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Recession Hangover Lingers in ABQ

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Albuquerque remains among the slowest of the nation’s largest 100 metropolitan areas to fully recover from the Great Recession, but its performance has improved slightly, a new Brookings Institution study has found.

As of the second quarter, which ended June 30, Brookings ranked Albuquerque 90th slowest in returning to pre-recession levels of economic activity. The area was ranked 94th as of the first quarter of 2012.

The national recession began in December 2007 and was over in June 2009. However, New Mexico’s economy remained fairly strong until late 2009. Employment declines became serious in 2010.

Brookings compared the most recent levels of employment, economic output, housing prices and unemployment rates against their peak levels and against their lowest levels since 2004. Data for Albuquerque show:

♦ Second quarter employment is 0.6 percent above 2004 levels. Employment peaked in the second quarter of 2008 at almost 8 percent above 2004 levels.

♦ The second quarter unemployment rate was 7 percent. The unemployment rate was 3.3 percent in the second quarter of 2007, its lowest level since 2004.

♦ Albuquerque’s total economic output, or gross metropolitan product, is much improved since the national and statewide recessions began. Today it is more than 11 percent above 2004 levels.

♦ Home prices are at about 74 percent of their peak levels, reached in the first quarter of 2007.

In the past four quarters, employment in mining (which includes oil and natural gas extraction) grew 7.4 percent, health services employment has grown 4.9 percent, education 4.2 percent and manufacturing 3.8 percent, according to Brookings.

Construction employment was down 6.4 percent in the four-quarter period, finance and insurance employment was down 3.5 percent, government employment was down 3 percent and professional and business services employment was down 2.3 percent.

Brookings found that nationally “both employment and output growth decelerated across most of the nation’s 100 largest metro areas, after relatively fast growth during the first quarter.” Unemployment rates fell in more than half of all metropolitan areas, but remained above 6 percent in all but a dozen.

The New Orleans area showed the biggest rebound from its low point among the nation’s 100 largest metropolitan areas, followed by Houston and Phoenix.

Little Rock, Ark., is the slowest area to rebound, followed by Harrisburg, Pa., and the Norfolk, Va., areas.

Brookings said economic recovery was generally strong in Texas and Oklahoma metropolitan areas because the recession never hit them that hard in the first place and because they have benefited from the oil boom. Also enjoying stronger recoveries are some high-tech areas, like Austin, Boston, Portland, San Jose and Seattle; cities where housing prices have begun to stabilize, like Boise, Phoenix, Provo and Salt Lake City; and some manufacturing centers like Detroit, Grand Rapids, Mich., and Toledo and Youngstown in Ohio.

State capital areas, because of slowing government spending, have been slowest to recover, Brookings said. Among these are Honolulu, Little Rock, Albany and Harrisburg.
— This article appeared on page A1 of the Albuquerque Journal

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