The Austin area added about 3,300 jobs between March 2008 and March 2009, according to the Texas Workforce Commission. That's the good news. The bad news is that the local unemployment rate has gone from 3.8 percent in March 2008 to 6.2 percent this past March. Austin is not immune to the recession after all.
What Austin is doing is weathering this recession better than most places. That 6.2 percent unemployment rate is well below the 8.5 percent national rate. While other major cities across the country, and even across Texas, are continuing the downward spiral of job losses, Austin may be slowing down. Just to give a little perspective on how bad it is in other places, the unemployment rate in Michigan is 12.6 percent and California is 11.2 percent.
The fickle unemployment cycle is all part of being a tech-savvy city for Austin. Semiconductor companies in particular are prone to slough off jobs as the business cycle dictates and it can take years for the tech sector to recover. The problem with this particular recession is its reach is much farther and the impact seems to go much deeper.
"Nationally, Microsoft Corp. is cutting jobs for the first time in its 22-year history; the U.S. Postal Service is shedding workers, too. Retailers cut 500,000 jobs last year and have announced 100,000 more layoffs this year," said a recent article in the Austin-American Statesman.
Austin is fortunate to not rely too heavily on any one sector of the economy. The city has certainly been affected by the hard hit the construction industry has taken, with a national unemployment rate of close to 21 percent. However, Austin is bolstered somewhat by government jobs and the University of Texas. Austin economic development consultant Angelos Angelou predicted recently in the Statesman that job growth in the months to come will be lower paying jobs in health care, education and government.
Jobs and housing seem to be the two numbers everyone pins their hopes on in this recession. While Austin is no Florida when it comes to the bad real estate news, the city is not immune to a real estate slump either. According to the Austin-American Statesman, sales of existing homes is at a six year low. While the housing decline has been slow, it does seem to have been steady with 22 consecutive months of sales declines.
"Conditions in the Austin real estate market remain weak, as they do across the state," said D'Ann Petersen, an economist with the Federal Reserve Bank of Dallasin a recent Statesman article. "The national recession has trickled down to Texas and the state, and its major metros are seeing job losses. The credit situation has also impacted the real estate sector in Austin, especially the higher-priced segment."
While the number of homes going on the market has gone down, the average sales price has held pretty steady for Central Texas overall. Houses stay on the market a little bit longer now than in years past, but the next few months are typically good months for home sales as people relocate over the summer. With the continued low mortgage rates and other incentives, it's a great time to buy a house.
Ki's company is located in Central Austin. He maintains a website with information on Austin Texas real estate. His site provides a search of the Austin MLS along with a blog covering Austin real estate.
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