Prognosticator Alan Beaulieu of ITR Economics was in Bend on Thursday to tell a rapt audience when to expect the next downturn.

Based on his New Hampshire firm’s proprietary leading indicator, he thinks the next recession will hit late this year and last into the first half of 2019. He thinks it will be so mild that business owners should think of it as a softening.

“It’s going to be an off year,” he said. That’s an opportunity to reinvest in a business by retooling or training the workforce, he said.

“If you don’t have strategic plans for investing in your business in the next 18 months, you need to go back to the office and start working on it,” he said.

Beaulieu spoke to about 750 people gathered at the Riverhouse on the Deschutes for Economic Development for Central Oregon’s annual luncheon. Recapping the year, EDCO CEO Roger Lee said the region had high levels of economic growth, capital investment and business formation across industries. Bend led the state in the rate of business formation with one new business for every 28 residents and a total of 3,200.

Beaulieu was last in town in 2015, just after the release of his book, “Prosperity in the Age of Decline.” The book warns of the next Great Depression, which Beaulieu believes will hit in 2030, when rising health care costs and a growing national debt come to a head.

Beaulieu hasn’t backed off the prediction, he said, because health care spending continues to grow, and that burden won’t go away until the youngest baby boomers have died off.

“Our culture says, ‘Keep me alive,’” said Beaulieu, 61. “How on Earth are you millennials and Gen Xers going to afford us? You can’t.”

He doesn’t think the health care company being formed by Amazon, Berkshire Hathaway and JPMorgan Chase & Co. in order to reduce costs will make a dent. “They can’t get away from the fact that as we get older, the claims get larger and larger.”

Nor has ITR changed its outlook because of the new tax code, Beaulieu said. Real growth in gross domestic product has never correlated with a rise — or drop — in the top marginal tax rate, he said. But the national debt will continue to grow, he said.

“All the millennials in the room,” he said, “you should plan on working longer and paying more taxes.”

Despite predicting the next Great Recession, Beaulieu is bullish on the United States as the land of opportunity, mainly because of energy production and exports. Contrary to widespread belief, he said, U.S. manufacturing activity is strong, although more work may be performed by robots.

Bend boutique owner Jennifer Riker said she was most interested in Beaulieu’s prediction of the next Great Depression and how she can prepare her children, who are 11 and 14. In the meantime, she’s on the aggressive track that Beaulieu advises. He urged business owners to take advantage of low interest rates and borrow so much money, bankers lose sleep at night.

Riker opened a second location for her store, Brave Collective, in Lake Oswego in December, and she said a second Portland-area store will open in mid-March. Riker said she’s a natural risk-taker, and as a retailer, the prospect of the next downturn doesn’t scare her because she endures slow months every year.

“I do this every January and February,” she said.

—Reporter: 541-617-7860, kmclaughlin@bendbulletin.com