In our last blog post, we looked at an analysis by the Associated Press (AP) that measured economic stress for states and counties across the nation. Its analysis for the month of October revealed that economic stress is down overall. However, elevated bankruptcy, foreclosure and unemployment rates continue to keep many areas, including Florida, economically stressed. Today, we will look at the factors that are impacting stress levels.
Nationwide employment gains in the month of October offset foreclosure and bankruptcy rates, resulting in a decrease in overall stress. Although Florida’s unemployment rate remained unchanged in the month of October, this was offset by an increase in its foreclosure rate.
Several industries are making comebacks. Areas which employ a substantial number of workers in retail, farming, manufacturing, finance and insurance experienced the most significant decreases in economic stress. Still, the transportation and warehousing industries continued to flounder, negatively impacting areas which have workers in those sectors. The national unemployment rate was 9.6 percent in October. This rate increased to 9.8 percent in November, indicating that economic recovery could remain sluggish for some time.
A combination of many factors is contributing to Florida’s economic stress. Florida lacks a substantial manufacturing industry, a sector that is currently experiencing resurgence. Also, Sean Snaith, an economist at the University of Central Florida, says the tourism industry has been substantially impacted by the Gulf oil spill. Further, many tourists are choosing not to travel due to job loss and financial hardships.
The AP has been tracking economic stress since October 2007, right before the beginning of the recession. Since that time, Florida, Nevada, Arizona, California and Idaho have experienced the greatest increases in economic stress.
Source: Associated Press “AP analysis: Economic stress falls to 18-month low,” 13 December 2010