Monday, May 28, 2012

Scottsdale's economic picture brightens as unemployment drops to 5.9%

Scottsdale's economy is showing signs of improvement after big job losses over the past few years.

The city's unemployment rate in March of 5.9 percent is down a full point from a year ago and the number of jobs is higher than it has been since December 2009, according to the latest figures from the U.S. Bureau of Labor Statistics.

"Scottsdale's economy is mirroring the U.S. economy in a recovery that is extremely anemic by historic standards, but it's a recovery," said Elliott Pollack, a Scottsdale-based economist and real-estate consultant.

City sales-tax collections are up 5 percent for the current fiscal year, real estate prices are stabilizing and the jobs picture is getting better with some small and large employers adding staff.

The city's 5.9 percent unemployment rate is well below the 7.4 percent figure for Maricopa County and 8.6 percent statewide. The national unemployment rate was 8.2 percent in March and fell to 8.1 percent in April.

Scottsdale has added 578 jobs in the past year, the bureau reported.

West Pharmaceutical Services Inc. added 50 employees and $18 million in investment to its Scottsdale Airpark facilities, said Bob Tunis, Scottsdale economic development manager.

Starwood Hotels and Resorts Worldwide Inc. brought a regional financial headquarters with about 300 jobs to the Scottsdale Quarter.

Fender Musical Instruments, with 400 employees, relocated from the Salt River Reservation to Scottsdale's Perimeter Center and Yelp is continuing to hire for its expanding office at the downtown Galleria Corporate Centre, Tunis said.

San Francisco-based Yelp, which allows consumers to rate local businesses, started with 15Scottsdale employees in January 2010 and now has about 380 full-time employees with plans for more hiring over the next year, said Yelp spokeswoman Kristen Whisenand.

Global Med, a 10-year-old company in the Scottsdale Airpark, has gone from 18 to 84 employees in the past two years and had an additional 30 temporary employees at the end of 2011, spokesman Roger Downey said.

Global Med is adding jobs and picking up steam with its sophisticated cameras, software and telemedicine cart that allows doctors to examine and communicate with patients hundreds or thousands of miles away.

Global Med's biggest client is the U.S. Department of Veterans Affairs, which bought about 2,000 of its telemedicine stations at an average cost of about $30,000,Downey said.

Some jobs lost

Some of Scottsdale's largest employers have shed jobs in the past few years.

General Dynamics C4 Systems, based in Falls Church, Va., cut its Scottsdale workforce from a full-time equivalency of 3,187 two years ago to 2,551, spokeswoman Fran Jacques said. That included a layoff of 500 engineers and other workers last June.

The company's Advanced Communications Systems in Scottsdale has cut its FTE by 21 percent since 2010 to 567.

"The workforce adjustments are based on improving our efficiency," Jacques said, adding that it's vital for government contractors to streamline their operations.

The city cut its payroll to an FTE of 2,455 for the current fiscal year, down 92 jobs from last year, and is expected to cut 33 jobs in the 2012-13 fiscal year.

The Scottsdale Unified School District went from an FTE of 3,210 for the 2008-09 school year to 3,015 this year, with a projected increase of 33 jobs next year.

Scottsdale Healthcare has an FTE of 6,714 workers, up 2.4 percent from 2009.

A long road back

Pollack said the Valley has added about 37,000 jobs the past year but has a long way to go to replace about 250,000 jobs lost in the recession.

"It's going to be 2015 to 2016 until we get all those lost jobs back," he said.

Scottsdale's vital tourism sector is likely to pick up as the national economy improves and people feel more comfortable about taking vacations, Pollack said.

New residents are moving to Scottsdale at a brisker pace, including younger adults who are not saddled with houses to sell while other new residents are looking to buy a second or retirement home before prices start to go up, he said.

Construction of new homes and apartments is expected to have a ripple effect on the economy and create new jobs.

Those gains could be tempered, Pollack said, by labor shortages in the construction trades.

"We've always had our mystery labor force," he said. "We don't know how many had green cards and came across the border to work but I guess we're going to find out."

by Peter Corbett - May. 25, 2012 08:44 AM The Republic |

Scottsdale's economic picture brightens as unemployment drops to 5.9%

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