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Few Cities Have Regained Jobs They Lost, Report Finds
Reprinted with permission from The New York Times

By Michael Cooper
January 18, 2012


Less than a tenth of the nation's metropolitan areas have regained the jobs they lost in the economic downturn, according to a report being released Wednesday by the nation's mayors as they gather in Washington to express their exasperation that the federal government seems more intent on cutting aid to cities than on sending more.

Only 26 of the nation's 363 metropolitan areas had recovered their lost jobs by the end of 2011, and only 26 more are projected to recover them by end of this year, according to the report, which was commissioned by the United States Conference of Mayors. It will take at least five years for the 80 hardest-hit areas to recover the jobs they lost, the report forecast.

Households in metropolitan areas experienced a 2.2 percent decline in median income from 2009 to 2010, it found, while those in rural areas did not see a statistically significant decline. And the report said that housing prices fell by 4 percent in 2011, sapping household wealth and further shrinking the property tax base that many cities rely on.

But the lingering economic crisis has failed to spur any meaningful recent action in Washington, mayors said in interviews.

"We're looking for a partnership with the Congress to put America back to work," Mayor Antonio Villaraigosa of Los Angeles, a Democrat who is the president of the mayors' group, said in an interview. "We're looking for the Congress to do its job. If we were to grade the 112th Congress, I think you-d have to say the midterm report card grade would be very clear: an F for failure."

Not only has Congress failed to overcome partisan gridlock to agree on a way to created much-needed jobs by spending more money on infrastructure, mayors said, but even the small sources of federal support that cities rely on whether the Community Development Block Grants that were devised by Republican administrations in the 1970s or more recent federal programs that help struggling cities pay for more police officers or firefighters are being scaled back as Washington has made cutting the deficit a priority.

The resulting frustration cuts across party lines. Asked how Washington had responded to the slow and uneven recovery, Mayor Scott Smith of Mesa, Ariz., a Republican, answered the question with a question. "What have they done?" he asked.

He said that Mesa depended on its shrinking share of federal block grants to help pay for important local needs, including a shelter that cares for homeless men, some of whom are veterans.

"Whether Congress funds us or doesn't fund us, we still have a homeless vet on the street that has to be cared for; we can't ignore the problem," Mr. Smith said. "I'm a Republican, and I'm not generally in favor of a lot of federal spending, but I believe that if there's a homeless vet on the street that the federal government shares some of that responsibility and some of that burden. Simply because they reduce the budget doesn't mean the cost goes away."

The report commissioned by the mayors, which was prepared by IHS Global Insight, said that even as the recovery continued to take hold there was an "uncomfortably high" 30 percent chance that the United States could slide back into recession.

And it said that two of the biggest risks were very much out of the hands of cities: the crisis in Europe and federal budget policy. This year, the report estimated, federal, state and local spending will decline by 2.5 percent, which would lower the nation's gross domestic product by half a percentage point.

Some mayors have known only fiscal crisis.

"I've been mayor for three years now, and all I've known is an environment of cuts and significant deficits," said Mayor Ashley Swearengin of Fresno, Calif., a Republican. Fresno has cut about 800 jobs through layoffs and attrition, and the area's unemployment rate remained at 15.7 percent in November.

Though they fear that there will be little action in a presidential election year, mayors said that they hoped Congress could at least be persuaded to pass a long-term transportation bill at last something that has traditionally enjoyed bipartisan support but that has been a flashpoint in recent years. At a minimum, they said, they hope Congress will avoid more painful cuts.

Mayor James Brainard of Carmel, Ind., a Republican, said that the country must get to a point where it spends less than it collects in revenues, but that it must be done over years, carefully.

"We have to recognize that it can't be done in one year without throwing us into a huge, much worse depression than We've had," he said. "It needs to be a multiyear plan that doesn't create terrible hardship."