economic outlook douglas, az. cochise college center for economic research lower levels of...

Economic OutlookDouglas, AZ

Cochise College Center for Economic Research

Lower levels of production Job losses/rising unemployment Less income Lower levels of sales Stock market declines Loss of consumer and investor

confidence Financial crisis

Cochise College Center for Economic Research

Peak Trough Duration (Months)

February 1945 October 1945 8

November 1948 October 1949 11

July 1953 May 1954 10

August 1957 April 1958 8

April 1960 February 1961 10

December 1969 November 1970 11

November 1973 March 1975 16

January 1980 July 1980 6

July 1981 November 1982 16

July 1990 March 1991 8

March 2001 November 2001 8

December 2007 ? 18 (and counting)

Cochise College Center for Economic Research

-7%

-5%

-3%

-1%

1%

3%

5%

I 2005 II III IV I 2006 II III IV I 2007 II III IV I 2008 II III IV I 2009

Seasonally Adjusted Annual Rate

Cochise College Center for Economic Research

Cochise College Center for Economic Research

-1%

0%

1%

2%

3%

4%

5%

6%

Jan2007

Mar May Jul Sep Nov Jan2008

Mar May Jul Sep Nov Jan2009

Mar

Compared to same month previous year

Cochise College Center for Economic Research

Recovery likely in late 2009 Positive signs in recent weeks Financial crisis will slow

recovery and growth Economic stimulus will have

impact

How Cochise County andDouglas are impacted

Cochise College Center for Economic Research

Cochise College Center for Economic Research

-25%

-20%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%Ja

n 07

Feb Mar

Apr

May

Jun

Jul

Aug

Sep Oct

Nov

Dec

Jan

08

Feb Mar

Apr

May

Jun

Jul

Aug

Sep Oct

Nov

Dec

Jan

09

Feb Mar

Inflation adjusted; compared to same month previous year

Cochise College Center for Economic Research

-10%

-5%

0%

5%

10%

15%

20%Ja

n 07

Feb Mar

Apr

May

Jun

Jul

Aug

Sep Oct

Nov

Dec

Jan

08

Feb Mar

Apr

May

Jun

Jul

Aug

Sep Oct

Nov

Dec

Jan

09

Feb Mar

Compared to same month previous year

Cochise College Center for Economic Research

0

2

4

6

8

10

12

14

16

Peso

s to

U.S.

Dol

lar

-10%

-5%

0%

5%

10%

15%

20%

Reta

il Sa

les T

ax G

row

th

Exchange Rate Retail Sales Tax Revenue

Cochise College Center for Economic Research

Cochise County retail market in recession since November 2007 2009 (Jan-Mar): -9.4% 2008: -6.5% 2007: -1.3%

Douglas Retail Sales Tax Revenue 2009 (Jan-Mar): -2.0% 2008: 6.1% 2007: 2.2%

Cochise College Center for Economic Research

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

Jan

07

Fe

b

Ma

r

Ap

r

Ma

y

Jun

Jul

Au

g

Se

p

Oct

No

v

De

c

Jan

08

Fe

b

Ma

r

Ap

r

Ma

y

Jun

Jul

Au

g

Se

p

Oct

No

v

De

c

Jan

09

Fe

b

Ma

r

Cochise County Douglas

Inflation adjusted; compared to same month previous year

Cochise College Center for Economic Research

Cochise County restaurant & bar sales in recession since October 2007 2009 (Jan-Mar): -2.9% 2008: 0.2% 2007: 0.1%

Douglas restaurant & bar sales in recession since at least July 2007 2009 (Jan-Mar): 0.4% 2008: -7.7% 2007: -2.9%

Cochise College Center for Economic Research

County retail sales at or near bottom—recovery likely in late 2009

City-level retail sales tax revenue helped along by tax rate increase

Stronger Peso may help Restaurant & bar sales at or near

bottom—recovery likely in mid-2009

Cochise College Center for Economic Research

Cochise College Center for Economic Research

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

2001

2002

2003

2004

2005

2006

2007

2008

2009

*

United States

Arizona

Cochise County

Douglas (ADOC)

Douglas (CER)

* Jan-Apr only; seasonally adjusted

Cochise College Center for Economic Research

2.5%

3.5%

4.5%

5.5%

6.5%

7.5%

8.5%

9.5%

10.5%

11.5%

Apr2008

May Jun Jul Aug Sep Oct Nov Dec Jan2009

Feb Mar Apr

United States

Arizona

Cochise County

Douglas (ADOC)

Douglas (CER)

Seasonally Adjusted

Cochise College Center for Economic Research

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

May2008

Jun Jul Aug Sep Oct Nov Dec Jan2009

Feb Mar Apr

Compared to same month previous year

Cochise College Center for Economic Research

275

-450

-425

-325

-250

-75

-675

-100

-125

575

-800 -600 -400 -200 0 200 400 600

Professional and Business Services

Government

Information

Other Services

Manufacturing

Educational and Health Services

Leisure and Hospitality

Financial Activities

Trade, Transportation, and Utilities

Construction

12 months ending Apr 2009

Cochise College Center for Economic Research

2.2%

-6.0%

-6.7%

-7.6%

-10.5%

-16.7%

-31.0%

10.8%

-14.3%

-38.6%

-50% -40% -30% -20% -10% 0% 10%

Professional and Business Services

Government

Educational and Health Services

Trade, Transportation, and Utilities

Leisure and Hospitality

Other Services

Information

Manufacturing

Construction

Financial Activities

12 months ending Apr 2009

Cochise College Center for Economic Research

Expect continued job losses & rising unemployment

Local area will fare better than, and begin to recover before, state and nation

ADOC data for Douglas will continue to overstate unemployment

Cochise College Center for Economic Research

Cochise College Center for Economic Research

0

200

400

600

800

1000

1200

2003 2004 2005 2006 2007 2008

Co

ch

ise

Co

un

ty

0

10

20

30

40

50

60

70

80

90

Do

ug

las

Cochise County Douglas

Single Family Residential Building Permits

Cochise College Center for Economic Research

Cochise County 2009, 1st Qtr: 66 (-45.5%) 2008: 404 (-14.4%) 2007: 472 (-47.6%) 2006: 900 (-18.8%)

Douglas 2009, Jan-Apr: 3 (-72.7%) 2008: 15 (-60.5%) 2007: 38 (-42.4%) 2006: 66 (-18.5%)

Cochise College Center for Economic Research

Cochise County 2009, Jan-Apr: 306 (-10.3%) 2008: 1,120 (-20.0%) 2007: 1,400 (-10.6%) 2006: 1,566 (-20.7%)

Douglas 2009, Jan-Apr: 25 (-21.9%) 2008: 102 (-3.8%) 2007: 106 (10.4%) 2006: 96 (5.5%)

Cochise College Center for Economic Research

14

10

7

9

78

10

3

6

17

87

15

8

5

89

8

5

7

11

3

7 7

02468

101214161820

May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr

Previous Current

Cochise College Center for Economic Research

$50,000$65,000$80,000$95,000

$110,000$125,000$140,000$155,000$170,000$185,000$200,000

2004 2005 2006 2007 2008 2009*

Cochise County Douglas* Jan-Apr only

Cochise College Center for Economic Research

Cochise County 2009, Jan-Apr: $175,970 (-

6.9%) 2008: $184,000 (-5.6%) 2007: $195,000 (1.3%) 2006: $192,569 (10.7%) 2005: $173,900 (24.3%) 2004: $139,900

Douglas 2009, Jan-Apr: $90,000

(4.0%) 2008: $89,750 (-0.3%) 2007: $90,000 (-1.1%) 2006: $91,000 (35.8%) 2005: $67,000 (21.8%) 2004: $55,000

Cochise College Center for Economic Research

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

2003 2004 2005 2006 2007 2008

Va

lua

tio

n

Cochise College Center for Economic Research

New residential construction likely at or near bottom (county & city)

Existing home sales approaching bottom

Home prices should continue to hold or decline modestly

Commercial construction has remained relatively strong, but no new projects

Cochise College Center for Economic Research

Most of the recession is probably over

There have been some signs that we’re at the bottom

The economic stimulus package will have an impact on the economy

Employment probably won’t improve until late 2009 or early 2010