"The West Michigan recession is over."
It's interesting that no one locally has uttered these six words; not George Erickcek of the W.E. Upjohn Institute, not PNC Bank in their Southwest Michigan economic report, not other media outlets, not even the economic development group The Right Place. What gives?
An economic panel back in 2010
declared the 18 month long U.S. recession officially "over"
, even though the national unemployment rate back then was still hovering around 10%
. That was three years ago. Three. The Grand Rapids' area's unemployment rate has been hovering around 6.5% over the last year, almost a full point below the national average, and yet the response is "ho hum, recession is still not over," locally.
Household income is up, nearly 10% in the last year alone. We're almost caught up to the national average in household income. But apparently that's not good enough for local pundits.
Home sales in the Grand Rapids area are at a record high. Homes (listings) on the local real estate market are at an all time low, at about 2.9 months of inventory (ask your Realtor what that means). We'll give you a hint: homes priced competitively are being snatched up at a breakneck pace. Homebuilders are seeing a pace of construction they haven't seen in about 6 or 7 years. But apparently still not good enough.
Apartments in the Grand Rapids metro area are, according to many sources, going on waiting lists. Downtown developer 616 Development has reported that they have close to 800 people on a waiting list for the 50 or so apartments they have under development. Suburban apartment complexes are reporting similar situations. Still not good enough.
Part of that housing crunch might be due to the fact that the census estimates that Kent County grew by the largest jump in 12 years, adding about 6300 people to the mix. And for the fist time since the census started tracking this a few decades ago, "net domestic migration" was positive last year in Kent County, meaning more people moved here
than moved away. Should we call the recession over? Let's keep going.
"Unemployment rates" are always a bit specious, so we'll throw some raw "employment" data for the local economy at you. Since January 2013, the "Labor Force" (the number of people working and seeking employment) spiked by 23,000 people. It might not seem like a lot (would fill Van Andel Arena twice over) but the entire workforce of the Grand Rapids area is around 400,000. It's about a 5% growth rate. At the same time, the number of people "employed" spiked by 20,000 people. Still not good enough? Yes, we know, all those jobs were in fast food. Right.
To give some perspective, unlike other States, Michigan and West Michigan experienced a "double dip" recession/depression that started back in 2001, shortly after the terrorist attacks of 9/11. That's right, Michigan has been slogging through a decade+ long recession; perhaps you've heard how it has affected Southest Michigan? The local economy is now within striking distance (a few thousand jobs) of regaining all those lost jobs. You heard it, the "lost decade
" of the 2000's, at least locally, has been found. Not convinced?
Just to illustrate the point further, let's take a look at the employment situations of some of our peer cities, particularly Southern cities that have been fighting to take Michigan jobs and residents:
) Knoxville, TN lost about about 30,000 jobs during the 2008/2009 recession. They've regained about 20,000 of those. Still not close to pre-recession employment.
) Richmond, VA lost about 30000 jobs. They're just now getting back to earlier levels.
) Birmingam, AL lost about 71,000 jobs. They've regained about 40,000 and are still about 30,000 short of being back to "normal."
) Little Rock, AR lost about 21,000 jobs. They're only about half way back.
) Greensboro, NC lost about 35,000 jobs. They're back up but only to 338,000, quite a bit short of their pre-recession 358,000.
) Greenville, SC, a city that tried to position itself as the new "automotive capital of the South" with a new BMW plant and R&D facility. They're still down 6000 from their peak.
) Las Vegas lost 56,000 and is nowhere near gaining those back. Providence, RI lost about 71,000 and has come back to about half that. Rochester, NY lost 43,000 and has barely regained half.
) Even Chicagoland, which has a reputation for capturing half of Michigan college grads, lost a whopping 450,000 jobs during the recession. That's right, 450,000 jobs lost
, more than twice the population of the city of Grand Rapids. Sort of mind-boggling how deep the recession was. It's slowly crawling back, but is still in a deficit of 250,000 jobs.
U.S. economists have declared the recession over. The Eurozone has officially declared their recession is "over."
Yet our other local media outlets
in GR reported in early August (which was a reprinted Associated Press story) that unemployment bumped up to 7% from May (which it always does every May - June period because college students and high school students flood the job market). That was their big employment story of the quarter.
And anecdotally speaking, Cedar Point in Sandusky, Ohio built its first roller coaster since 2007, the $30 Million Gatekeeper
, and had its biggest opening weeked in history this year. More than half of Cedar Point's visitors come from Michigan (so I hear).
Back on the local homefront. Are there still people unemployed? Of course. Even in a booming economy there are unemployed. Are incomes lower than they should be? You bet. In fact, we plan to tackle that issue in an upcoming editorial.
Is the local recession over? Yes, by all means, yes. Now get back to work.
Jeff Hill is Publisher at Rapid Growth Media