Study shows San Antonio is nation's best-performing city in recession

San Antonio has been ranked the strongest metropolitan area in the country for economic performance, according to a new report from the Brookings Institution.

The Washington, D.C.-based think tank has begun analyzing the impact of the recession throughout America’s metropolitan areas. In the first of a series of quarterly MetroMonitor reports, Brookings ranked San Antonio, Oklahoma City, Austin, Houston and Dallas as the top five metro areas in the country in economic performance in the wake of the recession.

Brookings ranked the top 100 metropolitan areas based on six key indicators — employment, unemployment rates, wages, gross metropolitan product, housing prices and foreclosure rates. This initial MetroMonitor report covers the first quarter of 2009.

The five worst metropolitan areas in the country impacted by the recession are Jacksonville, Fla.; Lakeland, Fla.; Tampa, Fla.; Bradenton, Fla.; and Detroit.

“All metropolitan areas are feeling the effects of this recession, but the distress is not shared equally,” says Alan Berube, research director of the Metropolitan Policy Program at Brookings and co-author of the report. “While some areas of the country have experienced only a shallow downturn, and may be emerging from the recession already, people living in metro areas that are now performing weakest economically should prepare themselves for a long recovery period.”

Howard Wial, director of the Metropolitan Economy Initiative at Brookings and another co-author of the report, argues that the report shows that a national fiscal and monetary policy will not be enough for stimulating the economy.

“Many (metro) areas will need targeted assistance, and since states have no funds available, the federal government will have to step up to fill the void.”

Concentrations of industry activity have both helped and hurts some regional economies during the recession. For example, metropolitan areas in states with specializations in energy and government employment — such as Texas, New Mexico, Oklahoma, Arkansas and Louisiana — have largely been insulated by the recession. However, metropolitan areas in states like Michigan and Ohio that depend heavily on the automotive industry have been impacted by the downturn in the economy, the report shows.

San Antonio is home to Randolph Air Force Base, Fort Sam Houston, Lackland Air Force Base and Brooks City-Base. The 2005 Base Realignment and Closure decision alone is providing a significant economic punch to the Alamo City’s economy through the consolidation of high-paying military health care jobs and more than $2 billion worth of new construction activity.

A separate report released by The DiLuzio Group LLC outlining the impact of BRAC showed that Fort Sam Houston alone would experience a 11,500 increase of personnel. The Army post will also gain 7.9 million square feet of space. Construction activity due to BRAC alone should create 46,000 construction jobs during the course of the building programs, the DiLuzio report showed.

Copyright 2009 bizjournals.com

Materials Cost for Single-Family Construction Rising Again

The price index for materials used in single-family house construction inched up 0.1 percent in May after dropping 5.3 percent over the last seven months. The Producer Price Index (PPI) for single-family construction is calculated monthly by the Bureau of Labor Statistics from a survey of manufacturers and wholesalers.

Energy and metals rose enough to offset declining prices for plywood, lumber and gypsum products. Average May prices fell 2.4 percent for gypsum products, 2.1 percent for softwood lumber and 0.7 percent for softwood plywood.

In the past year, lumber prices dropped 36 percent, gypsum products 22 percent and plywood prices 17 percent. Further small declines are likely in the next few months, but the long price collapse is nearing an end now that housing starts have stopped declining and are set to increase steadily for several years.


The only significant price increases in May were for asphalt (at the refinery) 8.6 percent, diesel fuel 4.4 percent and concrete block 3.8 percent. Road asphalt prices have not yet caught up with the recent rise in crude oil prices, so one or more big monthly jumps are still ahead. Similarly, diesel fuel price increases are lagging crude oil price increases because of high inventories of refined products.

Generally, diesel prices will continue to rise at a 10-15 percent annual pace through next year, although prices have been steady in the month since the May price survey was done. The increase in concrete block prices is due to temporarily lean inventories. Cement prices were unchanged in May and prices declined for most other concrete products.


For the whole economy, prices increased 0.2 percent in May but were 4.7 percent below a year ago. The total construction materials index shows about the same pattern. Prices rose 0.6 percent in May but were 5.5 percent below a year ago. The recession has created enough slack to keep inflation in the 0.0-1.0 percent range for the rest of the year, but it will be more for single-family construction where spending is recovering earlier than in the rest of the economy.