Oregon Economic Update: Regaining Momentum?
March 21, 2025
Historically Oregon has outpaced the nation in job growth during times of expansion. This changed following the pandemic recession, when the state’s recovery lagged the nation by several months. Then, after a period of comparable performance, growth decelerated in late 2023 and once again Oregon fell below national trends. Between 2023 and 2024 the state grew by 0.3% compared with 1.3% nationally. Contributing factors include slowing population growth, which had a ripple effect across multiple industries; a downturn in manufacturing (including semiconductors) that didn’t happen nationally; and major layoffs in finance and in company headquarters.
The latest quarterly economic forecast from the Office of Economic Analysis (OEA) notes that Oregon has lost momentum but might be showing signs of reacceleration based in part on an uptick in GDP. However, both the state and nation are facing headwinds related to tariffs and federal cutbacks. Oregon is more susceptible to a trade war given our relative dependence on exports. Our three largest exports are computer and electronic products, transportation equipment, and machinery. The three largest export destinations are Mexico, China, and Canada. If trade policy is directed toward Pacific trading partners, and/or is focused on the tech sectors, Oregon risks a disproportionately large impact.
OEA writes that federal budget cuts will also impact the state, particularly in many rural communities where federal employment accounts for a larger share of payrolls (see our recent analysis of federal government employment here).
Despite the uncertainty surrounding policy and its impacts, OEA is still calling for job growth in the near-term. And after underperforming the nation since the pandemic, growth in 2025 should be on par with the U.S. Their baseline scenario calls for Oregon to add 17,000 jobs this year for a growth rate of 0.9%. Underpinning their outlook is a modest rebound in migration which will lead to small population gains.
Meanwhile, the unemployment rate will drift higher but stay in the low 4% range.
OEA's complete report is available at www.oregon.gov/das/OEA/Pages/forecastecorev.aspx.