Texas dominates economic recovery rankings

November 30, 2010

San Antonio Express-News

David Hendricks

Four Texas metropolitan areas — Houston, Austin, Dallas and San Antonio — dominate the top 15 U.S. cities in a global study to determine the level of cities' recovery from the recession.

The Brookings Institution Metropolitan Policy Program report ranks 150 cities: 50 in the United States, 50 in Europe and 50 in the rest of the world. Austin was the highest-ranked U.S. city and No. 26 in the world. Dallas ranks as the No. 4 U.S. city and No. 39 in the world. San Antonio ranks No. 11 in the U.S. and No. 51 in the world.

Houston is ranked No. 15 in the U.S. and No. 61 in the world, according to the report, Global MetroMonitor, which received assistance from the London School of Economics and Political Science.

San Antonio, Houston and Dallas rose in global rankings during the past two years from their pre-recession rankings. Austin stayed about the same, ranking No. 25 among the 150 metro areas before the recession.

The report found that income and job growth in metro areas exceed those of their nations as a whole, which means large cities are leading the global recovery from the 2007-09 recession.

The cities recovering the fastest are outside the United States. Twenty-nine of the 30 best-recovering cities are outside the U.S., with only Austin making that group.

Metro areas in Asia, Latin America and the Middle East are making the strongest recoveries. The top five, in order, are: Istanbul, Turkey; Shenzhen, China; Lima, Peru; Singapore; and Shanghai, China.

Low-income areas

The findings indicate the increased mobility of companies to lost-cost and low-income areas of the world, said Keith Phillips, Federal Reserve senior economist in San Antonio.

The report measures incomes and employment back to 1993 and ranks metro areas in three different periods: pre-recession (1993-2007), recession (2007-09) and recovery (2009-10).

San Antonio was ranked at No. 78 pre-recession, with 1.8 percent annual employment growth and 2.1 percent annual income growth. San Antonio rose to a No. 32 ranking in the world during the recession — making it the highest-ranked city in the U.S. then — with 0.2 percent employment growth and a 1.7 percent drop in total income. The No. 51 ranking during the recovery came from 0.2 percent in job growth and a 3.5 percent increase in income growth.

'Less prone to swings'

"We're very stable," Phillips said of San Antonio. "We're less prone to swings."

Houston was ranked No. 91 pre-recession with 1.7 percent employment growth and 1.6 percent in income growth. Houston's ranking rose to No. 84 during the recession with a 0.3 percent drop in jobs and a 6.3 percent drop in incomes. The recovery ranking of No. 61 came from a 0.2 percent drop in employment and a 2.8 percent increase in incomes the last two years.

Austin grew strongly before the recession and was ranked 25th in the world with a 3.1 percent annual rise in employment and 3.4 percent rise in incomes between 1993 and 2007. Austin sank to No. 40 in the world during the recession but rose to No. 26 afterward with annual employment gains of 3.2 percent and income increases of 2.7 percent during 2009-10.

The Dallas metro area started at No. 71 in the world before the recession with 1.9 percent annual employment gains and 2.3 percent income gains. Dallas went to No. 75 during the recession but rose to No. 39 with 1.7 percent annual employment gains and 2.7 percent income gains during the past two years.

Just as low-wage and low-business cost areas did well around the world, Texas dominated the U.S. metropolitan rankings for the same reasons, Phillips said.

Companies can move to Texas from high-cost areas of the United States and pay lower wages.

But real wages, after housing and food, are higher for Texas workers than in high-cost U.S. metro areas, Phillips said.

http://www.chron.com/disp/story.mpl/business/7317967.html

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