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Wednesday, June 29, 2011

#4 out of 10 - Ten Cities That Will Take A Decade To Recover From The Recession

Wall Street 24/7 - Charles B. Stockdale - June 22, 2011

.... To be sure, parts of the U.S. are recovering. Experts expect the economy to grow an average of 3% in the second half of this year. Thirty metropolitan areas will have reached their pre-recession peaks by the end of 2011. More than half of the nation’s 363 metropolitan areas are expected to return to their employment peaks by 2014 or before. Others are not so lucky.

The IHS report lists 37 metropolitan areas which are not expected to return to peak employment until after 2021. These areas are facing a “Lost Decade.” Some may never fully recover, although it’s probably useless to try to predict what may happen a decade or more from today....

.... Some cities are forced to address problems beyond manufacturing, yet in the end they face the same results. Atlantic City’s gaming industry has lost its previous strength due to increasing competition from neighboring states such as Pennsylvania which have legalized gaming in recent years. Hickory, North Carolina, was once a major center for furniture production. Many jobs there have since been sent overseas, causing textile mills to close down and workers to be laid-off.

The ten American cities discussed in this article were chosen for the large sizes of their workforces and the fact that they are not expected to have recoveries to their pre-recession employment rates until after 2021. They have lost the industries which once made them prosperous and they will probably never get them back....

4. Hickory-Lenoir-Morganton, NC
- Change in employment 2001-2011: -13.6%
- Population: 365,497
- Unemployment: 11.7%
- Poverty level: 14.4%
- Median income: $40,181

Unemployment in Hickory, NC, soared from 2% to 16% during the recession, according to USA Today. The jobless rate has since decreased to 11.7%, although this is still significantly higher than the national average of 9.1%. The area’s economy is largely based on the production of furniture and fiber optics. Both industries have seen mass layoffs in recent years. According to an article in the Washington Post, “the region has lost more of its jobs to international competition than just about anywhere else in the nation.”


Report says Hickory area jobs may not recover for a decadeWBTV - Steve Ohnesorge - June 27, 2011

- A study prepared for the U.S. Conference of Mayors' annual meeting had a bleak prediction for the unemployment outlook in the Hickory metro area.

It said unemployment levels won't reach pre-recession levels for another decade.

The HIS Global Insight research firm put the hickory metro area near the bottom in the road for recovery nationwide.

"Honestly, it's hard to predict that far out," said Ronnie Grantham, manager of the Employment Security Commission office in Catawba County. "We are actually starting to see some positive things economy-wise around here."...

... As things improve, whenever that is, say officials, they don't expect major growth in the manufacturing sector.

That was the hardest hit by the recession with thousands of jobs lost and people heading back to school to learn new trades.

"Our growth right now has been in the service sector, call centers and things like that," said Grantham.

Some manufacturers are hiring but not in large amounts. Grantham said local economic officials are working to lure new businesses in but admits it is a slow process...

Report: Local employment to recover by 2014 - Charlotte Observer - Kirsten Valle Pittman & Barbara Barrett - June 21, 2011 - Still, the study predicts the Charlotte region's employment rate will recover by mid-2014.

The Charlotte region will return to its pre-recession employment peak by mid-2014, years before beleaguered metros such as Cleveland, Detroit and Las Vegas, a new report found. But the area still faces a slow climb toward recovery, trailing cities from Raleigh to Dallas to Pittsburgh, according to the study from the IHS Global Insight research firm, prepared for the U.S. Conference of Mayors' annual meeting and released Monday....

Some places, such as Austin, Texas, and Burlington, Vt., have already recovered, and others are expected to rebound several quarters before Charlotte. The report said more than half of the country's metro areas will return to their pre-recession employment peaks by the end of 2014. Despite its struggles, Charlotte is performing better than some areas: Stockton, Calif., for instance, posted one of the highest jobless rates in April, 17.3percent.

Forty-eight metro areas, including Detroit, North Carolina's Hickory region and others pummeled by manufacturing and real estate losses, aren't forecast to reach their pre-recession employment peaks this decade, the report found.

The Charlotte area fared better in other measures of economic health, too, the study found. The area's jobless rate has fallen faster than other metro areas over the past year. And the economy continues to grow: The region's economic output totaled $117.3billion in 2010, up 4percent from the year before and 5percent from 2007, before the recession began, the report found. Metro regions' health is a critical component of the broader economic recovery, the report said. U.S. metro areas contributed nearly 90percent of the nation's economic output and jobs last year.


The Hound: What this shows me is that the decision makers in our area who want to maintain the status quo, tweak around the edges, and remain separated from Charlotte and do our own thing are hindering our ability to recover.

I would like to see a Regional Economic Partnership Entity that is focused on attracting business to our area, but we have to do this with an eye on a relationship with the other major metropolitan areas in our region, especially Charlotte. As, I have stated since the inception of this blog, one of the main attractions of our area is the geographical location of the Hickory area in relation to the other Metros up and down the Eastern Seaboard. It isn't about the natural scenic beauty of the area, because we aren't going to build a tourist contraption or retirees moving here to wind it down.  The asset of our location is the fact that it is easy to get to and from our area and we can be a natural hub of transportation for larger metropolitan areas, including Charlotte, Atlanta, Greensboro, Columbia, Raleigh, Knoxville, Nashville, Washington, Pittsburgh, and so on.

We also need to work and adapt towards becoming a cog in the Energy Hub that Charlotte is evolving into with Duke Energy, Piedmont gas, and the innovative partnerships springing up as a result of these new concepts and innovation of energy.

The biggest issue is changing the mindset, energy, and focus of many of the people in this community. There is no energy or excitement. There is no sense of urgency. It is all about cutting back and winding down. You cannot build or maintain an economy like that. We don't have a decade to spare. We can't afford to wind down, especially in the dog-eat-dog economic environment we are in today. I know these are words, but to many of us these words mean something.

The only thing that is constant in life is change and people who attempt to maintain and devote extraordinary energy towards a status quo are wasting energy and time that should be devoted towards adaptation to new realities. What SilenceDoGood has stated in some of his commentary related to this area "having to be dragged kicking and screaming" into new realities is spot on in my opinion. That is what has us behind the 8-ball presently.

We have seen some evolution from business leaders who do understand that there is a need to get moving towards a new economic paradigm for the area, but there are many people in key/vital positions who either don't understand what is going on or they are protecting certain interests or constituencies at the expense of much needed progress. These people want to qualify and lay out parameters for competition in the local area; and in the mean time, while they are arguing over peanuts, National and Global interests have taken a sledgehammer to our economic foundation. What does this show? That our community's leaders weren't asking the proper questions or focusing on what the reality was and is. I don't need to repeat myself. I'll just point to links below of in-depth articles from this blog posted 5 months ago, 17 months ago, 29 months ago, 32 months ago, and the genesis of this blog posted nearly 48 months ago in our local newspaper.If you have never read these, then please do. I do not pretend to be a prophet. I am a thinker and the bottom line is that we need to start thinking about where we are headed, where we want to head, and how we are going to get there.

The State Of Hickory - January 2011  

The State of Hickory - January 2010

(The State of) Hickory, North Carolina 2009

The Objectives of the Hickory Hound

An All-American City deserves first-class leadership


Tom Shea said...

Based on these and other articles not to mention the general perception of the good people who call Catawba County their home, there should be no confusion by both local and state politicians that a consolidated and unified strategy must be established and put into motion immediately. Once initiated it must be tracked for progress and reported to the citizens on a frequent basis through a media channel that is unbiased. We can no longer accept the individual city governments to only look within their own city and ignore what happens in the rest of Catawba County. As Lee Iacocca once said as he was taking over the failing Chrysler Automaker to the local politicians and company management, “You Can Lead, Follow or Get the Hell Out of the Way”. History has shown that he was the catalyst that was required to get the local and state government, unions and management working together in Michigan and turned Chrysler around in record time. Perhaps we can find someone locally who would be willing to follow in the footsteps of Iacocca and lead Catawba County back to prosperity. It is up to the good hard working American citizens that love our country and want to see Catawba County become a great all around location to work and live in to make this happen. We all must become more aware of who is doing what or sadly is NOT DOING anything but working on their next election. Ask tough questions, you have the right to, remember Catawba is your county. Own It, Love It, Support It.

Silence DoGood said...

You know, I just read this latest post and the views of Mr. Shea and I must say, I'm not in the least bit surprised. But I think the 'why' aspect has just been touched on with a searchlight and I had heretofore failed to see it. Bear with me.

Quite a few good ideas, solutions, calls to action, and just plain good discussion have occurred here since I've been stopping by. I can't claim to have contributed to it, since I tend to have the steel bristle brush/turpentine effect on people with some of the things that I conjure up in my little cranium and then haphazardly toss out for bulk perusal. But the notion that I just fixated on is this; know why the powers that are don't acknowledge the ideas or concepts that cross through here, or anywhere else for that matter? They aren't their ideas. They didn't think of them, conceive them, formulate them, so therefore, how valid can they be? It's not theirs, they didn't take root in the roundtable at the country club among old and dear friends of like mind and ideals, so how could anything said here be valid? Do I know that? No, but I know the mentality of the people to whom what is said is addressed. The truth will never come out, but, I'll bet you this. If you could perhaps engage these people in conversation to the extent that what you propose becomes their idea, well, sit back on the bench as the fast track train rolls by!!

Colorful and outlandish but outside of making light, I'm quite serious. You've got a bunch of people sitting around in agreement on a concept and the only opposition you have is from the ones who can get it implemented and coincidentally, didn't contribute to the formulation and conceptualization at onset. The idea has been hung out in a public forum so there is no way to capture it as their own, so that leaves the only course of action; opposition and developing a strategy of 6,238 different reasons it can't and won't work, while completely ignoring that it would, if implemented. Me 2 shillings worth.

harryhipps said...

While I like Tom's thoughts on our situation, I don't see the pressure from the people, or a sense of urgency by our leaders. It seems that folks are content to just go with the flow and whatever happens happens. The years of Mayor Wright's "leadership" have been the worst in Hickory's history and he is the very picture of a glad handing, caricature of a mayor.
Instead of a high intensity effort to attract business, we have stupid side shows like the contrived flap over, God forbid, beer being served at Hickory Alive for the past 25 years. These side shows are just boob bait for the bubbas while we remain at the bottom in almost all rankings. Where is the sense of urgency?