Download April 2012 - Maricopa Community Colleges

PVCC Strategic Planning Steering Committee
Economic and Workforce
Overview
John Catapano, Research and Communications Coordinator
Center for Workforce Development
April 27th, 2012
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U.S. Economic Overview
Hopefully, 2012 is the Year Everyone Actually
Believes that we are in a Recovery
(after three years!)
No More Fears of a “Double Dip” Recession
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Growth in Real GDP
2007 Q1 to 2011 Q4 (annualized)
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Fears of a “Double Dip” Recession
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Stock market volatility
European debt crisis
Depressed housing market
Banks reluctant to lend
Impact of healthcare reform
Impact of Dodd-Frank
2012 elections
Debt ceiling debate
Concern about the deficit/debt
End of federal stimulus
• Less government spending
• High oil and commodity prices
• Turmoil in the Middle East
• Japanese earthquake and
tsunami
• Extension of Bush tax cuts
• Concerns over future taxes and
regulations
• Political polarization
• Downgrade of U.S. debt
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U.S. Private Sector Employment Growth
January 2008 to Present (month over month, in thousands)
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Percent Job Losses in Post WWII Recessions
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U.S. Unemployment Rate
January 2000 to Present
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Job Losses and Gains Since Dec-07 Peak
(in thousands)
Recession
Recovery
Trade, Trans, Util,
Construction &
Other Serv
Mining
Prof & Bus Serv,
Manufacturing
Financial
Information
Activities
Leisure &
Hospitality
Education &
Health Serv
Government
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The Skills Gap
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Technology is Changing the Nature of Work
Disaggregation of Jobs
Geographic Mismatches Between Jobs and Workers
Growing Pools of Untapped Talent
Disparity in Income Growth
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Income Inequality
Driven by:
• Demographic Changes
• Immigration
• Technology
• Government Policy
• The Decline of Organized Labor
• Excessive Executive Compensation
• Education
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U.S. Outlook and Summary
Upside:
• Good job numbers
• Companies remain highly profitable
• Banks are loosening purse strings
• Consumers are paying off debt
• Manufacturing is doing well, exports are up
Downside:
• Housing market is still a mess
• Government austerity will hurt
• Skills gap and income inequality
• Higher energy prices
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Arizona Economic Overview
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Employment Growth, AZ v. U.S.
January 2006 to Present (percent change, year ago)
Arizona
U.S.
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AZ Unemployment Rate
January 2000 to Present
Arizona
U.S.
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Arizona Industries
Employment Today Compared to a Year Ago (March to March)
Job Added in
the Last Year
Peak-to-Trough
Employment Loss
Leisure and Hospitality
+10,700
-11.5%
Healthcare
+10,200
Never Lost Jobs
Professional/Business Services
+6,800
-18.4%
Construction
+6,500
-57.0%
Retail Trade
+4,800
-18.0%
Local Government
3,600
-18.7%
Financial Activities
+2,300
-14.0%
Manufacturing
+1,800
-21.7%
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Arizona Won’t Truly Recover Until
Housing Improves
• Excess supply of homes – 70,000 in Greater Phoenix alone
• Home prices down over 50% - to early 2000’s levels
• Arizona is one of the worst performing states for mortgage
delinquencies and foreclosures
• New home construction has all but ceased
• Commercial real estate market is hurting
• Market will not recover until household formation and jobs return
• On the positive side - housing is now much more affordable, and
interest rates are at historic lows
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AZ Outlook and Summary
Upside:
• Economic indicators are finally improving
• The recovery is now underway
• AZ’s economy will continue to diversify
Downside:
• Housing market is still a mess
• Depressed population mobility
• Budget constraints in public sector
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Implications for MCCCD
• For MCCCD, the recession is a double-edged sword
• District needs to look at new revenue streams
– Alternative delivery
– Contract training, grants, partnerships
• Focus on high-wage, high-skill jobs to reduce the region’s
vulnerability to recessionary cycles
– Alleviate skills gap (structural unemployment)
– Underserved and emerging populations
– Provide training for “disaggregated” jobs
• Short-term – Slow population and economic growth, little help
from state
• Long-term - Arizona is projected to add 1.8m new jobs in the next
30 years. Many will be in Maricopa County. MCCCD will play a vital
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role in training
Questions?
[email protected]
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