Phoenix, AZ – A panel of economists concluded Arizona is likely to add only 40
to 50 thousand jobs in 2011. But Joel Naroff said what's also
needed for recovery is for consumers to start spending money.
(The problem is, if there's not a lot of jobs available, you
can't walk across the street and get a job. So you have job
insecurity. Job insecurity leads to lower consumer confidence,
lower consumer confidence leads to a lack of spending, slow
growth in spending means that businesses don't have to hire a
whole lot of people. That just reinforces the slow job growth.
Arizona State University economics professor Lee McPheters said
getting people to spend more is even more complicated than that.
He said consumers are deeply in debt. And they are also unsure of
the value of their retirement accounts. And then there's the fact
that home prices have declined 15 of the last 17 quarters.
(What that means for the consumer is that one of their major
assets in their family portfolio has lost value for basically the
last four years. That really affects their confidence and their
willingness, I think, to go out and spend.)
McPheters figures it will be at least mid 2013, if not later,
until the state gains back all the jobs that have been lost. For
Arizona Public Radio this is Howard Fischer.