The Monday Morning Quarterback
A quick analysis of important economic data released over the last week
By Elliot D. Pollack & Co. | Rose Law Group Reporter
The U.S. Census Bureau released some important data this month. Maricopa County was found to be the fastest growing county in the U.S. between July 2020 and July 2021, increasing by 58,246 persons. While this is an important distinction, of more significance are the estimates for the metropolitan areas of the country since some states like Texas have small counties that combine into large metros. Greater Phoenix, which is made up of Maricopa and Pinal counties, was the second fastest growing metro area with an increase of 78,220 persons. Dallas was number one with a 97,270 person increase. Houston and Austin rounded out the top four spots. Tucson grew by slightly more than 6,400 persons.
The places that lost the most population are the usual suspects – New York (-335,563), Los Angeles (-327,955), San Francisco (-116,385), and Chicago (-91,671). Even Boston lost 36,579 persons. The U.S. grew by a very modest 0.1% for the year ending July 2021 (392,665 persons). The data confirms the historic trend of the U.S. population migrating south and from the more expensive east and west coasts. Beyond Arizona and Texas, the top growing metro areas are situated in Florida, North Carolina, South Carolina, Tennessee, and Georgia. Boise is the only northern metro area to make the list with an 3.34% growth rate, one of the top rates in the country.
The Census estimates that 90% of the change in population in Greater Phoenix came from net migration or 70,097 persons. Natural change, or births over deaths, only accounted for an increase of 8,142 persons.
The Arizona unemployment rate for February declined to 3.6%, slightly below the national average of 3.8%. Essentially, we are at full employment. One year ago, unemployment in the state stood at 6.0%.
Despite the economic headwinds facing the U.S., Arizona is showing much resilience. Our economy is diversifying in ways we couldn’t image a few years ago. While we will still be facing inflationary impacts, labor shortages, supply chain disruptions, and the effects of the Ukrainian war, there are few better places in the U.S. to put down your roots.
- The Consumer Sentiment index remained low in the second half of March. The level was 59.4%, down 5.4% for the month and 30% from a year ago. Inflation has become the primary reason for pessimism among consumers.
- New home sales dropped in February. Higher mortgage rates will start to push affordability down, adversely affecting buyers without a significant down payment, especially first-time buyers. Overall, the housing market is expected to remain strong as pent-up demand continues at very high levels.
- Interest rates and a lack of available for-sale inventory dragged down NAR’s Pending Home Sales Index for the fourth consecutive month. Demand remains strong with multiple offers for properties. But, the recent increase in interest rates makes buying more difficult, especially for buyers with a tight budget.
- On a not seasonally adjusted basis, Arizona added 27,400 jobs. Educational and Health Services, Professional & Business Services, Government and Leisure & Hospitality accounted for 20,300 of the jobs created. Only the Information sector saw a decline.
- Since the recovery began, Arizona has added 376,500 jobs (338,700 were lost). Leisure & Hospitality has recovered the most jobs (132,600) but remains 14,500 below the previous high of 341,100 jobs. Trade, Transportation, and Utilities has created the second most jobs (96,800) and is now well above its previous peak. Government and Mining & Logging are the only two super sectors with additional job losses.
- Greater Phoenix created 18,400 jobs in February. Professional & Business Services and Educational & Health Services added nearly half of the jobs created in the month. Information was the only sector that lost jobs.
- Greater Tucson added 3,900 jobs last month. 2,700 of the jobs created were in Professional & Business Services, Leisure & Hospitality and Government. Information was the only sector that lost jobs. After the revision, Greater Tucson remains 6,100 jobs below its February 2020 level.
- Retail sales collection in January (December sales) were down from the Christmas rush, which is not unusual. On a monthly basis, retail sales fell 24% in Arizona and in Maricopa County. Both regions remained well above the January 2021 levels, as the State was up 15.6% and the County was up 17.2%.