NLC Wraps Up Local Economic Conditions Blog Series

April 12, 2013

By Emily Pickren

On the heels of the release of the National League of Cities’ report on its annual Local Economic Conditions (LEC) Survey, NLC staff from the Center for Research and Innovation and Center for Fedral Relations did a four-part Local Economic Conditions blog series highlighting different perspectives on the results of the 2013 LEC Survey.   

The results of the survey indicate that despite improvement in many economic health indicators, local officials from around the country report that their cities’ economies have not yet rebounded, due in large part to slow income and job growth. The basic needs of cities' most vulnerable populations are growing and high unemployment rates continue to be an issue. While these are perhaps the most salient findings, the breadth of the survey results are explored in more detail in the Local Economic Conditions blog series.

The first post focuses on the state of the commercial property market, which has largely been overshadowed by nascent improvements in the residential property market. The results of the LEC survey show that local officials saw a leveling off of the commercial property market in 2012, with over half of city officials reporting that commercial property vacancies and values are still a problem in their communities.  

The so-called “skills gap” is examined in the second post. More than one in two city officials reported that current local workforce skills pose a problem for the economic health of their communities. Nearly nine in 10 city officials noted that workforce alignment has not improved over the past year.

The third post looks at a new series of questions for local officials included in the LEC survey this year regarding the policy areas that they anticipate focusing on in 2013. The results of the survey reveal that city officials will continue to focus on core areas of local government that protect the welfare and safety of residents while increasing their focus on areas that create new jobs and revenue.

The final post examines anticipated local responses and impacts of a federal limitation on the tax-exemption of municipal bonds, particularly in light of recent FY2014 budget proposals in the House, Senate and the Administration. All three proposal leave open the possibility of limiting the exemption for municipal bonds. While the President's budget includes new resources for infrastructure investments, these new tools are no substitute for the tax exempt municipal bond tool.

Local officials are doing everything in their power to ensure a robust recovery in the commercial property market, as cities depend on a healthy property market to provide tax revenues for essential services. Seventy-three percent of city officials report that they will be increasing their focus on downtown/commercial redevelopment. And cities across the country are finding ways to be responsive to their business community while also tackling problems related to the labor market and the workforce skills gap. Many cities, from Avondale, Ariz. to St. Paul, Minn. are partnering with businesses, economic development organizations, educational institutions and other stakeholders to examine the depth and scope of labor market issues and to educate residents for available employment.