Tuesday, May 06, 2008

Recession Resistant Cities

Recently, Forbes magazine did its survey of the ten most "recession proof" cities. I didn't like the term "proof" and softened it with "resistant," because a bad turn in the economy could change everything. I love Forbes and lists like this and was particularly delightful with its choices.

So what are the top ten?

Number 10, Dallas/Fort Worth, Texas. Get used to seeing Texas, it is one of only two states that has more than one city on the list and it enjoys four cities at that. With median home prices up 5 percent, unemployment at a paltry 4.3 percent, and a 5.6 percent increase in jobs in the crucial education and health care areas, DFW is looking pretty.

Number 9, Charlotte, NC. Median home prices are up 3.3 percent, unemployment is a modest 5.4 percent, and there has been an increase of more than 4 percent in the growth of professional, business services, leisure, and hospitality. Obviously a strong city, but some numbers (like unemployment) are going in the wrong direction (up from 4.7 percent since last year). Why wasn't DFW above this?

Number 8, Seattle, WA. The "emerald city" enjoys a median home price up 1.2%, unemployment at 4.3 percent, and employment growth in leisure and hospitality, 4.1%; manufacturing, 2.6%.

Number 7, Houston, TX. I would make it higher on the list, but I am also the poster boy for the city's chamber of commerce. Median home prices are up 1.1 percent, unemployment: 4.2% (acutally less than last year from 4.5%), and key job growth areas that include natural resources, 5.9% and construction, 4.7%.

Number 6, Salt Lake City, UT. Median home prices are up 2.5%, unemployment is a remarkably low 3.1 percent (slightly higher than last year), and key growth areas of education and health services (both up 5.5%).

Number 5, Raleigh, NC. Median home price is up 4%, Unemployment is a low 4.2% (from 3.7%), and their key growth includes rofessional and business Services, +7.4%; education and health, +6%.

Number 4, San Jose, CA. This one made me scratch my heads! Most of California is being taxed and regulated into oblivion, so this is a healthy exception. How healthy? Median home prices are still going up, way up to 11.2%, unemployment is a healthy 5.2% (from 4.7%). and it's
key growth area is in Information is up 4.5%.

Number 3, Austin, TX. Median home prices are up a vigorous 6.4%, unemployment is an extremely low 3.6% (from 3.8%), and the key growth areas are natural resources and construction, 5.1%; and leisure and hospitality, 5.3%

Number 2, San Antonio, TX. Texas' number one city according to Forbes enjoys a median home price increase of up 7.9%, unemployment at 4% (from 4.3%), and key growth areas include construction, 6.3%; and leisure and hospitality, +4.9%.

When I do articles such as this I feel like a disc jokey, and you can almost hear the drumb roll and wild deep voice with "NUMBER ONE..."

Oklahoma City. This is interesting and maybe even a little disappointing. It is linked almost entirely to energy and includes the following numbers: Unemployment: 3.5% (from 4.7% in February 2007) and key growth areas in leisure and hospitality, +6%; construction +11.5% from 2007.

Interesting choices, all largely accurate in my opinion (although I could disagree here and there). All of them are in the West and South and they are also among the fastest growing areas in population in the country. I can speak from personal experience that Houston can absorb more people.

Most of the cities rest comfortably in states with very pro-growth economic policies. They tend to be Right-to-Work, less regulatory, pro growth tax focus, etc. San Jose is about the only one on the list that doesn't have such an approach. How can other states become "recession resistant?" By implementing similar policies as most of the states on this list.
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Kevin Price is Host of the Houston Business Show (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at HoustonBusinessShow.com. Visit the archive of past shows here.

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Anonymous Mark Hall said...

I like it. Good stuff. I would like to see you elaborate on the role government is playing.

12:16 PM  
Anonymous Anita Alter said...

Texas is great and I am glad that you showcase it in your blog.

9:51 AM  

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