recover some as vaccine access broadens, the group warned Floridians not to hold their breath.

The report published Wednesday is titled “An Uncertain yet Hopeful Year of Growth.”

“As we close out a tumultuous year for Florida, defined by COVID-19 and its resulting disruptions to everyday life, we consider what may lie ahead,” Florida TaxWatch President and CEO Dominic M. Calabro. “Overall, Florida’s economy in 2021 will be uncertain, influenced largely by pandemic changes, but there is reason to believe next year will be a hopeful year of growth for a state on the road to economic recovery. With several promising vaccines on the horizon and gradually improving labor market conditions, Florida looks poised to undergo the slow but steady process of economic rebuilding over the coming year.”

Florida TaxWatch expects the Leisure and Hospitality industry to grow by 11.9% in 2021.

Meanwhile, the Education and Health Services industry and Financial Activities industry are expected to grow by 8.1%.

“It should be noted, however, that the bulk of the job growth in Leisure and Hospitality will be due to companies reclaiming many of the jobs lost during the pandemic’s earlier months,” the report said.

According to the report, the Financial Activities industry is considered the “fastest-growing economic sector” through 2023. Florida TaxWatch credits the projected growth to the sector’s ability to work from home.

While the job growth prospects may appear promising, Florida TaxWatch warned that some of the benefits wouldn’t readily translate to the consumer market.

“The predicted decrease can be explained partly due to falling stimulus and unemployment payments for many families, which originally offset some of the recession’s impacts in 2020,” the report said.

Meanwhile, Florida’s housing market is expected to remain a “robust” seller’s market in 2021.

The report said declining inventory and high demand would drive “home prices to new highs.”

Florida TaxWatch is a nonpartisan, nonprofit taxpayer research institute.