Cochise College CENTER FOR ECONOMIC RESEARCH

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Cochise CollegeCENTER FOR ECONOMIC RESEARCH

• Economic Outlook
• Douglas, AZ

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RECESSION

• 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

                                                  
                                  
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U.S. Recessions Since 1945
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Gross Domestic Product
Seasonally Adjusted Annual Rate
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Inflation (CPI)
Compared to same month previous year
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National Outlook

• Recovery likely in late 2009
• Positive signs in recent weeks
• Financial crisis will slow recovery and growth
• Economic stimulus will have impact

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The Local Economy

• How Cochise County and
• Douglas are impacted

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Retail Trade Commerce
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COCHISE COUNTY Retail Sales Growth
Inflation adjusted compared to same month
previous year
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DOUGLAS Retail Sales TAX REVENUE
Compared to same month previous year
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EXCHANGE RATE AND DOUGLAS RETAIL
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Retail Sales Recent Activity

• 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

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Restaurant Bar Sales Growth
Inflation adjusted compared to same month
previous year
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Restaurant Bar Recent Activity

• 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

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Sales Outlook

• County retail sales at or near bottomrecovery
  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 bottomrecovery
  likely in mid-2009

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Employment
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Unemployment Rates
Jan-Apr only seasonally adjusted
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Monthly Unemployment Rates
Seasonally Adjusted
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Cochise County Monthly Nonfarm Job Growth
Compared to same month previous year
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Cochise County Nonfarm Job Gains/Losses By
Industry
12 months ending Apr 2009
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Cochise CountyNonfarm Job Growth By Industry
12 months ending Apr 2009
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Employment Outlook

• 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

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Housing, Real Estate, Commercial Construction
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New Home Construction
Single Family Residential Building Permits
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Recent SFR Permit Activity

• 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)

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EXISTING HOME SALES

• 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)

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Existing Home SalesDOUGLAS
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Median Home Price
Jan-Apr only
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Median Home Price

• 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

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New Commercial Constructiondouglas
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Outlook

• 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

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Conclusion

• Most of the recession is probably over
• There have been some signs that were at the
  bottom
• The economic stimulus package will have an impact
  on the economy
• Employment probably wont improve until late 2009
  or early 2010

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