January, 2011— Winter Issue January, 2011— Winter Issue Recovery Hits a “Soft Patch” By Marshall J. Vest Forecasting Project Director December 1, 2010 The Great Recession ended a year-and-a-half ago. So far the recovery has been slow and disappointing. Nationwide, real GDP declined by 4% during the recession, and since the recession ended, real GDP has grown by 3.5%. It will be at least the first quarter 2011 before the previous peak is regained. Headwinds are numerous and worrisome. The boost from fiscal stimulus is now fading and inventory rebuilding is nearly complete, so it’s time for consumers and businesses to provide leadership. Unfortunately, A nice recovery was underway consumers remain cautious over worries about poor job proin Arizona’s economy during spects, falling housing values, the first half, but since June most of those gains have been and tight credit, while businesses remain on the sidelines due given back. The best descripto uncertainty over future taxes, tion now is that Arizona’s economy is bumping along the rising health care costs spurred by “ObamaCare,” new financial bottom. We expected condiregulations still in the making, tions to soften during the and weak demand from con“payback” period following expiration of homebuyer cred- sumers. its and winding down of fedThe underlying key problem is eral stimulus spending. What’s that the de-leveraging process is surprising is that private sec- not yet complete. Aggregate tor demand has not been measures for household credit strong enough to keep the continue to fall; as of Septemrecovery progressing. We still ber 30th, total consumer indebtexpect momentum to build as edness has fallen by nearly $1 we move into the New Year trillion from its peak of $11.6 and that a “double-dip” will trillion, a decline of almost 8%. not develop. The best bet is The values of outstanding mortthat the recovery will proceed gages have declined by 7.4% slowly during 2011 due to a and home equity credit lines by multitude of headwinds, and 5.7% from their respective peaks (Exhibit 1). that more robust growth will follow. Unfortunately, this contraction of credit is far from over: at the end of the third quarter, 11.1% of outstanding household debt ($1.3 trillion) was in some stage of delinquency. Credit is shrinking not only because of chargeoffs; consumers also are now paying down their balances – a major change in behavior from a few years ago. Inside This Issue: R P “ 1 ” Marshall J. Vest S F U 6 Marshall J. Vest N C Business credit also continues to deflate. Total credit on the books of commercial banks advanced to “business, commercial, and real estate” borrowers has declined from its mid-2008 peak of $5.2 trillion by roughly 15%. In the commercial paper market (large companies borrowing directly from credit markets thereby bypassing commercial banks), commercial paper F I 7 P A ’ P T C Lora Mwaniki‐Lyman and Daniel J. Kinnear E D F 14 AZ E ‐ Exhibit 1: Household Credit Still Deflating Household Credit, U.S. $ bill 3000 $ bill 12000 2500 10000 2000 8000 6000 1500 consumer credit (left) 4000 1000 500 0 2000 home mortgage credit (right) 80 85 90 95 00 05 10 www.ebr.eller.arizona.edu 0 17 Arizona’s Economy outstanding has plunged from $2.2 trillion in the second quarter of 2007 to less than $1.1 trillion in recent months (Exhibit 2). Exhibit 2: Business Credit Also Deflating Business Credit, US $ bill 6000 $ bill 2200 5000 2000 1800 4000 1600 3000 1400 2000 1200 1000 0 1000 80 85 90 95 00 05 800 10 Commercial Banks: Bus & Comm & Real Estate Credit (left) Commercial Paper Outstanding (right) Federal Budget Gap as Percent of GDP percent 26 24 expenditures as % of total GDP 22 20 18 revenues as % of total GDP 85 2 90 95 00 05 Most economists expect this de-leveraging process to run a while longer before credit begins growing again. That means a slow recovery, at best. The Federal Reserve has pumped unprecedented amounts of money into credit markets, but the “velocity of money” has ebbed as the “demand for liquidity” soared. We arguably are in a text-book style “liquidity trap.” Commercial banks, for example, are sitting on some $1.2 trillion of cash reserves (normal is around $300 billion). Sometime, hopefully sooner rather than later, money will begin to move, credit will expand once again, and the pace of recovery will accelerate. Meanwhile, Congress is facing gridlock on a number of policies that will affect the economy. The most important are the “Bush” tax cuts, which are scheduled to expire at the end of the year. Add to that emergency unemployment insurance benefits (that will begin to expire at the end of November and will disappear by May 1), Medicare reimbursement rates for physicians, extension of the AMT fix that expired a year ago, and various tax credits such as Making Work Pay and other ARRA tax incentives set to expire at year end. If Congress is unable to act, it will cost the economy 1.5% of GDP growth in 2011 and 1.8% the following year, according to estimates from IHS Global Insight. Exhibit 3: Priority Best Left For the Future 80 Since the economy “floats on a sea of credit,” it’s not surprising that the recovery is disappointing. What’s surprising is that the economy has grown as much as it has, given that credit is still contracting. (It’s only because of the large cash balances held in the corporate sector that allowed businesses to restock inventories, that we’ve had any recovery.) Financial crises are the result of asset bubbles, which in turn are driven by an expansion of credit. The recent bubble was made possible by “financial innovations” in the securitization of mortgages, resulting in an enormous expansion of credit. Now credit has to shrink as financial entities and consumers restructure their balance sheets. 16 10 15 20 14 Yes, the federal budget deficit is monstrous and needs to be reduced -- just not right now! Raising taxes and reducing spending before the recovery is on solid footing would be a monstrous mistake. Exhibit 3 shows the budget gap; as a percent of gross domestic product (GDP), expenditures are at 25%, and revenues stand at record lows near 15%. The projections assume the President’s Deficit Commission revenue proposals are implemented (including elimination of ”tax expenditures, such as mortgage interest and real property tax deductions” as well as higher gasoline taxes). Add Arizona’s Headwinds On top of shrinking credit, Arizona is facing some unique challenges. The housing bubble, along with the effects of recent anti-immigration legislation, has burdened Arizona with an enormous inventory of vacant housing. Data compiled by the U.S. Department of Housing based on U. S. Postal Service surveys, shows nearly 130,000 vacant addresses in Arizona’s six Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Exhibit 4: Residential and Business Vacancies, Metro Arizona, Sept. 2010 Total Addresses Area residential Vacant Addresses business residential Percent Vacancy business residential business 49,117 4,592 830 390 1.7 8.5 100,061 7,252 7,209 982 7.2 13.5 1,861,570 155,067 91,687 19,249 4.9 12.4 Prescott, AZ 97,710 9,773 1,328 404 1.4 4.1 Tucson, AZ 454,559 29,055 26,826 4,493 5.9 15.5 69,874 4,877 2,103 243 3.0 5.0 2,632,891 210,616 129,983 25,761 4.9 12.2 Flagstaff, AZ Lake Havasu City‐Kingman, AZ Phoenix‐Mesa‐Glendale, AZ Yuma, AZ Metro Arizona metro areas. That’s a vacancy rate of 4.9%. Historically, vacancies have run in the neighborhood of 1.5%. Business vacancies stand at 12.2% (Exhibit 4). This excess inventory of vacant homes needs to be significantly reduced before homebuilding resumes. Unfortunately, household formation has virtually disappeared. Mobility in this country remains at the lowest levels in at least 60 years, thanks to the credit squeeze and inability of home owners and buyers to sell their existing house (many are “upsidedown”) and to obtain financing for a new one. In addition, the poor economy and high unemployment has forced households to double up. Housing remains near the bottom by nearly any measure. After a boost early in the year from the homebuyer tax credit, residential permits have sunk to new lows. Only 13,000 units will be issued statewide this year, compared to over 91,000 in 2005. Existing home sales through multiple listing services (MLS) also have retreated in both large metros since tax credits expired. This was widely expected as payback for activity brought forward by tax incentives. Arizona has consistently over the past three years ranked in the top four states for foreclosure activity. According to data provided by RealtyTrac, Inc., Arizona ranked third in October with 1 in every 165 homeowners receiving a foreclosure notice (which includes default notices, auction sale notices and bank repossessions). Only Nevada and Florida ranked worse. Nationwide, 1 in every 389 received a notice. Corresponding numbers for Pinal County were 1 in 94, Maricopa County 1 in 134, and Pima County 1 in 264. Fortunately, foreclosures in Arizona are no longer trending upward, but they remain close to record highs. Using realtor data, home prices have stabilized. After a few months of improvement earlier in the year, the median price of homes sold on the MLS leveled off in recent months and risk moving lower. Data from Standard and Poor’s Case Shiller also show the same results. Prices are nearing $140,000 in Tucson and $120,000 in metro Exhibit 5: Another Down leg for Home Prices? Home Prices, Metro Phoenix S&P/Case-Shiller and Realtor Data $ 000s 300 index 250 250 200 200 realtor median prices of homes sold (L) 150 150 50 100 Case‐Shiller Index (R) 100 96 98 00 02 04 06 08 10 50 www.ebr.eller.arizona.edu 3 Arizona’s Economy Exhibit 6: A Leading indicator Points Upward Phoenix. The flood of foreclosures will continue to cap (or put downward pressure on) prices in the near term (Exhibit 5). Employment Services Jobs, Arizona seasonally adjusted 000s 140 120 100 80 60 40 90 95 00 05 10 Recent Trends and Outlook Nationwide, the manufacturing sector has been a bright spot, accounting for much of the progress during the recovery. Indicators such as exports, factory orders and industrial production have been trending upward. That hasn’t translated into jobs, however. In Arizona, manufacturing jobs have stopped falling, after declining by over 20% during the recession and by nearly a third over the past decade. The number of manufacturing jobs now is the lowest since early 1983! Employment services, a leading indicator since employers turn to temporary workers before making permanent hires, is an encouraging sign, having added 8,700 workers over the past year. Health care & social services have added 7,500, and the federal government added 4,400 over the same period (Exhibit 6). 20 Construction is the biggest loser, having shed 8,100 jobs during the past 12 months, followed closely by state and local non-education, down 6,100. Aerospace manufacturing (-3,300), wholesale trade (-2,600) and financial services (-2,200) also continue to decline. From the end of 2009 through May, nonfarm employment was rebounding nicely, but since then, nearly all of the gain has been given back. Compared to a year ago, employment is little changed (Exhibit 7). Exhibit 7: Employment has Changed Little From Year Ago Nonfarm Jobs, Arizona seasonally adjusted 000s 2700 2600 % chg 10 annual rate m/m (R) 5 2500 0 2400 2300 -5 number of jobs (L) 2200 -10 2100 2000 4 98 00 02 04 06 08 10 -15 Measures of consumer spending also have given back earlier gains. Retail sales statewide have mirrored the path of employment – solid gains early in the year have been lost in recent months, so that seasonally adjusted sales in August were lower than the year earlier. Likewise, restaurant and bar sales have turned down although they remain above cycle lows. Airline passenger traffic at Sky Harbor and Tucson International also has given back portions of prior gains (Exhibit 8). Recent trends are not encouraging. The possibility of a double dip cannot be ruled out at this juncture. So when will the recovery finally get on track? We’ve had some encouraging news over the past year in solar and biotechnology industries, with several companies moving to or expanding in the state. So far, this hasn’t resulted in many new jobs, but it’s encouraging that industries with some growth potential are choosing Arizona. Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue For Arizona’s economy to accelerate, homebuilders need to get busy again. That won’t happen until inventories of vacant houses are reduced. And, with mobility at decades-low levels, that may be awhile. Mobility won’t recover until credit markets heal and the de-leveraging process comes to an end. Care to guess how much longer that will take? Keep your eye on credit flows, the key to the whole process. When credit begins expanding again, good things will start to happen. Exhibit 8: Air Passenger Traffic is at 2004 Levels Airline Passengers millions, seasonally adjusted annual rate, smoothed 45 5.0 Phoenix Sky Harbor (L) 40 4.5 We expect Arizona’s economy to improve modestly as we move into 2011. Population and employment will both grow at less than 2% annual rates. Personal income will eke out a very modest sub-four percent gain. Replacement buying will lift retail sales but consumers will continue to exercise their newly-found emphasis on thrift. The following year, 2012 will see the pace quicken but it will be 2013 before employment growth tops 100,000 and population growth approaches 170,000, levels that were common during the late 1990s (Exhibit 9). 35 4.0 30 3.5 Fortunately, there is not much risk to the downside, since homebuilding and allied industries have very little left to lose. This was not a typical, garden-variety, recession. The recovery so far is (and promises to remain) atypical as well. 15 Tucson International (R) 25 3.0 20 2.5 90 92 94 96 98 00 02 04 06 08 10 2.0 Exhibit 9: Recovery Will Proceed Slowly Annual Change in Population and Jobs Arizona 000s 300 200 100 0 -100 -200 80 85 90 95 00 05 -300 10 www.ebr.eller.arizona.edu 5 Arizona’s Economy Exhibit 1: Most “Solutions” Have Been Temporary State Fiscal Update Budget Solutions as a Share of Shortfall (totaling $12.5 billion since FY ‘08) By Marshall J. Vest Forecasting Project Director Arizona is one of 46 states facing a budget deficit in the current fiscal year that ends next June. As a percentage of enacted budget, Arizona ranks 4th in severity with a 38% gap . Only Nevada, Illinois, and New Jersey are worse. Latest estimates from the Arizona Joint Legislative Budget Committee show a current year shortfall of $825 million and a $1.4 billion gap in FY 2012. This does not include some $1 billion in suspended funding formulas. A “structural shortfall” gap in excess of $1 billion persists as far as the eye can see. Since FY 2008, the state has enacted some $12.5 billion in “solutions” to budget shortfalls. Most of these have been of a “temporary” nature such as borrowing, fund transfers, rollovers (delaying payments until the following year), a 1-cent temporary sales tax increase, and federal assistance (Exhibit 1). Exhibit 2: There are Three Main Drivers of Spending Arizona General Fund Spending ($millions), FY 2011 total = $9,524.3 million Clearly, not nearly enough was available from the “Rainy Day” fund, better known as the Budget Stabilization fund. This fund is capped at 7% of prior year spending, which represents less than one month’s spending. The temporary 1-cent increase in sales taxes accounts for only 7% (or $900 million so far), and this source will expire in June 2013. Federal assistance to Medicaid and education will expire in FY 2012 (along with attached maintenance of effort restrictions), which totals roughly $900 million annually. Voters rejected two referendums in November that would have provided $469 million in additional transfers. Very little money in “temporary solutions” remains. Given rejection of augmenting revenues (raising taxes) by both voters and politicians, we can expect big cuts in spending in the months to come. Where will the cuts fall? Some still believe that there is a lot of “fat” in government spending that can be cut. Facts show that over 87% of general fund spending now goes to education, healthcare, and prisons (Exhibit 2). 6 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue New Financial Index Captures Performance of Arizona’s Publicly Traded Companies1 By: Lora Mwaniki-Lyman and Daniel Joseph Kinnear The stock performance of Arizona’s publicly traded companies represented in the L&D Arizona Composite Index, have tracked the DJIA Index and S&P500 Index since the beginning of the great recession (Graph 1). The L&D Arizona Composite Index is a price-weighted, all market capitalization index made up of companies headquartered in Arizona and publicly traded on the NYSE and NASDAQ. The index, like any price-weighted index (such as DJIA), gives an overview of the direction stock prices of companies in Arizona are moving by focusing on stock value. By doing so, it provides a proxy of investor sentiments and their expectations and perceptions of the performance of Arizona-based Companies. The index is also not a performance-based index since it does not include company dividend payouts and options, and therefore should not be used as an investment tool. As a regional market index, the L&D Arizona Composite index provides a snap shot of Arizona’s economic health or performance overall. However, it is not a measure of the local business conditions since Arizona is home to companies that operate on a national and global scale. Eligible Companies A company must meet three requirements to be included in the L&D Arizona Composite Index: 1) Be headquartered and have principal executive presence in the state of Arizona. It does not necessarily have to be incorporated in Arizona. The index therefore excludes American Depository Receipts 1 The Economic and Business Research Center does not offer any financial advising or recommend that investment decisions be based purely on the performance of the L&D Arizona Composite index and sub-indices. Therefore investment decisions are the sole responsibility of the reader. Graph 1: L&D Arizona Composite Index and DJIA Index 16,000 140 14,000 120 12,000 100 10,000 80 8,000 60 6,000 40 4,000 20 2,000 0 0 DJIA Index LD Arizona Composite Index Data Source: Yahoo Finance and EBR www.ebr.eller.arizona.edu 7 Arizona’s Economy Graph 2: Breakdown by Market Capitalization (November 3, 2010) 5% 15% Small Cap Mid Cap Large Cap (ADRs) which are foreign owned entities trading in the NYSE. Publicly traded companies with a major Arizona presence but not headquartered in Arizona, such as Raytheon, are not included. 2) Be regulated by the Securities Exchange Commission (SEC) and file periodic reports as required such the quarterly earnings reports among others. Consequently, it excludes companies traded on the Over-the -Counter (OTC) markets that are generally not under SEC oversight. 3) Have presence in the two most liquid exchanges, the NYSE and NASDAQ which present real time market value of stocks; over-the-counter markets are not as liquid. In addition, small cap and micro companies traded in the American Exchange (AMEX) are also excluded. Thirty-nine Arizona-based companies meet these criteria. 79% Data Source: Yahoo Finance and EBR About the L&D Arizona Composite Index “Of the thirty-nine companies in the index, more than three-quarters of the companies are small cap with a market capitalization of less than $2 billion as of November 2010. “ The index is broken into two exchange-specific, subindices: the L&D Arizona Tech sub-index, which includes twenty-six companies, listed on the NASDAQ; and the L&D Arizona 13 sub-index, which includes the thirteen Arizona companies listed on the NYSE. Of the thirty-nine companies in the index, more than three-quarters of the companies are small cap with a market capitalization of less than $2 billion as of November 2010. Mid cap companies with market capitalization of between $2 billion and $10 billion make 15 percent of the index (Graph 2). Table 1: Top 10 Companies in Index by Market Capitalization (11/3/10) Company Ticker Symbol Stock Exchange Market Cap (mil, 11/3/10) FCX NYSE 47900.00 FSLR NASD 11600.00 MCHP NASD 6300.00 APOL NASD 5200.00 AVT NYSE 4700.00 Pinnacle West Capital Corp. PNW NYSE 4600.00 PetSmart Inc. PETM NYSE 4600.00 ONNN NASD 3400.00 LCC NYSE 1900.00 UHAL NASD 1800.00 Freeport‐McMoran Copper & Gold Inc. First Solar Inc. Microchip Technology Inc. Apollo Group Inc. Avent, Inc. ON Semiconductor Corp. US Airways Group Inc. Americo Data Source: Yahoo Finance and EBR 8 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Freeport-McMoran Copper & Gold Inc. (NYSE:FCX) and First Solar Inc. (NASDAQ:FSLR) are the only two large cap companies, with market capitalization of $45.7 billion and $11.8 billion (11/3/10) respectively. Top ten companies by market capitalization as of November 3, 2010 are listed in Table 1. Table 2: Index Market Capitalization, November 3, 2010 Number of Companies: A breakdown by NAICS categories below reveals that the index is heavily weighted in manufacturing and particularly in the high-tech sector (Table 3). Over three-quarters of the publiclytraded firms in Arizona fall under the NAICS manufacturing categories, with seventy percent of them being computer and electronic products manufacturing and the remaining being in the chemical and food manufacturing sectors. All but two of the companies under the NAICS manufacturing classification (NAICS 31-33) are traded in the NASDAQ. Hypercom Corp. (NYSE:HYC) and Medicis Pharmaceutical Corp. (NYSE:MRX) are traded in the NYSE. Technology companies such as First Solar Inc. (NASD:FSLR), Microchip Technology Inc. (NASD:MCHP), and ON Semiconductor Corp. (NASD:ONNN) led the charge, while firms like Mobile Mini Inc. (NASD:MINI) and Amerco (NASD:UHAL) rode the housing market upward, contributing to the Tech sub-index’s positive performance during the pre-recession period. L&D Arizona 13 Sub-Index When assessed by exchange, it is evident that Arizona’s two exchange-specific sub-indices closely tracked the performance of the major market indices their companies belong to; the Dow, S&P 500 and the NASDAQ. The L&D Arizona 13 Sub-Index represents mining, utility, trade and transportation companies traded in the NYSE. While the largest company, Freeport-McMoran Copper & Gold Inc. (NYSE:FCX) is represented here, it is not necessarily the biggest mover because the index is price-weighted. Popular com- $65,308.8 Total Market Capitalization ($ million): Company Size by Market Capitalization: The smallest company is Star Buffet Inc. (NASD: STRZ) with a market capitalization of $2.9 million (Table 2). Arizona’s High-Tech, Manufacturing-Base 39 Average: $2,752.9 Largest: $47,900 Smallest: $2.9 Median: $698.2 Data Source: Yahoo Finance and EBR panies include PetSmart Inc. (NYSE:PETM) and US Airways Group Inc. (NYSE:LCC). The L&D Arizona 13 Sub-Index peaked on February 22nd, 2007 at a value of 111.90, representing an increase of nearly 12% since the base period of October 26, 2006. The date was selected as the base period in order to capture the effects of the latest recession and to provide the longest stock history for most companies in the index. The sub-index had peaked almost 4 months before the DJIA index and the S&P500 index (Graph 3 and 4). In hindsight, we know Arizona was one of the first states leading into the housing market crisis which later precipitated into a financial crisis and recession. At its peak, the sub-index performed better than the L&D Arizona Composite index and L&D Arizona Tech sub-indices. However, the Table 3: Company Breakdown by NAICS Industries Goods Producing 71% 21 Mining 23 Construction 31-33 Manufacturing 6% 12% 82% Service Providing 29% 22 Utilities 29% 42 Wholesale Trade 29% 44‐45 Retain Trade 14% 48‐49 Transportation and Warehousing 29% Data Source: Yahoo Finance and EBR www.ebr.eller.arizona.edu 9 Arizona’s Economy Graph 3: L&D Arizona 13 Sub-Index versus DJIA Index 120 16,000 14,000 100 12,000 80 10,000 8,000 60 6,000 40 4,000 20 2,000 0 DJIA Index Oct‐10 Jun‐10 Aug‐10 Apr‐10 Feb‐10 Oct‐09 Dec‐09 Jun‐09 Aug‐09 Apr‐09 Feb‐09 Oct‐08 Dec‐08 Jun‐08 Aug‐08 Apr‐08 Feb‐08 Oct‐07 Dec‐07 Jun‐07 Aug‐07 Apr‐07 Feb‐07 Oct‐06 0 Dec‐06 “The L&D Arizona Tech sub-index and the L&D Arizona Composite index went on to surpass the L&D Arizona 13 sub-index with more volatility and higher peaks later in the recession.” L&D Arizona 13 Sub‐Index Data Source: Yahoo Finance and EBR L&D Arizona Tech sub-index and the L&D Arizona Composite index went on to surpass the L&D Arizona 13 sub-index with more volatility and higher peaks later in the recession (Graph 5). The L&D Arizona Tech sub-index continued to thrive ten months after even after the L&D Arizona 13 sub-index began pricing in the housing market and financial crisis. L&D Arizona Tech Sub-Index A comparison of the performance of Arizona’s volatile technology stocks, as represented in the L&D Arizona Tech sub-index and the NASDAQ composite index suggests that, after riding at elevated levels throughout 2007 and into early 2008, the decline in stock prices was more rapid and severe for Arizona technology companies towards the end of 2008 (Graph 6). Despite this precipitous decline in value Arizona’s tech companies’ performance remain in step, today, with the NASDAQ composite. In general, the L&D Arizona Tech sub-index is more volatile than the NASDAQ Composite index, with higher up-swings and lower down -swings. The L&D Arizona Tech sub-index 10 peaked prior to the recession on December 28th, 2007 at 149.7, representing nearly a 25% increase in 14 months and close to a 50% increase from October 26, 2006, the base date selected for the index. The L&D Arizona Tech sub-index lags the NASDAQ Composite Index with the effect of the economic downturn being observed in the sub-index approximately 1 month after it registered in the NASDAQ Composite. Index Performance In order to compare the performance of the sub-indices with other market indices, the compound annual growth rate (CAGR) was calculated. The S&P Small Cap 600 was selected as the best benchmark to compare against the performance of the L&D Arizona Composite Index. This is because more than 75 percent of companies represented in the L&D Arizona index are small cap firms (market capitalization of < $2 billion). The CAGR calculations suggest that the L&D Arizona Composite Index, and even more so the L&D Arizona Tech sub-index out- Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Graph 4: L&D Arizona 13 Sub-Index versus S&P 500 Index 1,800 120 1,600 100 1,400 1,200 80 1,000 60 800 40 600 400 20 200 0 S&P500 Oct‐10 Jun‐10 Aug‐10 Apr‐10 Feb‐10 Oct‐09 Dec‐09 Jun‐09 Aug‐09 Apr‐09 Feb‐09 Oct‐08 Dec‐08 Jun‐08 Aug‐08 Apr‐08 Feb‐08 Oct‐07 Dec‐07 Jun‐07 Aug‐07 Apr‐07 Feb‐07 Oct‐06 Dec‐06 0 L&D Arizona 13 Sub‐Index Data Source: Yahoo Finance and EBR performed the benchmark of small-cap companies, the S&P Small Cap 600. The L&D Arizona Tech sub-index out-performed its benchmark of technology and growth companies, the NASDAQ Composite index. Small-cap, growth companies have generally led other companies out of a recession. This is evident in the L&D Arizona Tech sub-index and NASDAQ Composite Index which have performed better than other major indices over the last 4 years (Table 4). The L&D Arizona Tech Sub-Index, performed much better than the L&D Arizona Composite Index as well as the L&D Arizona 13 Sub-Index. On the same note, the NASDAQ Composite Index performed better than other major, large-cap market indices. “The L&D Arizona Tech sub-index outperformed its benchmark of technology and growth companies, the NASDAQ Composite index.” Table 4: Compound Annual Growth Rate Comparison L&D Market Indices Oct 2006 - Oct 2007 2007 - 2008 2007 - 2009 Oct 2006 - Oct 2010 14.5% -18.0% -3.6% 0.6% -15.5% -29.8% -9.2% -2.6% 41.9% -8.5% 1.0% 3.1% DJIA Index 4.6% -14.9% -5.3% -2.1% S&P 500 Index 2.2% -18.9% -7.2% -3.9% NASDAQ Composite 7.7% -17.9% -1.6% 1.2% -2.2% -17.4% -5.2% -1.3% L&D Arizona Composite Index L&D Arizona 13 Sub‐Index L&D Arizona Tech Sub‐Index Comparable Market Indices S&P Small Cap 600 Index Source: EBR www.ebr.eller.arizona.edu 11 Arizona’s Economy Graph 5: L&D Arizona Composite Index and Sub-Indices 160 140 120 “The L&D Arizona Composite index illuminates Arizona’s exceptional hightech cluster industries and the states strong manufacturingbase. “ 100 80 60 40 20 0 L&D Arizona Composite index L&D Arizona 13 Sub-Index L&D Arizona Tech Sub-Index Data Source: Yahoo Finance and EBR Graph 6: L&D Arizona Tech Sub-Index versus NASDAQ Composite Index 3,500 160 3,000 140 120 2,500 100 2,000 80 1,500 60 1,000 40 500 20 0 Economic and Business Research Center, Eller College of Management, The University of Arizona Oct‐10 Aug‐10 Jun‐10 Apr‐10 Feb‐10 Dec‐09 Oct‐09 Jun‐09 L&D Arizona Tech Sub‐Index Data Source: Yahoo Finance and EBR 12 Aug‐09 Apr‐09 Feb‐09 Oct‐08 Dec‐08 Jun‐08 NASDAQ Composite Aug‐08 Apr‐08 Feb‐08 Oct‐07 Dec‐07 Aug‐07 Jun‐07 Apr‐07 Feb‐07 Dec‐06 Oct‐06 0 January, 2011— Winter Issue Conclusion The L&D Arizona Composite index illuminates Arizona’s exceptional high-tech cluster industries and the states strong manufacturing-base. It is difficult to deny that Arizona’s unique location as a border state continues to provide a competitive edge to companies exporting inputs or final goods to Mexico, Arizona’s top export destination, or globally. Computer and electronic products, chemical and food manufacturing sectors do not only command the largest share in the L&D Arizona Composite index (75 percent), but were also among Arizona’s top 10 export categories in 2009. Export supporting industries in transportation and trade have also flourished as a result while mining, energy and solar continue to provide business opportunities in Arizona. As shown by the L&D Arizona Tech small-cap, growth companies continue to lead other companies out of the recession indicating the need to support small businesses at this critical time in order to drive employment. Notes: Compounded Annual Growth Rate (CAGR) Calculation CAGR(t0,tn) = (V(tn)/V(t0))^(1/( tn- t0))-1 Such that V(tn) = V(t0) x (1+CAGR)^n Where: V(tn) = end value, V(t0) = start value, and tn- t0 = number of years since the base date set in October 2006 “As shown by the L&D Arizona Tech small-cap, growth companies continue to lead other companies out of the recession indicating the need to support small businesses at this critical time in order to drive employment.” www.ebr.eller.arizona.edu 13 Forecast Tables Arizona Arizona’s Economy 2009 2010 2011 2012 2013 INCOME Personal Income ($mill) % change Per capita Personal Income ($) % change 219447.9 224632.7 233234.3 244821.1 259674.2 -2.1 2.4 3.8 5 6.1 33271 33652.5 34293.6 35235.7 36482.2 -3.6 1.1 1.9 2.7 3.5 69476 71048.6 75853.9 82942.1 89517.4 -10.7 2.3 6.8 9.3 7.9 11415.2 11630.7 12136.6 12756.7 13383.3 0.6 1.9 4.3 5.1 4.9 43358.9 43428.3 46510.8 51488.6 56050.1 SALES ($millions) Retail Sales (current dollars) % change Food Sales % change Retail Sales less Food % change Restaurant and Bar Sales % change -11.4 0.2 7.1 10.7 8.9 8886.7 9180 9786.3 10487.3 11202.4 -5.3 3.3 6.6 7.2 6.8 Gasoline Sales 6101.3 7095.5 7715.7 8520.9 9208.5 % change -27.1 16.3 8.7 10.4 8.1 2426.7 2396.9 2436.5 2517.8 2622.1 -7.3 -1.2 1.7 3.3 4.1 11.1 11 11.2 11.2 11.2 EMPLOYMENT (000s) Non Farm Employment % change Mining % change Construction -18 -0.6 1.9 -0.7 0 129.1 112.5 105.8 113.3 129.7 % change -30.7 -12.8 -6 7.1 14.4 Manufacturing 153.1 149.4 156.2 160.7 165.3 % change -11.6 -2.4 4.6 2.9 2.9 479.5 472.9 481.9 498.4 515.5 -7.2 -1.4 1.9 3.4 3.4 39.2 37.6 38.1 40.5 42.2 -6.6 -4.2 1.3 6.5 4.1 387.6 Trade, Transportation & Utilities % change Information % change Professional & Business Services % change Leisure & Hospitality % change Goverment % change 346 345.9 355.4 368.8 -10.4 0 2.7 3.8 5.1 255.4 253.6 258.2 266.1 275.2 -5.5 -0.7 1.8 3 3.4 422.6 414.3 407.8 410 417.2 -2.3 -2 -1.6 0.5 1.7 6595.8 6675.1 6801.1 6948.1 7117.8 1.5 1.2 1.9 2.2 2.4 OTHER INDICATORS Population (000s) % change Unemployment Rate, percent Residential Permits (units) 9.1 9.6 9.5 8.7 8.1 14271 13024 23959.4 34358 46900.9 % change -42.7 -8.7 84 43.4 36.5 Single family 12835 11635.9 20504.9 31062.3 41790.9 % change -27.6 -9.3 76.2 51.5 34.5 Multi‐family 1436 1388.1 3454.6 3295.7 5110.1 % change Gasoline Sales (mill of gals) % change Civilian Nonag Wage Rate % change 14 -80 -3.3 148.9 -4.6 55.1 2640.6 2631.3 2708.4 2834 2976.7 -2.7 -0.4 2.9 4.6 5 45498.1 46313.2 47471.7 48559.6 49758.8 1.1 1.8 2.5 2.3 2.5 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Phoenix‐Mesa MSA 2009 2010 Forecast Tables 2011 2012 2013 INCOME Personal Income ($mill) 149611 152259.1 157672.6 165254.1 -3.5 1.8 3.6 4.8 6.4 34282 34479 35120 36063 37467 -5.2 0.6 1.9 2.7 3.9 46922.6 48892.4 53008.8 58597.4 63449.9 -12.3 4.2 8.4 10.5 8.3 6825.5 7683.3 8006.9 8335.2 8738 -10.1 12.6 4.2 4.1 4.8 30146.3 30332.5 33333.6 37684.4 41334.1 -11.3 0.6 9.9 13.1 9.7 6176.9 6434.9 6859.6 7326.5 7825.8 -5.8 4.2 6.6 6.8 6.8 Gasoline Sales 3773.9 4441.7 4808.7 5251.2 5552 % change -30.1 17.7 8.3 9.2 5.7 1720.4 1695.6 1722.4 1779.5 1855.4 -7.8 -1.4 1.6 3.3 4.3 3 3 3.2 3.3 3.5 5.7 % change Per capita Personal Income ($) % change 175799.7 SALES ($millions) Retail Sales (current dollars) % change Food Sales % change Retail Sales less Food % change Restaurant and Bar Sales % change EMPLOYMENT (000s) Non Farm Employment % change Mining % change -20.7 0.4 6 3 96.2 81.1 70.2 75 89 -31 -15.7 -13.4 6.8 18.7 Manufacturing 113.9 112.6 118.7 121.9 125.3 % change -12.2 -1.1 5.3 2.8 2.7 382 Construction % change Trade, Transportation & Utilities 356 352.1 358.7 369.8 % change -7.2 -1.1 1.9 3.1 3.3 Information 29 27.4 28.3 29.1 29.2 % change -6.8 -5.7 3.5 2.6 0.4 275.6 273.7 281.9 293 305.8 -11 -0.7 3 3.9 4.3 174.1 172 175.9 181.6 187.9 -5.7 -1.2 2.3 3.2 3.5 239.1 234 229.9 232.2 237 -2.8 -2.1 -1.8 1 2.1 4364.1 4416 4489.6 4582.3 4692.1 1.8 1.2 1.7 2.1 2.4 29968 Professional & Business Services % change Leisure & Hospitality % change Goverment % change OTHER INDICATORS Population (000s) % change Residential Permits (units) 9272 8570 13613 21649 % change -50 -7.6 58.8 59 38.4 Single family 8598 7593 12080 19433 26676 % change -32.1 -11.7 59.1 60.9 37.3 Multi‐family 674 977 1533 2216 3292 % change Gasoline Sales (mill of gals) % change Unleaded Gasoline Price, PHX ($) % change Aggregate Earnings Rate % change -88.5 45 56.9 44.5 48.6 1637.2 1643.7 1686.4 1742.1 1794.3 -5.7 0.4 2.6 3.3 3 2.31 2.7 2.85 3.01 3.09 -25.9 17.2 5.5 5.7 2.7 49680.3 50608.5 51742.2 52824.1 54061 0.6 1.9 2.2 2.1 2.3 www.ebr.eller.arizona.edu 15 Forecast Tables Tucson MSA Arizona’s Economy 2009 2010 2011 2012 2013 INCOME Personal Income ($mill) % change Per capita Personal Income ($) % change 33930.3 34873.9 36191.5 37876.6 -1.3 2.8 3.8 4.7 40124 5.9 33258.5 33753 34431.2 35276.4 36555 -2.3 1.5 2 2.5 3.6 10397.2 10815.6 11587.3 12413.8 13187.8 -9.4 4 7.1 7.1 6.2 1621.2 1874.8 1958 2035.3 2124.7 -10 15.6 4.4 3.9 4.4 6544.3 6473.2 7005.6 7583.3 8124.8 SALES ($millions) Retail Sales (current dollars) % change Food Sales % change Retail Sales less Food % change Restaurant and Bar Sales -8.3 -1.1 8.2 8.2 7.1 1362.9 1416.1 1510.7 1615 1720.9 % change -4.1 3.9 6.7 6.9 6.6 Gasoline Sales 868.7 1051.5 1113 1180.2 1217.5 % change -22.4 21 5.8 6 3.2 361.7 357.7 362.3 373.2 386.1 -5.2 -1.1 1.3 3 3.5 1.7 1.8 1.7 1.7 1.7 -10.8 1.9 -2 -0.3 0.4 EMPLOYMENT (000s) Non Farm Employment % change Mining % change Construction 16.6 14.6 14.5 16.5 19.2 % change -27 -12.1 -0.5 13.3 16.6 Manufacturing 25.2 24.5 25.2 25.9 26.7 % change -7.4 -2.8 2.9 3 2.8 58 57.2 58.4 60.1 62.1 -7.5 -1.3 2 3.1 3.2 4.8 4.6 4.7 4.9 4.9 -9.4 -4.1 3.7 2.6 0.4 47.3 47.5 46.7 47.8 49.8 -7.9 0.4 -1.8 2.4 4.2 38.7 38 39.4 40.9 42.3 Trade, Transportation & Utilities % change Information % change Professional & Business Services % change Leisure & Hospitality % change -4.2 -1.9 3.8 3.8 3.3 Government 78.9 77.4 77.3 78.1 79.1 % change -1.2 -1.9 -0.1 1.1 1.3 1020.2 1033.2 1051.1 1073.7 1097.6 1 1.3 1.7 2.1 2.2 2129 2275.8 4055.8 6003.3 6739.7 OTHER INDICATORS Population (000s) % change Residential Permits (units) % change -33.9 6.9 78.2 48 12.3 Single family 1934 1912.5 3548.7 5397.2 6059.3 % change -29.5 -1.1 85.6 52.1 12.3 Multi‐family 195 363.3 507.1 606.1 680.5 % change Gasoline Sales (mill of gals) % change Unleaded Gasoline Price, PHX ($) % change Aggregate Earnings Rate % change 16 -59.2 86.3 39.6 19.5 12.3 376.9 389.1 390.3 391.5 393.5 4.7 3.2 0.3 0.3 0.5 2.3 2.7 2.9 3 3.1 -25.9 17.2 5.5 5.7 2.7 41966.7 42587 43721.4 44708.1 45858.6 -0.4 1.5 2.7 2.3 2.6 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Arizona Economic Indicators Arizona Monthly Data Civilian Labor Force (000s), ADOC & EBR Employment Unemployment Unemployment Rate, Seas. Adj. (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. Avg. 3,173.90 3,180.50 3,189.10 3,205.20 3,181.30 1.1 0.7 2,863.30 2,861.90 2,870.30 2,895.80 2,886.40 1.3 -0.1 310.6 318.6 318.8 309.4 294.9 -0.8 8.8 9.6 9.6 9.7 9.7 9.5 2.2 8.6 2,354.10 2,339.50 2,376.80 2,394.00 2,421.30 0.9 -2.6 Employees on Nonagricultural Payrolls (000s), ADOC & EBR Total Natural Resources and Mining 11 11.1 11.2 11.4 11.5 6.8 -6.7 Construction 113.9 113.8 115.3 115.4 120.5 0.7 -16.7 Durable Goods Manufacturing 117.8 117.8 117.6 116.4 116.5 -0.3 -5.7 Fabricated Metal Products 15.5 15.5 15.5 15.4 15.3 11.8 2.2 Computer and Electronic Prod. 37.1 37 37.2 36.9 36.9 2.4 -3 Aerospace Products and Parts 26.9 26.8 26.7 26.5 26.4 -11.3 -9.3 31.9 31.4 30.3 30.7 30.8 -2.4 -3.3 Non‐Durable Goods Manufacturing Wholesale Trade 96.3 95.9 95.7 95.2 96.8 -1.5 -4.7 291.5 291.4 292.7 293.3 298.2 2.1 -1.8 Utilities 12.2 12.2 12.2 12.1 12.2 -0.5 -2.3 Transportation and Warehousing 67.1 67.3 67.4 67.6 67.9 1 -4.5 Information 37.9 37.7 37.4 37.2 36.9 -2 -5 118.3 118.1 117.7 118.2 118.9 -0.6 -1.9 Retail Trade Finance and Insurance Real Estate, Rental, and Leasing Professional and Business Services Educational Services Health Care and Social Assistance Arts, Entertainment, and Recreation Accommodation Food Svcs and Drinking Places Other Services 44.8 44.9 44.9 45.7 45.6 0.4 -3.6 340.9 343.3 346.7 349 350.7 2.5 -2.3 50.1 50 52.5 55.2 57.7 12.7 10 287.1 286.8 289.4 290.5 294.6 3.8 2.7 31.9 31.2 29.8 31.6 32.7 2.2 -3.1 44.6 43.7 42.6 42 42.9 0.7 -3.8 177.2 172.7 175.2 173 174.2 -0.4 -1.6 -2.7 94 95.2 93.8 91.2 92.7 -0.8 63.1 62 58.8 56.3 56 -1.9 4.7 322.5 312.8 345.5 361.8 363.9 -2 -3.2 State and Local Government Education 155.3 145.7 180.2 197.9 200.7 -0.8 -2.1 Hours Worked Per Week, Manufacturing, ADOC & EBR 39.4 39.9 39.7 40.3 40.2 3.9 1.2 Construction 19.49 19.47 19.1 19.28 19.17 -3.4 0.4 Manufacturing 17.03 16.96 17.01 16.75 16.8 -1.5 0.4 Trade, Transportation, Utilities 16.26 15.92 16.07 16.23 16.17 2.8 4.5 Retail Trade 13.81 13.56 13.64 13.93 13.92 2.7 4.1 23 22.53 22.88 22.53 22.43 3.8 6.7 Federal Government State and Local Government Average Hourly Earnings ($) ADOC & EBR Wholesale Trade Arizona monthly data continued next page… All sources and abbreviations on page 17. www.ebr.eller.arizona.edu 17 Arizona’s Economy Arizona ‐ Monthly , continued... Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. average Sales ($000s), ADOR Aggregate Retail Sales 5,804,579 5,464,207 5,689,089 5,736,482 ... 4.9 1.5 3,572,613 3,275,200 3,457,126 3,537,883 ... 6.2 -0.6 Food, EBR 957,991 917,787 915,621 936,369 ... 1.8 0.9 Restaurants & Bars 711,223 676,280 701,863 700,953 ... 2.1 1.2 Gasoline, EBR 562,751 594,941 614,480 561,277 ... 5.9 19.1 210,916 223,188 224,509 212,524 ... 0.1 -0.9 Utilities 825,095 1,034,128 1,054,620 991,490 ... 3.1 0.6 Communications 267,221 253,446 234,825 266,888 ... 1.3 -3.7 73,514 79,557 56,263 ... ... -18 0 Rentals ‐ Personal Property 250,973 238,378 246,969 240,248 ... Contracting 787,275 723,697 742,250 757,746 ... -7.8 -29.8 Mining ‐ Metal, Oil & Gas 101,775 100,093 93,491 113,419 ... -79.2 18.2 Hotel/Motel 143,992 123,186 128,707 ... ... 6.9 -3.4 Retail Gallons (000s) ADOT Amusements New Housing Units Authorized, Census C‐40 Total Units 1,086 906 947 1,046 846 -22 -0.5 Single Family Units 978 846 868 759 721 -32.9 -1.7 2‐4 Unit Structures 36 26 5 0 31 520 81 5‐plus Unit Structures 72 34 74 287 94 ... ... 3,585 3,526 3,769 3,763 3,555 6.4 30.4 2,988 2,916 3,094 3,024 2,905 6.9 30.6 Bankruptcy Filings, U.S. Bankruptcy Court Total Chapter 7 Chapter 11 41 63 58 53 50 0 22.4 Chapter 13 556 547 616 686 600 4.5 30 Arizona ‐ Quarterly 09 II 09 III 09 IV 10 I % change vs. year ago for most recent: 10 II quarter 4‐QTR average Demographics & Vital Statistics (000s, seas adj) ADHS & EBR Population 6,583.70 6,604.20 6,621.40 6,640.30 6,662.80 1.3 1.3 12.1 11.4 11.2 10.9 10.8 -9.8 -13.3 Births 23.3 22.8 22.5 22.4 22 -6.6 -6.5 Deaths 11.2 11.5 11.3 11.5 11.1 -3.5 1.2 12 5.5 6.3 9.4 13.8 217 19.2 220,136 218,510 219,993 220,767 223,784 3.3 1.2 152,222 150,956 151,734 151,077 153,015 2.4 -0.6 17,122 16,998 17,062 17,120 17,294 2.5 0.1 718 712 716 713 721 2.2 -0.1 Plus: Dividends, Interest & Rents 40,118 39,418 39,437 39,667 39,983 1.1 -2.7 Plus: Transfer Payments 44,200 44,421 45,168 46,430 47,358 8.3 11.1 -1.3 Natural Increase Net Migration Personal Income Derivation ($mil, SAAR) BEA & EBR Total Personal Income Earnings by Place of Work Less: Contributions for Social Insurance Plus: Adjustment for Residence Components of Earnings ($mil, SAAR) BEA & EBR Wages and Salaries 110,721 109,538 109,859 109,215 110,578 1.9 Other Labor Income EBR 26,021 25,854 25,992 25,956 26,198 2.2 0.6 Proprietor's Income 15,527 15,764 15,950 15,923 16,220 4.5 -1.2 N/A Farm -94 -19 -27 -39 -51 45.7 15,621 15,783 15,976 15,962 16,271 4.2 -1 Per Capita Personal Income ($, SAAR) EBR 33,436 33,087 33,225 33,246 33,587 2 -0.1 Average Wage Per Employee, Annual Rate ($) EBR 45,491 45,684 46,081 45,856 46,121 1.8 2 Nonfarm 18 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Travel and Tourism ‐ Monthly Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. avg. Visits to Parks & Other Recreational Areas, NPS & ASPB Northern Arizona 2,136,099 2,267,033 2,219,124 1,756,516 1,296,230 -13.2 -0.3 Historical 133,227 137,006 122,543 127,650 119,408 -4.7 -2.4 Scenic 798,790 886,655 831,393 657,413 485,600 -3.0 1.6 1,204,082 1,243,372 1,265,188 971,453 691,222 -20.3 -1.2 140,848 159,056 117,533 137,678 192,934 8.6 -5.1 Historical 23,244 24,644 23,108 26,902 33,034 15.2 5.9 Scenic 77,276 93,432 70,353 82,662 131,001 15.8 -4.5 Water Based Recreation 40,328 40,980 24,072 28,114 28,899 -19.6 -16.9 1,284,438 1,305,542 1,254,599 1,225,475 ... -11.2 -12.4 Pedestrians 528,141 599,288 631,537 559,782 ... -7.3 -6.0 Vehicles 579,727 577,987 559,139 548,153 ... -9.8 -8.5 Water Based Recreation Southern Arizona International Border Crossings, USBCBP Passengers Inflation and Prices ‐ Monthly Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. avg. Consumer Price Index (1982‐1984=100) BLS U.S. ‐ All Urban 218.0 218.0 218.3 218.4 218.7 1.2 1.8 U.S. ‐ Wage Earners 213.8 213.9 214.2 214.3 214.6 1.5 2.3 Inflation and Prices ‐ Quarterly 09 II 09 III 09 IV 10 I % change vs. year ago for most recent: 10 II quarter 4 –QTR avg. Consumer Price index (1982‐84=100) BLS Western Region (U.S.) 218.78 219.89 219.83 220.33 221.26 1.1 0.6 U.S. ‐ All Urban Consumers 214.3 215.7 216.2 217 218.1 1.8 1 U.S. ‐ Urban Wage Earners 209.2 211 211.8 212.9 214 2.3 1.2 Gross Domestic Product 109.6 109.8 109.7 110 110.5 0.8 0.5 Personal Consumption Expenditures 108.8 109.6 110.3 110.9 110.9 1.9 1.3 Price Indexes (2000=100) BEA SOURCES AND ABBREVIATIONS: ADES: Arizona Department of Economic Security ADHS: Arizona Department of Health Services ADOC: Arizona Department of Commerce ADOR: Arizona Department of Revenue ADOT: Arizona Department of Transporta on ARMLS: Arizona Regional Mul ple Lis ng Service ASPB: Arizona State Parks Board BEA: Bureau of Economic Analysis, U.S. Department of Commerce BLS: Bureau of Labor Sta s cs, U.S. Department of Labor Census C‐40: U.S. Census Bureau, U.S. Department of Commerce EBR: Economic & Business Research Center, The University of Arizona NPS: Na onal Park Service, U.S. Department of the Interior PSHIA: Phoenix Sky Harbor Interna onal Airport SAAR: Seasonally adjusted at annual rates TAA: Tucson Airport Authority * All Aggregate Retail Sales figures reported by EBR include retail, food, restaurant & bars and gasoline sales. Source: Economic and Business Research Center, Eller College of Management, The University of Arizona www.ebr.eller.arizona.edu 19 Arizona’s Economy Phoenix‐Mesa MSA ‐ Monthly Civilian Labor Force (000s), ADOC & EBR Employment Unemployment Unemployment Rate, Seas. Adj. (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 2,125.00 2,126.90 2,131.90 2,147.70 2,132.30 1.4 0.7 1,933.60 1,932.40 1,937.70 1,957.10 1,951.50 1.8 0 191.4 194.5 194.2 190.6 180.8 -3.2 8.2 8.7 8.8 8.8 8.7 8.5 -3.4 7.2 1,670.10 1,657.60 1,686.00 1,698.80 1,721.00 1.2 -2.6 3 3 3 3 3 4.9 -7.1 Employees on Nonagricultural Payrolls (000s), ADOC & EBR Total Natural Resources and Mining Construction 85 85 86.2 86.8 90.9 2.2 -16.7 86.6 86.2 86.3 85.6 85.5 -0.5 -6.1 Computer and Electronic Prod. 34.2 34.1 34.4 34.2 34.3 4.4 -1.4 Aerospace Products and Parts 14.2 14.1 14 13.8 13.7 -18.5 -16 Non‐Durable Goods 24.3 24.1 23.3 23.3 23.3 -4.8 -3.9 Wholesale Trade 80.9 80.6 80.1 79.5 81.2 -2.4 -4.5 205.7 206 208 208.5 212.6 3.4 -1.2 -2.8 Durable Goods Retail Trade Utilities 8.5 8.5 8.5 8.4 8.5 -0.9 Transportation and Warehousing 52 52.2 52.6 52.5 52.8 0.3 -5 Information 28.1 27.7 27.5 27.3 27 -3 -5.7 Finance and Insurance 101 101.4 101.1 101.7 101.8 -0.8 -2.7 35 34.8 34.7 35.3 35.3 0.9 -3.1 271.6 273.3 276.5 278.5 279.8 2.6 -2.6 12.3 Real Estate, Rental, and Leasing Professional and Business Services Educational Services 40.5 40.2 42.4 43.7 45.3 12.4 Health Care and Social Assistance 191 190.5 192.8 194.3 197.3 4.6 3.3 Arts, Entertainment, and Recreation 23.8 23 21.5 22.6 23.2 -0.7 -3.2 -5 Accommodation Food Svcs and Drinking Places Other Services Federal Government 27 26.2 25.7 25.1 25.7 -0.7 122.2 119.2 121.6 120.3 121.7 1.8 -1 69 70.3 69.2 67.2 68.4 0 -2.3 25.3 25 23.1 22.1 22 -4.3 3.1 189.6 180.5 202.1 213.4 215.8 -2.3 -2.9 90.1 81.7 104.1 116.1 118 -1.3 -1.2 3,926,157 3,654,111 3,808,402 3,905,295 ... 7.9 2.4 2,466,448 2,245,030 2,355,746 2,459,581 ... 8.1 0 Food, EBR 632,853 606,293 604,863 618,569 ... 12.5 5.6 Restaurants & Bars 485,496 450,582 473,160 481,848 ... 2.5 1.8 Gasoline, EBR 341,361 352,206 374,634 345,298 ... 6.2 17.4 Contracting 507,563 501,639 451,750 497,846 ... -9.6 -31.2 Hotel/Motel 70,769 51,348 58,687 70,696 ... 4.4 -3.3 707 585 635 585 604 -20.2 -0.1 Single Family Units 668 549 586 494 503 -33.3 0.5 2‐4 Unit Structures 0 16 0 0 31 … … 39 20 49 91 70 ... … 1,539,666 1,249,582 1,106,146 1,080,460 1,076,571 -22 1.9 8,173 7,101 6,487 6,762 6,591 -18.8 0.3 188,384 175,973 170,517 159,784 163,340 -4 0.4 ... 2.5 1.8 ... -1 -2.4 State and Local Government State and Local Government Education Sales ($000s), ADOR Aggregate Retail Sales Retail New Housing Units Authorized, Census C‐40 Total Units 5‐plus Unit Structures Housing Sales and Prices, ARMLS Total Sales ($000s) Total Units Average Price ($) Phoenix Skyharbor International Airport, PSIA 3,303,007 3,319,701 3,132,493 2,908,336 Total Passengers 20 Economic and Business Research Center, Eller College of Management, The University of35,621 Arizona 36,740 37,641 37,009 Total Aircraft Movements January, 2011— Winter Issue Phoenix‐Mesa MSA ‐ Quarterly 09 II 09 III 09 IV 10 I % change vs. year ago for most recent 10 II quarter 4 –QTR avg. Demographics & Vital Statistics (000s, seas adj) ADHS & EBR Population 4355.0 4369.3 4382.9 4396.2 4409.4 1.2 1.4 10.1 10.0 9.9 9.9 9.8 -2.8 -5.1 Births 16.5 16.3 16.2 16.2 16.0 -2.9 -4.7 Deaths 6.4 6.3 6.3 6.3 6.2 -2.9 -4.1 6.2 4.3 3.7 3.4 3.3 -46.0 -62.0 149,154 149,091 150,163 151,266 151,928 1.9 -0.7 109,648 109,051 109,612 110,199 110,339 0.6 -2.9 12,105 12,019 12,055 12,097 12,091 -0.1 -3.2 -5.5 Natural Increase Net Migration Personal Income by Source ($mil, SAAR) EBR Total Personal Income Earnings by Place of Work Less: Contributions for Social Insurance Plus: Adjustment for Residence -181 -185 -186 -187 -189 -4.4 Plus: Dividends, Interest & Rents 26,904 26,789 26,947 27,116 27,177 1.0 -2.2 Plus: Transfer Payments 24,889 25,454 25,844 26,235 26,692 7.2 10.4 34,249 34,122 34,261 34,408 34,456 0.6 -2.1 Per Capita Personal Income ($, SAAR) EBR Apache County Civilian Labor Force, ADOC & EBR Employment Unemployment Unemployment Rate (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent month 12‐mo. average Oct 10 23,650 23,750 23,750 22,950 22,425 -2.9 1.4 19,725 19,675 19,850 19,375 18,900 -3.7 -0.4 3,925 4,075 3,900 3,575 3,525 1.4 12.0 15.7 14.5 15.9 16.3 16.1 3.7 10.7 19,675 19,600 20,000 19,400 19,050 -4.8 -2.2 Employees on Nonagricultural Payrolls, ADOC & EBR Total Total Private 7,025 7,050 7,075 7,075 7,075 -3.7 -4.5 Goods‐Producing 575 625 625 625 625 -7.4 -23.3 Service‐Providing 19,100 18,975 19,375 18,775 18,425 -4.7 -1.3 2,025 2,025 2,000 2,075 2,050 -2.4 -2.4 Trade, Transportation, and Utilities Other Private Service‐Providing 4,425 4,400 4,450 4,375 4,400 -3.8 -2.2 12,650 12,550 12,925 12,325 11,975 -5.3 -0.9 Federal Government 3,600 3,225 3,375 2,975 2,950 -14.5 0.9 State and Local Government 9,050 9,325 9,550 9,350 9,025 -1.9 -1.5 14,728 -4,312 14,394 14,135 ... -1.5 -27.2 Retail 7,047 -12,642 6,620 6,385 ... -12.3 -55.0 Restaurants & Bars 1,400 1,635 1,223 1,299 ... 10.8 0.1 Gasoline, EBR 6,281 6,695 6,550 6,451 ... 9.4 10.9 2,354 2,512 2,393 2,442 ... 3.4 -6.8 Contracting 5,691 6,474 13,533 6,520 ... -0.5 -8.1 Hotel/Motel 1,316 1,506 1,621 1,181 ... -18.2 -15.3 Government Sales ($000s), ADOR Gross Retail Gallons (000s) ADOT www.ebr.eller.arizona.edu 21 Arizona’s Economy Tucson MSA ‐ Monthly Civilian Labor Force (000s), ADOC & EBR Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 488.5 490.7 494.7 497 492.2 0.2 444.3 445.5 450.2 453.4 451.1 0.5 0 44.2 45.2 44.5 43.6 41.1 -3.1 8.1 8.6 8.7 8.7 8.6 8.3 -2.4 6.6 346 345.1 352.6 355.3 358 -0.4 -2.6 1.8 1.8 1.8 1.8 1.8 6.7 0.8 Construction 15.1 14.9 15.2 15.1 15.5 -1.7 -13.8 Manufacturing 24.4 24.5 24.2 24.1 24 -3.1 -4.5 12.4 12.3 12.2 12.1 12.1 -4 -0.6 8.1 8.1 8.1 8.1 8.1 -3.2 -7 39.5 39.3 39.2 39.4 39.7 0.3 -3.1 Transp., Warehousing, and Utilities 8.5 8.5 8.4 8.5 8.6 -0.6 -4.5 Information 4.6 4.6 4.6 4.6 4.5 -0.8 -6 Financial Activities 17.7 17.7 17.7 17.9 17.9 1.2 2.8 Professional and Business Services 45.5 45.7 45.9 46 46.5 -1 -3.1 Educational and Health Services 58.9 59.2 59.5 59.8 60.7 3.7 1.1 Arts, Entertainment, and Recreation 4.3 4.1 3.7 3.9 4.1 -10.5 -6.9 Accommodation 6.5 6.4 6.3 6.1 6.2 -0.4 -1.1 Food Svcs and Drinking Places 27 26.4 26.8 27.1 27.2 -0.4 -2.6 Other Services 14.5 14.4 14.3 14 14.1 -3.2 -3.5 Federal Government 13.3 13 12.5 12.1 12.1 0.8 7.1 State and Local Government 56.3 56.6 64.5 66.8 67 -1.6 -3.5 31.8 32.2 40.3 43.2 43.6 0.9 -2 Employment Unemployment Unemployment Rate, Seas. Adj. (%) 0.7 Employees on Nonagricultural Payrolls (000s), ADOC & EBR Total Natural Resources and Mining Aerospace Products and Parts Wholesale Trade Retail Trade State and Local Government Education Sales ($000s), ADOR Aggregate Retail Sales 860,243 822,940 883,542 846,893 ... 4.3 3.2 Retail 519,660 487,625 535,298 505,331 ... 1.8 -0.3 Food, EBR 154,424 147,943 147,594 150,939 ... 15.6 7.9 Restaurants & Bars 105,155 104,164 111,457 107,919 ... 1.2 1.1 81,004 83,208 89,193 82,704 ... 6.1 24.9 Contracting 122,992 73,814 144,436 115,428 ... 5.5 -23.2 Hotel/Motel 17,771 15,760 15,337 17,485 ... 4.9 0.7 188 159 192 334 124 -29.5 13.8 168 145 162 149 109 -37.4 0.9 20 14 30 185 15 650 278.9 221,401 152,121 164,547 158,547 133,204 -35.8 -2.5 1,170 792 882 873 752 -29.3 3.2 189,231 192,072 186,562 181,612 177,133 -9.3 -5.9 300,545 303,736 284,087 279,624 332,541 5.3 2.1 13,334 13,047 14,014 12,057 12,706 -16.7 -8.2 Gasoline, EBR New Housing Units Authorized, Census C‐40 Total Units Single Family Units 2‐5‐plus Unit Structures Housing Sales and Prices, TAR Total Sales ($000s) Total Units Average Price ($) Tucson International Airport, TAA Total Passengers Total Aircraft Movements 22 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Tucson MSA ‐ Quarterly 09 III 09 IV 10 I 10 II % change vs. year ago for most recent 10 III quarter 4 –QTR avg. Demographics & Vital Statistics (000s, seas adj) ADHS & EBR Population 1018.8 1021.9 1025.1 1028.3 1031.6 1.3 1.4 1.4 1.4 1.4 1.4 3.6 0.9 Births 3.3 3.3 3.3 3.3 3.4 1.2 -1.0 Deaths 2.0 1.9 1.9 1.9 1.9 -0.5 -2.3 1.5 1.7 1.9 1.9 1.8 25.7 43.7 33,790 33,878 34,193 34,520 34,756 2.9 0.8 20,845 20,740 20,830 20,934 20,958 0.5 -2.1 2,399 2,391 2,404 2,418 2,424 1.1 -1.2 201 200 200 201 201 0.0 -0.1 Plus: Dividends, Interest & Rents 7,484 7,462 7,536 7,613 7,653 2.3 -2.0 Plus: Transfer Payments 7,660 7,867 8,030 8,191 8,369 9.3 11.9 33,168 33,153 33,355 33,569 33,692 1.6 -0.4 Natural Increase Net Migration 1.2 Personal Income by Source ($mil, SAAR) EBR Total Personal Income Earnings by Place of Work Less: Contributions for Social Insurance Plus: Adjustment for Residence Per Capita Personal Income ($, SAAR) EBR Cochise County Civilian Labor Force, ADOC & EBR Employment Unemployment Unemployment Rate (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 64,350 64,550 64,225 64,425 63,550 0.0 59,000 59,000 58,800 59,100 58,550 -0.5 0.9 0.1 5,350 5,550 5,425 5,325 5,000 6.4 11.1 8.1 8.2 8.3 8.3 8.1 6.5 10.1 Employees on Nonagricultural Payrolls, ADOC & EBR Total 36,900 36,800 37,025 37,125 37,100 -1.4 -1.8 Total Private 24,675 24,625 24,600 24,575 24,500 -2.0 -2.6 Goods‐Producing 2,125 2,125 2,125 2,150 2,150 -6.5 -8.5 Mining and Construction 1,525 1,525 1,525 1,550 1,550 -3.1 -7.0 Manufacturing 600 600 600 600 600 -14.3 -12.0 Service‐Providing 34,775 34,675 34,900 34,975 34,950 -1.1 -1.3 0.5 Trade, Transportation, and Utilities 6,425 6,450 6,350 6,325 6,375 2.0 Information 650 650 700 700 700 3.7 1.9 Financial Activities 925 925 900 900 925 -5.1 -4.8 Professional and Business Services 5,700 5,700 5,625 5,550 5,375 -5.3 -3.5 Educational and Health Services 4,325 4,325 4,350 4,400 4,400 1.7 0.8 Leisure and Hospitality 3,675 3,600 3,700 3,700 3,725 -5.1 -6.0 850 850 850 850 850 -2.9 -6.2 12,225 12,175 12,425 12,550 12,600 -0.2 0.0 Federal Government 5,450 5,525 5,475 5,625 5,650 7.1 4.3 State and Local Government 6,775 6,650 6,950 6,925 6,950 -5.4 -3.1 Other Services Government Sales ($000), ADOR Gross Retail 83,892 79,692 78,319 78,790 ... 4.0 1.9 Retail 62,195 56,510 55,475 57,160 ... 3.2 -1.8 Restaurants & Bars 10,151 10,870 9,966 10,415 ... 9.7 3.5 Gasoline, EBR 11,546 12,312 12,878 11,215 ... 3.2 23.0 Gallons (000s) ADOT 4,328 4,619 4,705 4,246 ... -2.5 2.7 Contracting 25,045 24,224 16,270 13,024 ... -43.1 -5.4 Hotel/Motel 3,279 3,783 4,010 3,750 ... 10.9 5.0 49 37 23 37 36 37 23 26 New Housing Units Authorized, Census C‐40 Total Units Single Family Units 36 9.1 27 -18.2 www.ebr.eller.arizona.edu 23 64.0 16.5 Arizona’s Economy Coconino County Civilian Labor Force, ADOC & EBR Employment Unemployment Unemployment Rate (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. average 78,500 78,000 77,700 78,300 77,900 2.2 2.1 71,600 71,500 71,400 72,300 72,100 2.7 1.0 6,900 6,500 6,300 6,000 5,800 -3.3 15.7 8.7 7.9 8.2 8.2 8.1 -5.5 13.4 -1.0 Employees on Nonagricultural Payrolls, ADOC & EBR Total 62,500 62,100 62,700 63,400 63,900 2.1 Total Private 43,600 43,600 43,600 43,600 44,000 2.3 1.0 Goods‐Producing 5,400 5,400 5,500 5,400 5,500 -3.5 -11.0 Mining and Construction 1,500 1,500 1,600 1,500 1,600 -20.0 -29.9 Manufacturing 3,900 3,900 3,900 3,900 3,900 5.4 0.4 Service‐Providing 57,100 56,700 57,200 58,000 58,400 2.6 0.1 9,900 9,900 9,900 9,900 10,100 3.1 2.3 400 300 300 300 300 -25.0 -14.6 Financial Activities 1,400 1,400 1,400 1,400 1,400 0.0 -3.5 Professional and Business Services 2,600 2,600 2,600 2,600 2,600 -3.7 -7.3 Educational and Health Services 7,900 7,900 8,000 8,100 8,100 2.5 2.8 14,000 14,100 13,900 13,900 14,000 6.9 7.8 2,000 2,000 2,000 2,000 2,000 0.0 -0.4 18,900 18,500 19,100 19,800 19,900 1.5 -5.1 3,700 3,500 3,500 3,100 3,000 0.0 4.1 15,200 15,000 15,600 16,700 16,900 1.8 -6.7 147,700 150,624 146,839 138,979 ... 1.2 1.5 Retail 90,251 84,799 87,322 87,481 ... 1.1 -1.8 Restaurants & Bars 33,205 33,311 33,808 29,337 ... -3.5 -0.8 Gasoline, EBR 24,245 32,514 25,709 22,161 ... 8.4 20.7 9,087 12,197 9,393 8,391 ... 2.5 2.0 Contracting 25,525 29,254 27,019 31,533 ... 19.3 -14.8 Hotel/Motel 29,219 29,241 29,008 26,858 ... 5.5 2.2 20 22 10 8 15 -6.3 -52.6 20 22 10 8 15 -6.3 11.5 Trade, Transportation, and Utilities Information Leisure and Hospitality Other Services Government Federal Government State and Local Government Sales ($000s), ADOR Gross Retail Gallons (000s) ADOT New Housing Units Authorized, Census C‐40 Total Units Single Family Units 24 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Gila County Civilian Labor Force, ADOC & EBR Employment Unemployment Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. average 23,525 23,575 23,475 23,300 22,700 -1.2 -0.8 21,000 21,000 20,900 20,750 20,225 -1.3 -1.8 2,525 2,575 2,575 2,550 2,475 0.0 8.2 10.5 10.6 11.1 11.1 11.1 1.4 9.2 Unemployment Rate (%) Employees on Nonagricultural Payrolls, ADOC & EBR Total 13,825 13,800 13,850 13,725 13,450 -2.4 -3.8 Total Private 8,825 8,875 8,800 8,750 8,625 -2.3 -5.1 Goods‐Producing 2,250 2,250 2,250 2,225 2,200 -3.3 -9.2 Service‐Providing 11,575 11,550 11,600 11,500 11,250 -2.2 -2.7 Trade, Transportation, and Utilities 2,300 2,300 2,225 2,250 2,225 -1.1 -3.4 Other Private Service‐Providing 4,275 4,325 4,325 4,275 4,200 -2.3 -3.7 Government 5,000 4,925 5,050 4,975 4,825 -2.5 -1.6 625 600 575 500 500 0.0 7.1 4,375 4,325 4,475 4,475 4,325 -2.8 -2.5 34,364 35,753 31,963 30,679 ... -6.6 -1.2 22,448 22,692 19,812 19,304 ... -11.4 -6.6 Restaurants & Bars 4,830 5,292 4,793 4,766 ... 2.9 -5.3 Gasoline, EBR 7,085 7,769 7,357 6,609 ... 2.7 25.6 2,655 2,914 2,688 2,502 ... -2.9 6.4 Contracting 5,541 6,349 6,507 8,335 ... 37.5 -14.0 Hotel/Motel 981 1,267 927 1,077 ... 24.0 -5.8 Federal Government State and Local Government Sales ($000s), ADOR Gross Retail Retail Gallons (000s) ADOT Graham County Civilian Labor Force, ADOC & EBR Employment Unemployment Unemployment Rate (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 14,975 15,000 14,875 14,875 14,825 -0.8 -4.1 12,900 12,950 12,925 13,000 13,025 0.8 -4.6 2,075 2,050 1,950 1,875 1,800 -11.1 -0.6 12.8 12.7 13.2 13.7 13.6 -9.9 3.1 Employees on Nonagricultural Payrolls, ADOC & EBR Total 7,850 7,825 7,850 7,850 7,900 -4.8 -3.3 Total Private 5,000 5,000 4,975 4,925 4,825 -8.1 -7.5 Goods‐Producing 1,000 1,000 1,000 975 975 -4.9 -12.6 Service‐Providing 6,850 6,825 6,850 6,875 6,925 -4.8 -1.9 Trade, Transportation, and Utilities 1,350 1,325 1,350 1,275 1,225 -12.5 -5.3 Other Private Service‐Providing 2,650 2,675 2,625 2,675 2,625 -7.1 -6.6 Government 2,850 2,825 2,875 2,925 3,075 0.8 4.6 475 450 450 450 450 5.9 7.6 2,375 2,375 2,425 2,475 2,625 0.0 4.1 20,729 19,266 20,847 19,342 ... 5.5 1.7 -2.6 Federal Government State and Local Government Sales ($000s), ADOR Gross Retail Retail 16,372 14,630 15,920 14,797 ... 5.9 Restaurants & Bars 1,842 2,001 2,026 1,739 ... 0.1 -1.2 Gasoline, EBR 2,516 2,634 2,901 2,806 ... 7.0 39.0 943 988 1,060 1,063 ... 1.1 17.7 2,808 1,888 2,212 2,241 ... -21.6 -46.5 Gallons (000s) ADOT Contracting www.ebr.eller.arizona.edu 25 Arizona’s Economy Greenlee County Jun 10 Civilian Labor Force, ADOC & EBR Employment Unemployment Unemployment Rate (%) Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent: Oct 10 month 12‐mo. average 4,050 4,050 4,025 4,050 3,975 -10.7 3,600 3,600 3,600 3,625 3,625 0.7 -9.4 -4.7 450 450 425 425 350 -58.8 -33.5 10.6 10.3 10.5 10.6 9.3 -53.5 -26.0 Employees on Nonagricultural Payrolls, ADOC & EBR Total 3,300 3,350 3,400 3,425 3,450 11.3 -14.6 Total Private 2,750 2,775 2,825 2,875 2,900 14.9 -17.4 Goods‐Producing 2,250 2,275 2,325 2,375 2,400 18.5 -19.0 Service‐Providing 1,050 1,075 1,075 1,050 1,050 -2.3 -3.6 Trade, Transportation, and Utilities 225 225 225 225 200 0.0 -8.8 Other Private Service‐Providing 275 275 275 275 300 0.0 -9.7 Government 550 575 575 550 550 -4.3 1.9 50 50 50 25 25 0.0 18.8 500 525 525 525 525 -4.5 0.8 11,394 11,225 11,459 10,784 ... ... -2.4 Federal Government State and Local Government Sales ($000s), ADOR Gross Retail Retail 10,453 10,236 10,376 9,708 ... ... -3.2 Restaurants & Bars 332 339 292 369 ... ... -10.0 Gasoline, EBR 609 650 791 708 ... 32.6 18.2 Gallons (000s) ADOT 228 244 289 268 ... 25.3 -0.4 Contracting 498 1,801 2,573 4,625 ... ... -60.6 Hotel/Motel 531 492 573 600 ... 40.5 -0.5 La Paz County Jun 10 Civilian Labor Force, ADOC & EBR Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 7,900 7,975 7,975 8,300 8,350 7.7 3.7 7,125 7,150 7,175 7,500 7,650 8.5 3.5 775 825 800 800 700 0.0 5.6 9.5 9.6 9.6 9.4 8.2 -7.2 1.8 4,875 4,925 4,925 5,125 5,150 5.1 2.4 2,575 2,525 2,525 2,500 2,550 0.0 1.3 Goods‐Producing 175 175 175 175 175 0.0 -22.5 Service‐Providing Employment Unemployment Unemployment Rate (%) Employees on Nonagricultural Payrolls, ADOC & EBR Total Total Private 4,700 4,750 4,750 4,950 4,975 5.3 3.6 Trade, Transportation, and Utilities 1,150 1,100 1,100 1,075 1,125 -8.2 0.5 Other Private Service‐Providing 1,250 1,250 1,250 1,250 1,250 8.7 6.8 Government 2,300 2,400 2,400 2,625 2,600 10.6 3.6 350 350 325 325 325 0.0 5.8 1,950 2,050 2,075 2,300 2,275 12.3 3.2 17,016 17,922 15,525 15,206 ... 3.7 10.0 Retail 8,321 8,290 7,169 7,664 ... 5.9 5.5 Restaurants & Bars 1,733 1,892 1,452 1,520 ... -15.0 -10.4 Gasoline, EBR 6,961 7,740 6,905 6,021 ... 6.6 25.6 2,609 2,904 2,523 2,280 ... 0.8 3.5 1,070 1,136 1,065 1,072 ... 227.4 -21.5 486 -348 355 364 ... -38.0 -16.7 Federal Government State and Local Government Sales ($000s), ADOR Gross Retail Gallons (000s) ADOT Contracting 26 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Mohave County Civilian Labor Force, ADOC & EBR Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent month 12‐mo. average Oct 10 93,400 93,700 92,900 93,200 91,800 -0.2 0.2 Employment 83,400 83,500 82,600 83,000 82,200 -0.2 -0.2 Unemployment 10,000 10,200 10,300 10,200 9,600 0.0 3.4 11.0 10.9 10.9 11.0 10.6 0.5 3.2 Unemployment Rate (%) Employees on Nonagricultural Payrolls, ADOC & EBR Total 46,200 46,100 46,100 46,200 46,500 -0.6 -2.0 Total Private 37,900 37,800 37,700 37,700 38,000 -1.0 -2.7 Goods‐Producing 5,600 5,600 5,500 5,500 5,500 -1.8 -10.8 2,700 2,700 2,700 2,700 2,700 -3.6 -16.0 Mining and Construction Manufacturing 2,900 2,900 2,800 2,800 2,800 0.0 -5.3 Service‐Providing 40,600 40,500 40,600 40,700 41,000 -0.5 -0.6 10,500 10,500 10,500 10,500 10,600 -0.9 -2.4 Trade, Transportation, and Utilities Information 800 800 800 800 800 -11.1 -9.3 Financial Activities 1,600 1,600 1,600 1,600 1,700 0.0 -6.2 Professional and Business Services 3,200 3,200 3,200 3,200 3,200 -3.0 -2.0 Educational and Health Services 7,900 7,900 8,000 8,100 8,200 3.8 4.2 Leisure and Hospitality 6,100 6,000 6,000 5,900 5,900 -3.3 -0.4 Other Services 2,200 2,200 2,100 2,100 2,100 -4.5 -6.6 Government 8,300 8,300 8,400 8,500 8,500 1.2 1.2 800 900 600 500 500 0.0 23.8 7,500 7,400 7,800 8,000 8,000 1.3 -0.3 Federal Government State and Local Government Sales ($000s), ADOR Gross Retail 135,905 135,029 133,070 131,474 ... 2.0 2.1 Retail 95,117 90,825 90,104 94,340 ... 2.3 -1.4 Restaurants & Bars 16,922 17,120 16,488 14,950 ... 0.6 2.8 Gasoline, EBR 23,865 27,084 26,478 22,184 ... 1.8 18.9 8,945 10,161 9,674 8,400 ... -3.8 -0.5 Contracting 25,059 19,106 18,422 18,748 ... -35.5 -35.2 Hotel/Motel 3,852 4,640 3,775 4,087 ... 14.9 6.1 62 31 13 18 12 -14.3 15.3 26 21 13 18 12 -14.3 -6.4 Gallons (000s) ADOT New Housing Units Authorized, Census C‐40 Total Units Single Family Units www.ebr.eller.arizona.edu 27 Arizona’s Economy Navajo County Civilian Labor Force, ADOC & EBR Employment Unemployment Unemployment Rate (%) Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent month 12‐mo. average Oct 10 42,025 41,525 41,275 40,650 40,125 -2.6 0.1 35,550 34,825 34,750 34,525 34,025 -3.5 -1.7 6,475 6,700 6,525 6,125 6,100 3.0 11.4 15.0 14.3 16.0 16.0 15.8 5.4 11.4 Employees on Nonagricultural Payrolls, ADOC & EBR Total 27,025 26,300 26,500 26,250 26,050 -4.7 -3.8 Total Private 17,125 16,900 16,800 16,450 16,300 -5.0 -3.6 Goods‐Producing 1,675 1,675 1,650 1,650 1,600 -17.9 -26.3 1,275 1,275 1,250 1,250 1,200 -15.8 -25.4 Mining and Construction Manufacturing 400 400 400 400 400 -23.8 -28.7 Service‐Providing 25,350 24,625 24,850 24,600 24,450 -3.6 -1.9 Trade, Transportation, and Utilities 5,350 5,225 5,225 5,075 5,025 -4.3 -0.9 Information 1,075 1,075 1,075 1,075 1,075 0.0 1.0 Financial Activities 450 425 425 425 425 -5.6 -7.4 Professional and Business Services 950 950 950 950 950 -5.0 -6.9 Educational and Health Services 3,600 3,650 3,675 3,700 3,675 2.1 3.6 Leisure and Hospitality 3,225 3,125 3,075 2,875 2,850 -7.3 -0.3 800 775 725 700 700 -6.7 -2.2 -4.1 Other Services Government 9,900 9,400 9,700 9,800 9,750 -4.2 Federal Government 2,000 1,825 1,875 1,675 1,650 -5.7 5.7 State and Local Government 7,900 7,575 7,825 8,125 8,100 -3.9 -6.0 90,581 94,752 90,475 88,091 ... 4.1 -1.4 67,449 68,024 66,649 66,755 ... 3.5 -4.6 Sales ($000s), ADOR Gross Retail Retail Restaurants & Bars 8,076 9,503 8,107 8,057 ... 1.9 -3.5 15,055 17,225 15,718 13,278 ... 8.3 17.6 5,643 6,462 5,743 5,028 ... 2.4 -1.5 Contracting 9,487 12,158 10,490 10,499 ... -12.5 -33.7 Hotel/Motel 3,552 4,022 3,329 3,448 ... 1.5 -5.6 9 8 10 7 7 -41.7 -19.6 9 8 10 7 7 -41.7 -19.6 Gasoline, EBR Gallons (000s) ADOT New Housing Units Authorized, Census C‐40 Total Units Single Family Units 28 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Santa Cruz County Civilian Labor Force, ADOC & EBR Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 17,950 18,300 18,375 18,350 18,450 -0.4 -2.3 15,150 15,125 14,950 14,950 14,950 -2.3 -4.5 2,800 3,175 3,425 3,400 3,500 8.5 10.8 16.5 14.8 14.8 15.1 15.8 9.2 14.0 12,150 12,100 12,050 12,025 12,125 -3.4 -6.7 8,475 8,400 8,225 8,225 8,350 -3.5 -8.9 Goods‐Producing 825 825 825 825 825 3.1 -9.0 Service‐Providing Employment Unemployment Unemployment Rate (%) Employees on Nonagricultural Payrolls, ADOC & EBR Total Total Private 11,325 11,275 11,225 11,200 11,300 -3.8 -6.6 Trade, Transportation, and Utilities 4,850 4,775 4,750 4,750 4,850 -1.0 -8.9 Other Private Service‐Providing 2,800 2,800 2,650 2,650 2,675 -9.3 -8.7 Government 3,675 3,700 3,825 3,800 3,775 -3.2 -1.7 Federal Government 1,600 1,575 1,575 1,575 1,575 0.0 1.5 State and Local Government 2,075 2,125 2,250 2,225 2,200 -5.4 -3.8 32,084 29,988 31,391 27,937 ... -22.9 -1.5 -5.5 Sales ($000s), ADOR Gross Retail Retail 23,953 21,863 23,380 20,524 ... -28.7 Restaurants & Bars 3,559 3,305 3,146 2,937 ... -6.1 5.5 Gasoline, EBR 4,572 4,820 4,864 4,475 ... 3.1 17.2 Gallons (000s) ADOT 1,714 1,808 1,777 1,695 ... -2.5 -3.8 Contracting 5,763 4,665 4,500 8,014 ... 71.4 -20.1 Hotel/Motel 873 933 793 969 ... 17.4 19.6 3 1 1 5 5 0.0 -27.2 3 1 1 5 5 0.0 -27.2 New Housing Units Authorized, Census C‐40 Total Units Single Family Units www.ebr.eller.arizona.edu 29 Arizona’s Economy Yavapai County Civilian Labor Force, ADOC & EBR Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent month 12‐mo. average Oct 10 100,000 100,200 100,000 100,100 99,800 Employment 90,000 90,100 89,800 90,200 Unemployment 10,000 10,100 10,200 9,900 10.0 9.9 10.1 Unemployment Rate (%) 0.3 0.3 90,400 0.6 -0.3 9,400 -2.1 6.5 10.0 9.7 -2.1 6.2 Employees on Nonagricultural Payrolls, ADOC & EBR Total 55,600 55,400 55,600 56,000 56,700 0.5 -2.3 Total Private 45,200 45,100 45,100 45,200 45,700 2.0 -2.1 Goods‐Producing 7,500 7,500 7,500 7,400 7,500 -2.6 -10.7 4,900 4,900 4,900 4,900 5,000 -2.0 -12.4 Mining and Construction Manufacturing 2,600 2,600 2,600 2,500 2,500 -3.8 -7.3 Service‐Providing 48,100 47,900 48,100 48,600 49,200 1.0 -0.9 11,700 11,700 11,700 11,700 11,900 2.6 -0.2 Trade, Transportation, and Utilities Information 500 500 500 500 500 0.0 -6.3 Financial Activities 1,900 1,900 1,900 1,900 1,900 0.0 -1.7 Professional and Business Services 3,400 3,400 3,400 3,500 3,500 2.9 -4.4 Educational and Health Services 10,600 10,600 10,700 10,900 11,000 3.8 2.1 Leisure and Hospitality 7,500 7,400 7,300 7,200 7,300 2.8 -0.7 Other Services 2,100 2,100 2,100 2,100 2,100 5.0 -0.8 -3.1 Government 10,400 10,300 10,500 10,800 11,000 -5.2 Federal Government 1,800 1,800 1,600 1,500 1,500 7.1 7.6 State and Local Government 8,600 8,500 8,900 9,300 9,500 -6.9 -4.7 146,092 141,199 145,054 139,238 ... 0.7 -0.5 102,941 98,112 101,586 97,735 ... -0.7 -4.4 Restaurants & Bars 23,370 22,049 21,939 21,798 ... 3.1 -1.4 Gasoline, EBR 19,780 21,038 21,528 19,705 ... 5.7 26.3 7,414 7,892 7,866 7,461 ... -0.1 5.9 Contracting 25,604 23,104 25,246 21,124 ... -18.4 -35.3 Hotel/Motel 8,090 7,761 7,030 8,188 ... 6.2 -0.6 19 17 22 23 16 -61.9 -9.3 19 17 22 23 16 -56.8 -30.5 Sales ($000s), ADOR Gross Retail Retail Gallons (000s) ADOT New Housing Units Authorized, Census C‐40 Total Units Single Family Units 30 Economic and Business Research Center, Eller College of Management, The University of Arizona January, 2011— Winter Issue Yuma County Civilian Labor Force, ADOC & EBR Jun 10 Jul 10 Aug 10 Sep 10 % change vs. year ago for most recent Oct 10 month 12‐mo. average 90,100 92,100 94,000 92,100 92,900 7.3 1.6 Employment 66,300 65,600 65,600 67,100 68,100 1.6 -2.8 Unemployment 23,800 26,500 28,400 25,000 24,800 26.5 18.2 23.3 23.1 23.5 23.8 25.2 16.7 16.6 -4.6 Unemployment Rate (%) Employees on Nonagricultural Payrolls, ADOC & EBR Total 47,700 47,100 47,500 48,200 48,800 -0.2 Total Private 33,100 32,900 33,000 33,000 33,500 -1.5 -7.0 Goods‐Producing 4,500 4,500 4,500 4,500 4,600 7.0 -11.6 Mining and Construction 2,700 2,700 2,700 2,700 2,800 0.0 -16.4 Manufacturing 1,800 1,800 1,800 1,800 1,800 20.0 -3.2 Service‐Providing 43,200 42,600 43,000 43,700 44,200 -0.9 -3.8 Trade, Transportation, and Utilities 8,600 8,600 8,600 8,600 8,700 -6.5 -11.8 Information 1,300 1,300 1,300 1,200 1,200 -25.0 -8.4 Financial Activities 1,600 1,600 1,600 1,600 1,600 0.0 0.5 Professional and Business Services 4,100 4,100 4,100 4,100 4,200 -2.3 -7.4 Educational and Health Services 6,600 6,500 6,600 6,700 6,800 4.6 2.8 Leisure and Hospitality 4,700 4,600 4,600 4,600 4,700 -2.1 -8.9 Other Services 1,700 1,700 1,700 1,700 1,700 6.3 -0.5 14,600 14,200 14,500 15,200 15,300 2.7 1.3 Government Federal Government State and Local Government 3,900 3,900 3,700 3,700 3,700 0.0 3.6 10,700 10,300 10,800 11,500 11,600 3.6 0.5 Sales ($000s), ADOR Gross Retail 112,980 112,467 114,646 122,777 ... 6.2 -1.5 Retail 79,958 79,205 81,667 91,118 ... 7.6 -3.5 Restaurants & Bars 15,152 14,216 14,006 13,997 ... 3.8 -5.9 Gasoline, EBR 17,870 19,046 18,973 17,662 ... 1.2 14.2 Gallons (000s) ADOT 6,697 7,145 6,932 6,688 ... -4.3 -6.4 Contracting 24,629 18,084 18,225 18,737 ... -24.4 -44.9 Hotel/Motel 3,273 2,781 3,262 3,235 ... -10.8 -3.6 28 42 40 29 26 0.0 -33.4 28 42 40 29 26 0.0 -26.8 New Housing Units Authorized, Census C‐40 Total Units Single Family Units www.ebr.eller.arizona.edu 31 Arizona’s Economy ECONOMIC AND BUSINESS RESEARCH CENTER McClelland Hall, Room 103 P.O. Box 210108 1130 E. Helen Street Tucson, AZ, 85721-0108 Phone: 520-621-2155 Fax: 520-621-2150 E-mail: ebrpublications@eller.arizona.edu Marshall J. Vest Director (520) 621-4075 mvest@eller.arizona.edu Alberta Charney, Ph.D. Senior Research Economist (520) 621-2291 acharney@eller.arizona.edu THE UNIVERSITY OF ARIZONA To subscribe to Arizona's Economy or other Economic and Business Research Publications, visit: ebr.eller.arizona.edu/subscribe/ Arizona’s Economy, published quarterly by the Economic and Business Research Center at the Eller College of Management, is provided as an educational service by The University of Arizona. Correspondence should be addressed to EBR Publications, McClelland Hall Room 103, PO Box 210108, Tucson, Arizona 85721-0108. Arizona’s Economy is available online at: azeconomy.eller.arizona.edu As part of The University of Arizona’s public mission to improve quality of life for the people of Arizona and the nation, the Economic and Business Research Center is dedicated to providing Arizona citizens and decision makers with high quality economic data and objective forecasts and analyses. Copyright 2010 by The University of Arizona. Information contained in this publication may be copied or reprinted with credit to the Eller College of Management at The University of Arizona. Visit us online at ebr.eller.arizona.edu! Pia Montoya Database Specialist (520) 621-2523 pmontoya@eller.arizona.edu Lora Mwaniki-Lyman Research Economist (520) 626-6439 loramwa@eller.arizona.edu Maile L. 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