Charlotte Go Slow- Our New Mantra?

Charlotte- What’s the holdup?

I’ve heard many Charlotte business leaders, economists and others say- “Charlotte was the last to go into recession, so it will be the first one out.”  I’ve said it myself, but the real answer?   No, Charlotte has not rebounded as fast as others…at least not yet.

Yes I know the realities. The financial meltdown in September 2008 was a severe shock to the system, a significant set back in our region’s economy. We lost about 10% of our financial jobs in the last 12 months- more if you measure by income… and then there was the uncertainty about the BOA HQ…  Sales tax revenue down. Fees and licenses down… lots of bad, that started big time 4th Q 2008.

Nevertheless, Wells Fargo has filled in the void here making its presence known, and, as you’ll see below, we keep bringing new jobs to Charlotte, both in new headquarters, new services and new cultural attractions.  So why this lack of confidence?

Has the city lost its collective Mojo?  Its nerve?

As the nation moves firmly into recovery mode,  it is time for Charlotte’s banks and Charlotte  business  to step up, start investing and hiring and get this economy  growing again, not sit on the sidelines sniping. The national economic news is virtually All Good. The major exception was Jobs until the march figures were released- the US economy had its best month in jobs since December 2007…

The Dow Jones one Year ago-April 6, 2009, was at  7,976  AND  April 5, 2010? it opened 10,971 .. a 37 % increase in one year.

Lets look at GDP, from the Bureau of Economic Statistics… the worst quarter to the best quarter, in just one year.

Massive one year improvements in GDP

So, in one year, the economy went from 5.4% monthly contraction, to a 5.6% expansion- maybe an expert can tell me, has there ever been a 12 month turnaround so dramatic?

Lets look at jobs

March employment grew by 162,000 in March- wow! Even taking the temporary census workers out, that’s 100,000 per month, a very good start.  But national unemployment remains stubbornly high, at 9.7%  but Charlotte unemployment is worse! For so many years Charlotte was better than the national average- today in Charlotte unemployment is 12.5%, considerably worse, and not showing much sign of improvement.

So, here are the national numbers, again, What’s Up Charlotte?

US Employment- by month

The trend since March, 2009 is quite clear- in a 12 month period the US economy went from losing  500,000 jobs in a month to adding 162,000, one  year later-the most since December 2007, and even adjusted for the hiring of  45,000 temporary Census workers, still a great big jump, and all economists expect this trend to continue.

So has Charlotte been standing still? Not at all, in the last 6 months, Charlotte has:

• Opened a Ritz Carlton Hotel
• Opened the Bechtler Museum of Modern Art- a genuinely world class museum reviewed recently in the New York Times
• Opened the Harvey Gant African-American Museum
• Announced the headquarter relocation of Electrolux US
• Announced the headquarter relocation of Husquavarna North America
• Fifth Third Bank moves its growing operations Uptown
• Celguard, a lithium battery manufacturer gets a $49M grant from stimulus funds to double production creating about 500 jobs, and making a statement about North Carolina’s energy future. President Obama recently visited the plant.
• Begun work on the Uptown campus of UNCC, the building serving he quality MBA program is on its way

• Siemens, a German company, announces $135M investment and expands by over 825 manufacturing jobs

In the next 6 months Charlotte will:

• Open/Move into the 2nd tallest high rise in the city- The Wells Fargo Cultural Center
• Open the NASCAR Hall Of Fame
• Begin the first full seasons of the Knight Theater and NC Music Factory, in Uptown
• Open the new Mint Museum of Craft and Design at the Cultural Center
• Open Sugar Creek Greenway-Riverwalk

Yes I know about heart wrenching cuts at local schools, the library fight… all the more reason we need to kick start this economy-paying for services is much easier with an expanding economy.

Real Estate

They say California leads the country, and in so many ways it does, it is an economic bell weather, and Case Shiller reports excellent data from the Golden State on home prices… January home prices in California are up 4% from their low in May 2009, according to Standard and Poor’s Case Shiller.

Reviewing our own Charlotte 1st Q MLS and data assembled in this Charlotte Real Estate Market Report we see Charlotte home sales way up, and home prices up as well for the Quarter over Quarter median cost per square foot -a modest increase of 2.17%.

My local Realtor group economics are up too- with Relocation’s returning in a big way, we are well on our way to a strong 2010.

Homes are still very affordable here… a doctor’s wife from New Jersey, once they figured out the increase to their standard of living, asked me, “Are there buses bringing physicians down to see Charlotte?”

Recently I read an advertisement from a major local employer asking for Americans to join them in pushing for “more responsible spending” in Washington.  This same local business leader is on the record stating they have lots of cash- that they aren’t investing  because the government is spending too much money…  Really?

Virtually every economist in the world knows that government spending MUST go up in recessions to keep them from turning into Depressions.  It was in the good times (when I can’t find any similar advertisements)  that we were supposed to be reducing our debt, so in times of distress we can spend more, so government can be the “spender” of last resort, to keep the economy from caving in. And it has worked.

The US economy is pulling out of the ditch caused by the financial collapse of September 2008- but the US economy began growing in earnest in the 3rd quarter 2009, Charlotte not so much, and Charlotte still is:

• one of the best educated workforces in the US
• home to a n airline hub and 8th busiest airport in the US
• lower cost of living-housing is 79% of the national average -one of cleanest most accessible cities in the US
• a great climate for outdoor activities
• centrally located on the East coast

It is past time Charlotte starts growing again. It is time to get off the bench and play ball. Invest in your business, in the region, hire, bring down that unemployment, and lets start growing again. It will be good for your business, for Charlotte and the region.

Questions on Charlotte real estate? Try my Charlotte Homes FAQ’s page.