Economists: Phoenix More Prepared to Weather Economic Slowdown than a Decade ago

Article originally posted on Phoenix Business Journal on October 11, 2019

If there is an impending recession, it’s likely to be short and shallow, economists studying the Arizona and U.S. economy said Thursday, forecasting that any upcoming market correction would be nothing like the market experienced during 2007 and 2008.

At the Economic Outlook 2020 event on Oct. 10 hosted by the Greater Phoenix Chamber of Commerce, Elliott Pollack, CEO of Elliott D. Pollack & Co., said while it is “very late in the game” of the economic recovery since the last recession, he did not foresee another recession being triggered based on current economic factors.

Pollack said employment growth likely will slow as the U.S. gets closer to full employment and population growth continues to be slow, but neither appears to be enough to trigger a recession.

As for Phoenix, most of the population growth has come from people moving to the city from other areas. So far this year, Phoenix has ranked third in employment growth out of 36 metros studied, ranking behind only Orlando, Florida, and Dallas, Pollack said.

Arizona’s “capture rate” for people moving away from their home city was 7% in 2018, he said, a higher percentage than the state saw in previous years. However, natural population growth has been slow and is expected to remain slow as younger adults are having children later in life and in fewer numbers than previous generations.

At a separate panel discussion that same day hosted by CoStar, Jessica Morin, director of market analytics for CoStar in Phoenix, said national indicators are mixed as far as economic health in the upcoming year, but Phoenix is better prepared to weather an economic downturn than it was a decade ago.

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Phoenix is better prepared in case of a downturn now than when the Great Recession hit just over a decade ago, economists said.