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Oregon’s Economic Forecast Shows Resilience With Recession Risk Now Diminishing Top Stories By Lucille McNamara On Nov 20, 2025 Last updated Nov 27, 2025 FILE - Oregon State Capitol - October 2024 - Salem, Oregon | Photo by Seth Smigelski The fourth quarter economic outlook for Oregon shows continued resilience. However, the risk of recession is diminishing, with a modest improvement in 2026 forecast by the Office of Economic Analysis (OEA). The Forecast Helps the State Government Budgeting Process The quarterly revenue forecasts are open to public scrutiny and form the basis for the bulk of the Oregon state government’s budgeting process. Forecast Item (2025–27 Biennium) Change / Value General Fund Outlook Revision + US$ 309.5 million Corporate Income Tax impact + US$ 266.9 million Personal Income Tax impact + US$ 48.0 million Projected ending balance (June 30, 2027) - US$ 63.1 million deficit Previous projected deficit (prior forecast) - US$ 372.7 million Economists Carl Riccadonna and Michael Kennedy examined all sources of revenue contributing to the General Fund (personal and corporate income tax), the lottery, and the Corporate Activity Tax. The Forecast Was Complicated by a Lack of Statistics because of the Federal Government Shutdown The economists say the fourth-quarter forecast was complicated by a lack of economic statistics resulting from the federal government shutdown. However, economic resilience at the national and state levels is expected to continue. The revenue forecast for 2025-27 shows a predicted increase of $309.5 million, largely due to a recent upturn in Corporate Income Tax receipts. Economists note that this revenue stream is particularly challenging to forecast due to its significant quarter-to-quarter volatility. A mild improvement in the economy is forecast for all other revenue streams. The projected General Fund end-balance has improved, reducing a $372.7 million deficit to $63.1 million from last quarter. 2025–27 Oregon Budget Forecast at a Glance Recent revisions by the Oregon Office of Economic Analysis reflect stronger-than-expected revenues, narrowing the state’s projected deficit. + US$ 309.5M General Fund outlook improved + US$ 266.9M Corporate Income Tax bump + US$ 48.0M Personal Income Tax adjustment – US$ 63.1M Projected 2027 deficit (largest gap narrowed) Source: December 2025 forecast by Oregon Office of Economic Analysis. Dailytidings.com The Office of Economic Analysis operates within the Department of Administrative Services to provide objective forecasts of the state’s economy, revenue, population, corrections population, and Youth Authority population. The forecasts are used across the state government and by the public to inform the state budgeting process. Share Twitter Facebook ReddIt WhatsApp Pinterest Email