Alabama's Economic Progresscomment (0)
April 19, 2012
By Jim Williams
Alabama, like other states, is in the middle of a slow recovery from the Great Recession that began in 2008. Recent statistics show signs of progress, but they also point to remaining weaknesses.
Alabama is one of 45 states in which personal income, measured on a per-person basis, regained its pre-recession level in 2011. However, the amount of income, and the rate at which it grew, were below average.
January was the fifth consecutive month in which the unemployment rate in Alabama was below the national average. On the other hand, the number of unemployed remains high, at 7.8 percent of the labor force, and in 24 counties more than 10 percent of workers are unemployed. The total number of people employed in Alabama remains below the peak that was achieved in December 2007.
Home sales and construction were hit especially hard by the recession. Housing statistics maintained by the University of Alabama’s (UA) Alabama Center for Real Estate show that February was the eighth consecutive month in which more Alabama homes were sold than in the same month for the prior year. Housing in Alabama remains very affordable by national standards that compare home prices to personal income. However, the number of homes sold annually remains below the pre-recession years, and the median price is still 15 percent less than its peak in 2007. The average home sold in February had been on the market for 172 days, about a month longer than the average for the five previous years.
Alabama’s home foreclosure rate is half the national average, and the number of foreclosures in February was about 19 percent lower than a year ago, according to the RealtyTrac website.
UA’s Center for Business and Economic Research projects that the state’s economy will grow by 2.5 percent during 2012. This reflects steady progress when compared with the 2.2 percent increase for 2011 and the 2.0 percent increase for 2010. However, employment is expected to grow by only 1.1 percent.
The center’s most recent survey of Alabama business leaders finds that their confidence in the state’s economic prospects has returned to pre-recession levels. Perhaps this positive sentiment is the strongest available evidence that we are in the springtime of economic recovery in Alabama.
EDITOR’S NOTE — Jim Williams is executive director for the nonprofit, nonpartisan Public Affairs Research Council of Alabama. Jim may be contacted at email@example.com.