Which US cities will recover first?

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    Some metro areas will improve as early as late 2009, according to IHS Global Insight.
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Just as some nations will recover before others, some areas of the United States will get back to peak employment by the end of this year or early next year. So where are the bright spots?

The folks at IHS Global Insight have come up with a map that highlights when metro areas are expected to get back to pre-crash levels of employment.

A capital improvement

Recommended: Top 10 metros for job growth

The first place to look for early recovery is greater Washington, D.C. No surprise there.

"The only growing sector in the economy in 2008, 2009 was the federal government," says Jim Diffley, managing director of Global Insight's regional services, in an interview. "And it's embarked – of necessity, I would say – on an even stronger growth path."

So more federal jobs will boost the economy throughout northern Virginia and the Maryland suburbs.

Lone Star rebound

Another bright spot: Texas. "Texas has always looked better than everybody else," Mr. Diffley says. "I would almost argue that Texas is not turning up so much as it never turned down."

Of course, some things have turned negative for the Lone Star state lately. Oil prices have plunged. Exports have collapsed (Texas is America's biggest exporting state). But Diffley says that strong underlying growth there plus a recovery in some foreign markets will work to the state's advantage.

The tale behind the Mountain West is similar. They didn't turn down (partly because they escaped much of the housing bubble) so they have far less to make up before they return to peak employment before the recession.

Mired in New York

Other metro areas will lag. Wall Street's collapse means that metropolitan New York and much of Connecticut won't fully recover for another five years, Mr. Diffley says. Ditto for cities in southern Michigan and elsewhere in the Rust Belt.

None of this suggests that the nation is yet on the mend. "We're not calling an end to the recession, by any means, right now," he adds. But "the recession will end. And here's the way the metros will come back."

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