Bookmark and Share Business News in the South from The Randle Report

 

Sign up for Randle Report Daily Emails for all The South's Business and Political News Follow Randle Report on Facebook for Business News in the South Follow Randle Report on Twitter for all The South's Business and Political News

 

 

Unemployment Rates in the South  

are about to Drop

 

Mike Randle, Editor

Note: In addition to being the editor of The Randle Report, Mike Randle is the editor of Southern Business & Development magazine (www.SB-D.com), the leading economic development publication in the Southern region. This article was published in a recent edition of SB&D.

The skeptics of the current economic recovery from the recession of 2008 and 2009 won't quit squawking until unemployment rates drop from the 8 to 12 percent seen in many areas of the country to 6 to 8 percent. While those lower rates will not be accomplished next year in many U.S. states, my bet is the South's average unemployment rate at the end of 2011 will be no higher than 6.5 percent, possibly lower. The regional rate is currently hovering at about 8.7 percent. That's a prediction of more than a 2 percent drop in a little more than a year. 

The really cool thing about following and tracking economic development closely is you can see the job market’s future more clearly than what can be seen by gathering information from any other source. 

For example, when a company announces a project, the jobs associated with that project typically don't factor into the employment picture for six months to a year. It’s even longer than that with very large projects of over 1,000 jobs, like Volkswagen's plant in Chattanooga that will open next year, Samsung's announced expansion in Austin and the ThyssenKrupp project that began operating in South Alabama in August. TK was announced in 2007 and they are just now ramping up their hiring.

So, when a talking head on the cable news rants about a "high unemployment rate that’s frozen" (like what was present during the summer and the beginning of the fall quarter), and asks "When are companies going to start hiring again?" well he or she is already six to 12 months behind the data flow that we in economic development use. If you are tracking all of the economic development projects currently and you have an 18-year book of history for each quarter as we do, it is very clear that companies are hiring now and fast in the American South.

How does the economic development crystal ball tell us that unemployment rates are about to drop and drop a lot next year? That's easy. This summer there were more projects announced by business and industry in the South than any quarter in three years. The winter and spring quarters of this year were also very good in new and expanded projects. That's three solid quarters in a row of improving deal activity in the South.

Surely that can't be the case you say. After all, many economists are not only predicting a double-dip recession, some think we are in a depression. We see and hear it on the cable news every day and night, right? Well, they are wrong.

Southern Business & Development prides itself in publishing almost, if not every single significant project announced in the South each and every quarter. And unlike other magazines, we don't just publish those projects on our Web sites, where space for copy is infinite. We put all of them in the print product you are holding in your hand.

In the summer of 2010, there were so many projects announced in the South that we had to expand our Relocations & Expansions section (page 20) to eight pages in this issue with a jump to page 60. Typically we run five R&E pages and that was a stretch between 2007 and 2009.

Because we own www.SouthernAutoCorridor.com, we have our own section in this magazine that exclusively focuses each quarter on projects from the automotive industry. For the second straight quarter the SouthernAutomotiveCorridor.com News section (page 26) is four pages long and profiles 44 large automotive projects that were announced in the South in the summer. That section had to jump to page 62 to fit those projects in. A year ago, we couldn't find enough automotive projects in the South to fill the two pages of space we typically allotted.

Again, almost all of the 40,000 direct jobs associated with this summer's surge in announced projects won't factor into the South's unemployment rate for six months to a year or longer. However, some of the indirect jobs created by those projects, like construction jobs, will show up within the next three or four months.

In other words, the projects found in our Relocations & Expansions and SouthernAutoCorridor.com News sections in this issue (go to www.SB-D.com) are commitments by companies to hire, but the bulk of those hires won't show up on the Bureau of Labor Statistics’ Web site until 2011. And combined with mass layoff events that peaked at almost 3,000 in February of 2009, but now are down to 1,600 in August 2010, the surge in job generating projects in the South throughout 2010 will mean one thing: an unemployment rate in 2011 that will eventually shut up the skeptics. How refreshing will that be?  




1 Comments

  • wow gold 2 years 267 days ago
    Very good and useful information. Why not write a book about this topic.For today’s economic fluctuation and lack of opportunities, it really will be a very hot topic. Thanks anyway. All the best.

    Reply
Add Comment

(required)

(required)

CAPTCHA image
Enter the code shown above in the box below
  Post Comment
 

 

 

 

Most Liked Stories (past 24 hrs.)


Most Disliked Stories (past 24 hrs.)


Features & Opinion

 Top Ten Places in the South for Relocating California Companies

Urban areas have all kinds of assets that are easy to spot. They have the population, so the labor shed is not usually an issue. Urban areas are also connected by better roads, rail and air service and many have river and deep water ports. Usually Internet access and other forms of communication are more efficient in urban areas. And you have a larger array of quality of life options to choose from, such as the cultural assets found in metropolitan areas.
 

 Randle Report - Business News in the South

 FEATURE  
By Stacy Randle
Demographer Wendell Cox recently analyzed the largest gains in holders of bachelor's and post-graduate degrees between 2007 and 2012 in the 51 metro regions in the U.S. of 1 million residents or more. The results were published in Forbes magazine and the South dominated the ranking.
 

 Business News in the South - Randle Report

FEATURE     
After I finished the cover story for this issue, I read an interesting article by economist Paul Krugman, the op-ed columnist for the New York Times, titled, "Partying like it’s 1995." Generally I side with Krugman, even though I am a journalist, not an economist. Occasionally, though, I read some of his stuff and ask myself, "What planet did Krugman come from?" Like when he predicted a shift of automotive assembly to Canada after Toyota announced a new plant in Woodstock, Ontario in 2005 because of "free healthcare," among other benefits. That Toyota deal was the last major automotive assembly plant announced in Canada and I predict it will be the very last one for the Canadians.
 
 Nashville Mayour Karl Dean
If you have ever seen one of my presentations, then you know about the word "reshoring" and how that phenomenon has lifted the spirits of even the most skeptical Southerners regarding the future of the region's economy. After all, in the last four decades, manufacturing has suffered a bloodletting never before seen in U.S. history. The biggest factor behind the slow and long meltdown that began in the 1990s was the herd mentality to offshore manufacturing capacity to cheaper locales, primarily by U.S.-owned companies.
 


 

 

http://www.alliancece.com
Southern Business & Development Southern Auto Corridor Small Town South Randle Report

Copyright ©2015 Randle Report
All of the South's Business News, Political News, and Economic Development News in One Place
Login