The Charlotte region will return to its pre-recession employment peak by mid-2014, years before beleaguered metros such as Cleveland, Detroit and Las Vegas, the Charlotte Observer reports.
But the area still faces a slow climb toward recovery, trailing cities from Raleigh to Dallas to Pittsburgh, according to the study from the IHS Global Insight research firm, prepared for the U.S. Conference of Mayors’ annual meeting.
Mayor Anthony Foxx, who joined President Barack Obama, Vice President Joe Biden and a dozen mayors at the White House to discuss the economy, acknowledged the hurdles but said he’s bullish about the Charlotte region.
“I would take the challenges we have in Charlotte over any city in the country,” he said in an interview after the meeting. “The combined willpower we have to surmount our obstacles really makes us special.”
The analysis of the nation’s 363 metro areas found the economic recovery will continue this year, fueling job and wage growth.
But natural disasters, rising commodity costs and the still-struggling U.S. housing market mean the recovery will progress more slowly than after past recessions, the report said.
The study projects a pickup in the second half of the year, with the U.S. unemployment rate falling to about 8.6 percent by the end of 2011 from its current 9.1percent. But the national jobless rate won’t fall below 8percent until 2013, and employment in the U.S. won’t return to its peak until early 2014, the report said.
Wells Fargo & Co. economist Mark Vitner said he wouldn’t be surprised if Charlotte’s job market rebounds on pace with – or slightly before – the rest of the country, given its population growth and signs of a revival in the manufacturing sector.
But that rebound, both for Charlotte and the rest of the country, might take a year or so longer than the mayors conference report predicts, he said. “I think their forecast, overall, is a little aggressive,” Vitner said.
The foundering residential construction field, for one thing, continues to stifle job growth. And U.S. companies are turning out as many goods and services as they did before the recession with 7million fewer workers, Vitner said.
“I don’t see a lot of businesses that are just chomping at the bit to hire those folks back,” he said. “We are going to need to find some new drivers of job growth.”
Standing in a White House driveway with other big-city mayors, Foxx said the challenges facing the region include a “fear element” among large companies and wealthy investors, who still seem reluctant to spend money. He said he wants to see more government-private sector partnerships, such as community colleges working with private companies, and he wants to see more workforce development in both white-collar and blue-collar jobs.
Still, there are positive signs: In the first quarter, 268 companies said they were opening or expanding in Mecklenburg County, planning more than 2,300 jobs, Foxx said.
Recent government data show about 45,000 fewer people are employed in the Charlotte-Gastonia-Rock Hill metro area now than in December 2007, when the recession began. The area’s unemployment rate surged to nearly 13 percent before falling to 10.3percent in April, still more than double the sub-5percent rates seen before the recession.
The mayors conference report expects that rate to fall to 10.1percent by the end of 2011. It will continue to fall steadily, though by the end of 2013, it’s still forecast to be 8.7percent.
The report predicts a return to Charlotte’s pre-recession employment peak – about 820,000 workers in early 2008 – by the second quarter of 2014, though the region’s unemployment rate will still be about 8percent then, according to IHS Global Insight. That forecast ranks Charlotte somewhere in the middle of the nation’s metro areas.
Some places, such as Austin, Texas, and Burlington, Vt., have already recovered, and others are expected to rebound several quarters before Charlotte. The report said more than half of the country’s metro areas will return to their pre-recession employment peaks by the end of 2014.
Despite its struggles, Charlotte is performing better than some areas: Stockton, Calif., for instance, posted one of the highest jobless rates in April, 17.3 percent.
Forty-eight metro areas, including Detroit, North Carolina’s Hickory region and others pummeled by manufacturing and real estate losses, aren’t forecast to reach their pre-recession employment peaks this decade, the report found.
The Charlotte area fared better in other measures of economic health, too, the study found. The area’s jobless rate has fallen faster than other metro areas over the past year. And the economy continues to grow: The region’s economic output totaled $117.3billion in 2010, up 4 percent from the year before and 5percent from 2007, before the recession began, the report found.
Metro regions’ health is a critical component of the broader economic recovery, the report said. U.S. metro areas contributed nearly 90percent of the nation’s economic output and jobs last year. “Close attention needs to be paid to the economic health of our nation’s metro areas and the health of the nation as a whole,” the report said. Read More.