| June 27
June 27 In a twist on the old aphorism about
real estate, the three most important factors for the current
U.S. economic recovery seem to be location, location, location.
Growth right now is "extremely concentrated" in a few
states, said Chris Mauro head of U.S. Municipal Research
Strategy at RBC Capital Markets, adding that there has been "a
general stagnation, with the exception of some of the
Three reports released on Wednesday show wide variations in
the rebound from the 2007-09 economic recession, both at the
state and local levels.
Unlike past downturns, the recession spared only a few
states, largely because it hit nearly every economic sector and
the states' economies are interconnected, said Arturo Perez at
the National Conference of State Legislatures.
"When things started going south, no state was able to ward
off the bad stuff that was happening," he said.
But the states did not enter recession at the same time and
some suffered less than others.
"They're not in lockstep going into a recession. They're not
going to be in lockstep coming out," he said, pointing to
Kansas, which did not have the same run-up in housing prices -
and therefore not as steep a drop - as Nevada.
Now, energy-rich states are sprinting toward prosperity,
helped by a surge in natural gas, while others are closer to
shuffling back to stability. That is creating disparities on the
personal level and the political one - some states are
considering cutting taxes while others are having to close
In the first quarter of 2012, personal income rose in 47 of
the 50 states, according to a Commerce Department report
released on Wednesday that found state personal income growth
was 0.8 percent in the first quarter, compared with 0.4 percent
in the fourth quarter of 2011.
Personal income declined 0.3 percent in Mississippi and 0.1
percent in Kansas and was unchanged in Oklahoma in the first
three months of 2012. On the other end of the spectrum, income
grew the most in commodity-abundant North Dakota, 2.3 percent
from the quarter before.
Total earnings grew 0.81 percent in the first quarter,
according to the report. They ranged from dropping 0.34 percent
in Oklahoma to rising 1.12 percent in Washington.
Earlier this month, the US. Census reported that economic
growth was scattered across the states in 2011. A boom in mining
helped North Dakota's economy grow 7.6 percent, while in six
states the economies shrank.
PATCHINESS AT LOCAL LEVEL
Cities and counties also did not enter recession in a
uniform way. Some were immediately affected by the housing
crisis, while others did not see the downturn until there were
massive problems on the national level, said Jackie Byers, a
researcher at the National Association of Counties.
In its quarterly review of metropolitan economies released
on Wednesday, the Brookings Institution described the wide
variations in recovery as "significant patchiness."
Brookings found that from January to March, employment
growth accelerated across most of the nation's 100 largest metro
areas, while output growth weakened. Unemployment rates fell in
more than half of all metropolitan areas, but remained above 6
percent in almost all of them.
Housing prices hit new lows in 73 of the 100 largest
metropolitan areas, which typically include a major city and its
surrounding suburbs, after showing signs of growth in previous
quarters, Brookings found.
"Until there's a recovery across all sectors you won't see a
smoothing out in the economy," said Alec Friedhoff, a research
analyst for the group's Metropolitan Policy Program.
Brookings found that, yet again, cities in Texas are having
the fastest recoveries, largely because they experienced mild
recessions and are now benefiting from a boom in natural gas.
Cities in California's Central Valley, such as financially
tottering Stockton and other western metropolitan areas such as
Colorado Springs, Las Vegas and Tucson continue to lag.
U.S. Labor Department data also released on Wednesday showed
the patchiness likely persisted past March.
In May, employment increased in 266 metropolitan areas from
a year before, decreased in 101 areas and had no change in five
areas. The jobless rate was at least 10 percent in 45 areas, but
was lower than 7 percent in 140.