Research Shows Cities Still Working Through Recession and Recovery, Jobs Numbers Show Improvement

March 19, 2012
New research from the NLC shows that the nation still has a considerable way to go before the recovery will find its way into every community. Recent jobs numbers, while improving, do not show sufficient enough growth to propel the nation to full economic recovery.

In an NLC survey, city leaders report that individual families continue to feel the pain most acutely. In addition to the high unemployment numbers, residential property values are still down and, in many cases, have continued to drop (36 percent of cities). Demands by families for safety net services, such as local food banks, have increased significantly in the past year (31 percent of cities). 

Despite this, there are signs of improvement. Mirroring the positive news at the national level, 57 percent of community leaders report modest improvements in unemployment and in the retail sector. In responding to the survey, which was sent to lead executives in cities, 45 percent of city leaders said that their commercial property vacancies are improving. Cities are also seeing modest gains in business permits/licenses with 43 percent saying that the situation is improving in their community. 

Cities derive their revenue from sales taxes, income taxes and, for the majority of cities, property taxes. When city revenues remain stagnant, it places a greater strain on cities responding to the increased demands for city services. 

"Our latest numbers point to improving local economic conditions," said Christopher Hoene, director for NLC's Center for Research and Innovation. "But, we're a long way from recovery. It's clear that cities and city residents will still be confronting the impacts of this past recession for a while longer." 

Evidence that cities are not out of the woods yet includes 39 pecent reporting decreases in city personnel. Cities have been eliminating personnel since the summer of 2008 in order to balance budgets in response to the recession. 

"The unemployment numbers are nothing to cheer just yet," said NLC President Ted Ellis, mayor of Bluffton, Ind. "Both the federal government and local officials need to find ways to partner that will lay down a framework to allow for local growth and to make the nation competitive for years to come."