Economic and Workforce Indicators

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Economic and Workforce Indicators

• June 2009

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U.S. Economic Overview

• The recession appears to be reaching its zenith
  in the second quarter of 2009. Economic
  indicators are beginning to bottom out.
• The Great Recession is expected to end over the
  summer and a slow recovery will begin.
• The U.S. has lost nearly three million jobs in
  2009, on top of 3.1 million in 2008. The U.S.
  lost jobs in every month of 2008.
• Unemployment stands at 9.4 in May a 25-year
  high. The rate will top 10 in 2009 and continue
  to rise even after the recovery begins.
• Factoring in other measures of unemployment and
  underemployment, the US rate jumps to 16.4.
• Arizona has been hard hit, entering recession
  before the U.S. and likely exiting after.

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Arizona Economy Update

• Since 2007 Arizona has lost 234,000 jobs, or 8.6
  of employment. A further 5.0 decline is
  projected for 2009, and 2.3 in 2010.
• Employment growth in unlikely before 2011, and
  2007 employment levels will not be recovered
  until 2013 a six-year correction.
• Per capita personal income was up only 0.4 in
  2008, ranking Arizona 50th among states.
• Greater Phoenix had the fifth largest
  year-over-year employment loss among large metros
  in April, behind Los Angeles, New York City,
  Chicago, and Detroit.
• In 2006 Arizona ranked second in job growth among
  states. In 2008 it ranked 47th.

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Employment Growth in Greater Phoenix 2006
Present
Percent Change, Year Ago
Recession Begins
Greater Phoenix U.S.
2007
2008
2009
2006
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Employment in Greater Phoenix April to April
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Arizona Industry Sectors

• Manufacturing employment statewide down 4.8
  (April to April).
• Intel, Honeywell, Banner Health, ON Semiconductor
  are some of the larger employers who will be
  downsizing over the next several months.
• Positive Growth in Federal Government (8.6),
  Local Government Education (3.0), Aerospace
  (2.9), Nursing and Residential Care (2.0),
  Hospitals (1.9), Local Government (0.4), and
  Insurance, Funds, and Trusts (0.3) thats it!
• Negative Growth statewide Specialty Trade
  Contractors (-30.0), Construction of Buildings
  (-26.6), Furniture Stores (-23.3), Employment
  Services (-22.1), and Clothing Stores (-16.8).

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Economic Indicators

• Nationwide, first time unemployment claims in May
  are up 71 over May of 2008, and have approached
  levels not seen in over 25 years. In Arizona
  first time clams are up 61.6.
• U.S. retail sales were down 9.6 between May 2008
  and May 2009. In Arizona sales are off over 10
  and auto sales are down over 40. Taxable sales
  collections are down 17.4 April to April.
• Housing troubles affecting American consumers
  means fewer sales of durable goods to fill the
  homes and less access to credit and declining
  sales tax revenue
• Sun Belt states where housing markets have been
  hit the hardest include Arizona, California,
  Florida and Nevada
• State population growth projected to be in the
  1.3-1.4 range in 2008 and 2009, down from
  3.6 in 2005 and 2006.

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Housing Market

• Median price of an existing single family home in
  Greater Phoenix is down 41.9 from Q1 2008 to Q1
  2009. We led the nation in home price declines in
  March, down 36.0.
• About two-thirds of home sales in Maricopa County
  are bank owned or distressed properties.
• Residential homebuilding has all but ceased in
  the State of Arizona, down 91 from peak.
• Conservatively, there is a surplus of 40,000 to
  50,000 housing units in Greater Phoenix above
  normal demographic demand
• The commercial real estate market is now showing
  signs of distress. Vacancy rates are rising.

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Bright Spots

• The Feds have been proactive Stimulus (787B),
  home mortgage modification (275B), TALF (up to
  1T), Public-Private Investment Program
  (75-100B).
• Inflation is under control. Energy prices are
  down. Deflation might now be a concern.
• Stock Market is up 35 since March.
• Mortgage rates are at historic lows, housing
  affordability is high.
• Consumer confidence is improving.
• Employment growth in Arizona will return by 2010,
  but will not reach 2007 levels until 2013.
• Long term growth prospects for Arizona remain
  strong. State population expected to be 15
  million by 2040. Employment will double as 3.7
  million new jobs are added.

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Bright Spots Stimulus Package

• Workforce Investment Act
• 750 million available nationwide for worker
  training and placement in high growth and
  emerging industry sectors
• Funds for unemployment insurance modernization
  being considered by the State of Arizona
• National Science Foundation - 100 million
  available nationwide for STEM education at all
  levels, with 25 million dedicated for math and
  science partnerships
• Additional areas with potential for job training
  include Health Care, Teacher Technology Training,
  and Head Start

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• Questions?
• www.maricopa.edu/workforce

The Maricopa County Community College District is
an EEO/AA institution.