The desolate Union Station mall in Union City, a town of 20,000 near Atlanta. The mall suffered a blow when Sears, the last store still in business, announced that it would soon close its doors. Erik S. Lesser for The New York Times
When the unemployment rate rose in most states last month, it underscored the extent to which the deep recession, the anemic recovery and the lingering crisis of joblessness are beginning to reshape the nation’s economic map.
The once-booming South, which entered the recession with the lowest unemployment rate in the nation, is now struggling with some of the highest rates, recent data [ http://www.bls.gov/news.release/laus.nr0.htm ] from the Bureau of Labor Statistics show.
Several Southern states — including South Carolina, whose 11.1 percent unemployment rate is the fourth highest in the nation — have higher unemployment rates than they did a year ago. Unemployment in the South is now higher than it is in the Northeast and the Midwest, which include Rust Belt states that were struggling even before the recession.
For decades, the nation’s economic landscape consisted of a prospering Sun Belt and a struggling Rust Belt. Since the recession hit, though, that is no longer the case. Unemployment remains high across much of the country — the national rate is 9.1 percent — but the regions have recovered at different speeds.
Now, with the concentration of the highest unemployment rates in the South and the West, some economists wonder if it is an anomaly of the uneven recovery or a harbinger of things to come.
“Because the recovery is so painfully slow, people may begin to think of the trends established during the recovery as normal,” said Howard Wial, a fellow at the Brookings Institution’s Metropolitan Policy Program who recently co-wrote an economic analysis [ http://www.brookings.edu/reports/2011/0622_metro_monitor.aspx ] of the nation’s 100 largest metropolitan areas. “Will people think of Florida, California, Nevada and Arizona as more or less permanently depressed? Think of the Great Lakes as being a renaissance region? I don’t know. It’s possible.”
The West has the highest unemployment in the nation. The collapse of the housing bubble left Nevada with the highest jobless rate, 13.4 percent, followed by California with 12.1 percent. Michigan has the third-highest rate, 11.2 percent, as a result of the longstanding woes of the American auto industry.
Now, though, of the states with the 10 highest unemployment rates, six are in the South. The region, which relied heavily on manufacturing and construction, was hit hard by the downturn.
Economists offer a variety of explanations for the South’s performance. “For a long time we tended to outpace the national average with regard to economic performance, and a lot of that was driven by, for lack of a better word, development and in-migration,” said Michael Chriszt [ http://www.frbatlanta.org/research/economists/michael_chriszt.cfm ], an assistant vice president of the Federal Reserve Bank of Atlanta’s research department. “That came to an abrupt halt, and it has not picked up.”
The long cycle of “lose jobs, gain jobs, lose jobs” that kept Georgia’s unemployment rate at 10.2 percent in August — the same as it was a year earlier — is illustrated by Union City, a small city on the outskirts of Atlanta.
It suffered a blow when the last store in its darkened mall, Sears, announced that it would soon close. But the city had other irons in the fire: a few big companies were hiring, and earlier this year Dendreon, a biotech company that makes a cancer drug, opened a plant there, lured in part by state and local subsidies.
Then, this month, Dendreon said it would lay off more than 100 workers at the new plant as part of a national “restructuring.”
Union City, with a population of 20,000, now calls itself the place “Where Business Meets the World” and has been trying to lure companies by pointing out its low business taxes, various incentive programs and proximity to Hartsfield-Jackson Atlanta International Airport.
Steve Rapson, the city manager, said that the challenge there, as in much of America, has been to get employers to hire again. “It’s hard to get your mind around what can you do as a city to encourage future jobs and jobs growth,” he said.
The reordering of the nation’s economic fortunes can be seen in the Brookings analysis, which found that many auto-producing metropolitan areas in the Great Lakes states are seeing modest gains in manufacturing that are helping them recover from their deep slump, while Sun Belt and Western states with sharp drops in home values are still suffering. The areas that have been hurt the least since the recession, the study said, rely on government, education or energy production. Places that were less buoyed by the housing bubble were less harmed when it burst.
In Pennsylvania, the analysis found, the Pittsburgh area — which is heavily reliant on education and health care — is weathering the downturn better than the Philadelphia area. In New York, areas around long-struggling upstate cities like Buffalo and Rochester are recovering faster by some measures than the New York City metropolitan area. And the rate of recovery in Rust Belt areas around Youngstown and Akron, two Ohio cities that were hit hard, has outpaced that of former boomtowns like Colorado Springs and Tucson.
In a sign of how severe the downturn has been, the Brookings analysis found that only 16 of the nation’s 100 largest metropolitan areas have regained more than half of the jobs they lost during the recession.
The toll on the nation’s millions of unemployed people has been harsh, with the Census Bureau reporting that the United States had more people living in poverty last year than in any year since it began keeping records half a century ago.
Joblessness is taking a toll on states, too. This month, 27 states will have to pay $1.2 billion to the federal government in interest on the $37.5 billion that they borrowed in recent years to keep paying unemployment benefits.
What is most striking about the high unemployment rates, several economists said in interviews, is how they continue to afflict wide parts of the country.
“It just seems to be so pervasive across the country — except for the breadbasket area — that it’s hard to pick out anybody who is bouncing back,” said Randall W. Eberts, the president of the W. E. Upjohn Institute for Employment Research [ http://www.upjohn.org/ ] in Michigan.
Dr. Eberts pointed to another feature of the downturn: people are much less likely to leave their jobs voluntarily. Before the recession, he said, about three million people voluntarily left their jobs each month. Now, around two million people do — leaving fewer openings for job seekers.
So what happened in South Carolina? Richard Kaglic [ http://www.richmondfed.org/research/economists/bios/kaglic_bio.cfm ], a regional economist at the Federal Reserve Bank of Richmond, Va., said the state’s lingering troubles reflect what happened when its construction and manufacturing industries were hit hard by the recession. Mr. Kaglic, who is also a pilot, used an aviation metaphor to explain what he meant.
“If your nose is high, if you’re climbing faster and your engine cuts out, you fall farther and it takes you a longer time to recover,” he said. “The conditions we experienced in late 2008, 2009, are as close as you come to an engine-out situation in the economy.”
But Mr. Kaglic said that the recent return of manufacturing jobs was giving him hope, and that one reason for the high unemployment rate was that more people were now seeking work.
“I would look at it as our dreams are delayed,” he said, “rather than our dreams being denied.”
The basic premise of that article is that the project to expand the Panama Canal is way behind schedule primarily due to mismanagement, that they are falling further and further behind with each passing day, and this simple fact is being covered up by the Panama Canal Administration. No one in the Panamanian press is talking about this issue. I'm the only one reporting on it. After the publication of that article I was approached by others with additional inside information who basically validated and confirmed what I have been hearing from other sources. They gave me more numbers and more data which was different and independent of what I have already received, but the new data and numbers confirmed, supported, and validated what I have already been told.
Bottom Line Up Front: The project to expand the Panama Canal is currently, today, right now - as of 6 December 2011 - already about one year behind schedule. Recently there was a big meeting convened of all of the primary project managers from all of the private companies involved in the project where they discussed these problems and concerns in an effort to rectify some of the key issues that are holding back progress. At this point they are supposed to have completed 28% of the total project, while in fact only 17% has been done. At this rate there is "no way in hell" the project will be ready for the target date of 15 August 2014 - the 100 year anniversary of the opening of the original Panama Canal. I asked one expert with access to insider information when the project will actually be completed and delivered, based on the rate of work being done and the actual progress being made on the ground, and he said - "I don't know, no one really does, but the one thing everyone is in agreement on is that it won't be ready by the projected date of 15 August 2014, that's for sure." As described in the earlier article, with each passing day they are falling further and further behind.
Not Being Reported - Anywhere Else: Yup. At this point I'm the lone voice in the wilderness. The public relations office of the Panama Canal Authority has not issued a single statement or report indicating that the work on the project is falling behind schedule. The Panamanian news media and press has not written or published a single article to that effect. The Panama Canal Authority issues a statement, and they repeat it, that's it. When foreign or international reporters come down here to cover the expansion of the Panama Canal, they are given access, shown the work that is being done (which is, in fact, considerable) and the progress that has been made. But so far no one is talking about the ever-slipping completion date, delays, missed targets, and incorrect projections. I suspect the administration of Ricardo Martinelli might be hoping to sit on it as long as possible, to just let the project advance and to make as much headway as possible - but the next general election will be held in May 2014. Sooner or later they are going to have to deal with this slipping of the projected completion date and delays, but so far - silence.
Copyright 2011 by Don Winner for Panama-Guide.com. Go ahead and use whatever you like as long as you credit the source. Salud.
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