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Is the Recession over in Arizona? - Real Estate Scottsdale

University of Arizona economist Marshall Vest says the recession officially ended in Arizona several months ago, although it will be months before a recovery is evident and years to repair all the damage that's been done.

Vest contends the national recession ended in May or June and the recession in Arizona ended about six months later.

Conceding he is more optimistic than other economists in the state, Vest said he believes Arizona's economy reached bottom sometime around the end of 2009 or the beginning of this year and has started growing again.

He bases that on an analysis of retail, employment, housing and income numbers as well as anecdotal information.

Although other economists are not as convinced and several indicators remain volatile, Vest said Monday he stands by his statement because he thinks he spends more time with the data than other economics. He is director of the Economic and Business Research Center at UA and for the past 30 years has headed its forecasting project.

"With the data we have currently, it looks like consumers are spending again," Vest said. "I think the economy is off and running."

In an article recently written for the UA publication Arizona's Economy, he estimated that, "It will take several more months before recovery becomes evident. Some components will continue to decline for a few more months."

To economists, recessions are technical definitions of when economies contract and expand. Economists with the National Bureau of Economic Research, a Cambridge, Mass., the group that determines the beginnings and ends of national recession, said last week that it is premature to say if or when the national recession has ended.

Vest relied on the following data to say Arizona's recession has ended and its economy has started to grow:

• The number of non-farm jobs in the state stopped falling in December and hiring announcements have increased. But Arizona still has almost 300,000 fewer jobs than it did in its August 2007 peak.

• Residential building permits bottomed out in March 2009 and have increased statewide by more than 70 percent through December, although the actual number remains small. Housing prices apparently bottomed out in June.

• After falling for three consecutive quarters, personal income stabilized in the second and third quarters of 2009.

• Retail sales statewide are growing at a 5 percent annual rate after bottoming out last June. Vest predicts they will grow 5 percent this year and 10 percent next year.

http://www.azcentral.com/business/articles/2010/04/19/20100419recession-over-arizona.html

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