Employment and economic growth reports are showing some signs that the national economy is experiencing “stronger and broader growth” according to the Wells Fargo Economics Group’s most recent Monthly Outlook.
The Group expects real GDP growth to reach 3.0% in Q4, 2.5-3.0% in 2015 and real disposable income is expected to increase 2.6% this year after falling last year. Employment gains are predicted to average about 220,000 per month this year, according to the report, which also states that this metric and housing starts have risen every year since 2011.
In another report from the Economics Group released in the last week (Hot or Not? Metro Areas Across the U.S., which we could not find on their website), they note that the employment gains have not been evenly distributed.
The unemployment rate has fallen in all but 13 of the 372 metropolitan areas in the country over the last year. More than 1 million of the 2.5 million jobs added during that time have been in just five metro areas – New York, Los Angeles, Dallas, Houston and Miami. The Dallas-Fort Worth area has experienced job growth at a rate nearly double that of the rest of the country in this time period.
Despite the strong absolute gains in these large metro areas, the gains are not nearly enough to compete with the rapid percentage growth in payrolls occurring in College Station, TX; Grand Rapids, MI; Naples, FL; Fargo, ND; and Myrtle Beach, SC. These smaller metro areas all posted employment gains above 4 percent year over year.
Despite its recent growth, Las Vegas still has the fourth highest unemployment rate among the 51 largest metropolitan areas in the US. The study notes that the hangover from the housing boom and bust are still lingering in some areas. This certainly plays a role in Las Vegas’s high unemployment rate.
The Group attributes the energy boom in some parts of the country for low unemployment and rapid job growth in nearby metro areas and credits the technology sector for growth in other cities.
Overall employment growth should ramp up further as recoveries in long-struggling sectors such as homebuilding, commercial construction and state and local government get back on track. The bulk of that improvement will likely be in the Sunbelt, where steady population gains are fueling demand for housing and services.