Denver
June 5-10, 2003

NEW REPORT FINDS U.S. METRO AREAS LOST ONE MILLION JOBS IN 2001-02; PREDICTS LITTLE JOB GROWTH IN 2003

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Report

Fact Sheet
DENVER, June 7, 2003 – A new report by the U.S. Conference of Mayors and the Conference’s Council for Investment in the New American City finds that U.S. metropolitan areas, the engines that drive the national economy, lost more than one million jobs in 2001 and 2002, three times the job loss reported in preliminary government estimates in January.

In the nation’s 20 largest metropolitan areas, the report predicts overall employment growth this year at a scant 0.1% – with nine of the metro areas experiencing either no job growth or continued employment contraction. This represents a significant downward revision from the January report, which predicted a 0.9% job growth rate this year.

“The unemployment rate will creep up in the middle of the year before coming back down to present rates,” finds the report, which was produced by Global Insight, a economic consulting firm. The unemployment rate is unlikely to decline until jobs grow at an annual rate of one percent, predicted to occur this year in only two of the nation’s 20 largest metro areas, Phoenix-Mesa (1.6%) and San Diego (1.0%). A sector-by-sector analysis forecasts significant 2003 job losses in manufacturing (-2.9%), transportation-communications-utilities (-1.4%), and construction-mining (-0.6%).

The report assumes a strong pickup in national economic growth during the second half of 2003, due in part to fiscal stimulus from the recent tax package. If a strong second-half recovery does not materialize (35% probability), then the top 20 metro areas may actually lose jobs overall.

“The weak national economy has hit U.S. metro areas hard,” said Boston Mayor Thomas Menino, President of the U.S. Conference of Mayors. “We don’t see any help for cities coming down the road. The recent tax package provided assistance to states, which mayors support, but left out any help for the nation’s cities, which drive our national economy. We need strategic investments now in housing, transportation, homeland security, and job training to spur economic growth and put people back to work again.”

According to the report, the nation’s 20 top metro areas will generate $4 trillion in output in 2003, or 36% of the national economy. Metro areas generate more than 80% of the nation’s employment, income, and production of goods and services. “They drive U.S. growth during good times, but their continued weakness has stalled the nation’s recovery since early 2002,” finds the report.

“Until metro areas, the locomotive of the U.S. economy, revives, the national economy will continue to stall,” said Detroit Mayor Kwame Kilpatrick, who chairs the Conference’s Council for Investment in the New American City, a coalition of mayors, business people, and non-profit organizations that promotes a new urban renaissance in America’s cities. “Mayors know that as cities go, so goes our nation.”

The complete report can be downloaded at usmayors.org.

Press contacts:
Andy Solomon (202) 861-6766 or (202) 744-3117
Lina Garcia (202) 861-6719 or (202) 744-2959


©2003 U.S. Conference of Mayors