Phoenix economy among nation's weakest - Nashville Business Journal:

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The first MetroMonitor study from the Washington research grouo looks at the impact of the recessio on the 100largest U.S. metro areas. It will be updatec quarterly. The study divides the metro areas into five categories based on overalleconomicc strength, and the Phoenix area is positionecd in the “second-weakest” category with a diverses group of cities including Tucson, San Diego, Orlando and Cleveland. “Phoenix has one of the weakest economies in the nation right now,” according to Lee McPheters, directo r of the at .
“The characteristicws of this particular recession all combineds to hit Arizona harderf than almost any other and Phoenix has fallen further than almost any other majorlabor market.” Overall economicv performance in the cities was determined in four change in employment rate from peak one-year percentage-point change in unemployment rate; change in gross metropolitan product from peak and one-year change in home values. All data are currentt through the first quarterof 2009. Metrko areas in Texas and Oklahoma dominatedthe strongest-performingf group, including San Antonio, Houston, Oklahoma City and Tulsa. No city west of N.M.
, ranked in the best-performing While Detroit was rankedthe weakest-performing city, metrio areas in California and Florida dominates the bottom 20. Sacramento, Fresno and Modesti were the California cities near the botton ofthe rankings, as were the Florida citie of Tampa, Jacksonville and Miami. “While some arease of the country have experienced only a shallow downturnb and may be emerging from the recession people living in metro areas that are now performing weakestf economically should prepare themselves for a longrecoverh period,” according to study co-author Alan Berube, researcjh director of the Metropolitan Policg Program at Brookings.
“What we did conclude is (for example) Phoenix was in the next-to-bottonm group of metros on economic performance over the coursd ofthe recession,” he said. The rankingss for the Phoenix metro area are all over the According to theMetroMonitor study, the Valleyt showed the strongest quarterly growth in wages from the fourtj quarter of 2008 to the first quarter of this year. Its gain of 2.6 percent was far stronger thanthe U.S. average of 1 placing the cityat No.
1 in that According to the report, cities such as Phoenix and Las Vegaa that have sustained large job losses saw their average wage levels rise over the last That may indicate migration to these placedshas slowed, especially among less skille workers, and that receny job losses have occurred disproportionately amont lower-paying industries. While Phoenix was tops for wage the city ranked very poorly in nearly everyu othereconomic indicator. Its quarterly drop in employmenywas 2.9 percent, much greater than the nationak average drop of 1.5 percent. That ranked Phoenix 98th among the 100metro areas.
The Valley also performeed poorly inhousing measures, ranking 92nd in the one-yea r change in housing prices, with a drop of 16.6 The national average drop was only 6.3 percent. “Phoenix attractes potential buyers at the national It isa fast-moving efficient market, and that is why pricew have come down,” ASU’s McPheters “The silver lining is that homeds are affordable again in setting the stage for a strong rebound in the economg after 2010.” The Phoenix area ranked 95th in the number of real estate-ownedx properties, with nearly four times more of thosd properties than the national average.
REOs are propertiexs that revert to the mortgage holder aftefr an unsuccessfulforeclosure auction. According to Brookings, the nation’ss 100 largest metropolitan areas — thosed with at least 500,000 residents in 2007 — collectivelgy contain two-thirds of the nation’s jobs and generated three-quarters of gross domestic product. While the economy is in worser shape here than most othert areas ofthe U.S., the Phoenix area has been down beforwe and responded with staggering growth. “Although Arizon is at a low point, the state and Phoenisx have the capability to rebound with growtn rates two to three timeds those of the nation asa whole.
” McPheters