Real Estate Forum recap

Alivia Metts

In just two years the unemployment rate jumped from 3.3 percent to double digits in 2009, the first time since 1986. While the Great Recession ended in June 2009 after 18 months, the county is still feeling the effects on many fronts including high unemployment.

There were 5,600 more people unemployed in 2011 than in 2007. Nearly four years after the recession settled in, Kootenai County’s unemployment more than tripled to nearly 11 percent in 2011. Today, the unemployment rate stands at 9.8 percent, the 14th highest in the state.
Approximately 4,700 jobs were lost from 2007 to third quarter of 2011 — nearly 4,000 in 2009 alone. The industries hit hardest were directly related to the housing collapse. More than half of the losses were in construction in specialty trades — directly affecting the materials manufactured and sold in the wood products and retail sectors. Health care was one of the select few industries that breathed life into the economy during the recession and its aftermath, generating more than 700 jobs to become the No. 1 employment sector in the county.
Kootenai County is still showing signs of high unemployment but at less significant levels — 700 jobs lost in 2010, but 200 gained by the third quarter of 2011. The trend is moving upward and is projected to hover slightly around a half percent, over the next year, according to data obtained from Avista Corp.
There was an obvious disparity between job applicants and openings. During the depths of the recession in 2009, there were 8.7 job applicants for every job opening registered through the Idaho Department of Labor. By 2011, that was cut significantly to 3.6. Just over the past year, the number of job openings increased 27 percent. This signifies a brighter outlook for job seekers as more employers gain confidence in the market.
Using initial claims data to detect emerging employment trends, outsized gains garner attention because they suggest looming employment weakness, which can spread through the rest of the economy. Outsized decreases imply impending employment strength. Initial claims increased 50 percent from 2008 to 2009, which indicated the employment weakness that was seen in 2009. From 2009 to 2011, initial claims decreased 23 percent, which is reflected in the less significant decreases in employment the county has been experiencing.
Although in-migration slowed through the recession, it picked up over the past two years. Large influxes of people tend to push wages upward due to job growth opportunities. However, that has not been the case. The job opportunities are not as plentiful, and in-migration is less than stellar. But the figures show signs of retirees still moving to the area although at a less significant rate. More than 50 percent of the people moving into Kootenai County were from Washington and California in 2011. Since 2007, the number of people migrating from California has slowed significantly with fewer people riding the coattails of the housing bubble, purchasing fewer second homes.
Demographic projections over the next decade provided by EMSI show large shifts to the 65 and over age group. This is largely due to aging resident baby boomers combined with the projected influx of older people from other states. Most staggering, is the projected loss of the 45- to 49-year-olds — primary wage earners. This could be attributed to the continued weakness in the economy, forcing dislocated workers to seek jobs elsewhere.
Housing is still trying to climb out of the depths of 2010. There were only 600 housing starts in Kootenai County in 2010, the fewest since 1990. That number increased 36 percent in 2011 to just over 800. According to Avista, housing starts are projected to rise almost 6 percent in 2012.
The next decade will be different. Population growth outpaced job growth over the past decade. Putting the recession behind, Kootenai County will continue to feel the effects over the next decade as job growth is projected to keep pace with population growth over the next 10 years.
Manufacturers have been hiring more as their backlogs grow. Health-care providers are seeing more strains on their services, pushing those employers to seek more workers with higher qualifications. And more businesses are hiring temporary workers until they feel confident the economy is recovering. All industries are faced with an aging workforce, providing plenty of opportunities over the years to come.

Alivia Metts is the Regional Economist for the Idaho Department of Labor.