February 2, 2009

Mayors Release Report Warning of Worsening Job Losses

Many Metros Will See No Job Growth for Entire Decade

By Dave Gatton

The nation's mayors at the 2009 Winter Meeting in Washington (DC) January 17 released a major economic report forecasting that the nation's jobs picture would worsen during the year. They called on Congress to move quickly on President Barack Obama's Economic Recovery Plan to immediately create jobs and make investments in the future economy.

"The economy is getting worse, more job losses are on the horizon, and small businesses are folding, or holding on by the skin of their teeth," said U.S. Conference of Mayors President Miami Mayor Manny Diaz. "We need action now on a recovery plan to put people back to work."

The report-U.S. Metro Economies: Metro Unemployment Forecast-projects all but five of the nation's 363 metro areas will lose jobs in 2009, and just one will add more than 200 jobs on net.

Unemployment will rise above ten percent in 70 metros; 105 metros will see jobless rates above nine percent; and 297 out of the 363 metros will see their unemployment rate rise by more than one percentage point.

In 2009, the New York City Metro will suffer the largest drop in actual jobs, losing 181,000 (down 2.1 percent); followed by Los Angeles with 164,000 lost jobs (down 3.0 percent); and Miami, with a job loss of 85,000 (down 3.6 percent). 171 metros will see job declines in excess of two percent through 2009. An additional 141 will see losses in excess of one percent employment.

Even more striking is the number of metros that have not seen any job growth over the decade. By January 2008 there were 66 metros registering negative job growth for the entire decade (beginning 2000). By November 2008, that number had grown to 93 metros, (about 25 percent). By the end of 2009, the report projects that 129 metros, one-third of all metro areas, will have experienced no overall job growth for the decade. For these metros, this decade will be known as the "jobless decade."

In addition, another 131 metros had job gains that have not kept pace with the increase in the U.S. workforce.

In all, the report forecasts that unemployment rates will rise above eight percent in metro areas in 2009, and nine percent in 2009.

"Our cities and their metro areas are the drivers of our national economy," said Dallas Mayor Thomas Leppert. "A national economic recovery depends on how soon our metro economies can begin producing jobs," he said.

The report projects that 94 percent of U.S. economic growth over the next 20 years will occur in metro areas and that without the economic recovery of metro economies, there can be no U.S. recovery.

The report concludes "The national Recovery and Reinvestment Plan can best achieve its goal of jump-starting the economy and setting the stage for strong future economic expansion by explicitly targeting metro areas." "That is where there is pain now, where there are productive resources ready to be put to use, and where public investment can have the greatest band for the buck."

The report was prepared by IHS Global Insight.