Metro Economic Outlook: Phoenix
Economic growth in the Phoenix region may never
Unemployment rate return to the level experienced in the mid-2000s, when a housing market boom rapidly drove up the area’s population and job creation.
12
10
8
“We’re experiencing growth, but it’s slower than what we’ve had in the past,” said Jennifer Mellor, vice president of economic development for the Greater
Phoenix Chamber of Commerce. “If you look back to the mid-2000s, people were coming here in droves and the economy was growing at a rapid rate. Housing prices were way up, and unemployment was very low.
6
4.6
4.1
4
2
0
U.S. Phoenix Metro
“A lot of that boom was related to the talent that
Source: U.S. Bureau of Labor Statistics (November 2016) moved into our community. Now, we’re seeing the reverse. A business-led boom is driving our growth.”
Leading the way in that expansion is California-based
Lucid Motors, which announced in November 2016 that it would build a $700 million facility in the Phoenix suburb of Casa Grande. Lucid will create an electric car manufacturing operation that will eventually bring more than 2,000 new jobs to the region by 2022. Development at the site is expected to begin in mid-2017.
PHOENIX METRO: VITAL STATS
Total working age population: 2,656,798 out of a total population of 4,574,531
Number of households: 1,608,722
Consumer price index: 129.103 (goods and services that cost $100 in 2001 cost $129.10 in 1st half of 2016)
Percentage of local residents with bachelor’s degrees: 18.9
Elsewhere, insurer State Farm established a new, $700 million regional division in Tempe in 2016 that will eventually create 1,000 new jobs.
With graduate or professional degrees: 10.5
Student concentration: 59.6 college students per
1,000 residents
General Motors opened an information technology center in Chandler in the summer of 2014 with 500 new jobs; it expects to create another 500 jobs there by 2019. Accolade, a health care consumer services
Sources: U.S. Census Bureau (2015), U.S. Bureau of Labor
Statistics (1st half of 2016), American Institute for Economic
Research (2012)
Last updated on 1/1/2017 Unemployment and most CPI data updated monthly. Other data updated once annually as it becomes available. company, created a division in Scottsdale in 2014 and plans to hire 300 people by
2017.
Labor force makeup
Construction
100.9
3.3
120.6
383.6
Mining and logging
Manufacturing
Trade, transportation and utilities
Information
Tech giant Apple has also revived a dormant facility it owns in Mesa. Apple closed the operation in 2014, which resulted in the loss of 38.6
172.1
331.2
289.5
210.2
65.3
Financial activities
Professional and business services
Education and health services
Leisure and hospitality
Other services
Government
231.6
Total nonfarm
1946.9
700 local jobs. But the company has since agreed to invest
$2 billion in the 02,000 2,500 500 1,000 1,500
Number in thousands
Source: U.S. Bureau of Labor Statistics (January 2016) facility and create a “command center”
Some of the local Fortune 500 companies include pet products retailer PetSmart, waste management and recycling company Republic Services, and Avnet, a distributor of electronic components and computer products. for its global networks. Apple is in the process of creating 150 jobs at the facility, which will be powered with 100 percent renewable energy.
The Phoenix metro area covers two counties in south central Arizona. The region’s economy is a haven for small business – of the 126,000 businesses in the metro region, 96 percent have 50 or fewer employees.
Even with the recent private sector growth, officials at the Phoenix chamber are concerned about filling the talent pipeline in the future. A workforce development effort has
Working age categories established focus groups among five major industries, and employers are working with higher education partners to develop curriculum and train talent at all levels, Mellor said.
246,158, 9%
306,651, 12%
269,667, 10%
20 to 24
25 to 34
“It’s not just entry-level workers,” she
35 to 44
45 to 54
55 to 59
60 to 64
647,947, 24% said. “Leadership is a problem in all of our industries. In the recession, mid-level manager positions were typically eliminated, and now employers are missing that whole layer of talent.”
583,789, 22%
602,586, 23%
Source: U.S. Census Bureau (2015)
Last updated on 1/1/2017
2Employee Benefits Data
Employers offering consumer-driven health plans
Employers in the Phoenix metro area are slightly more likely to offer consumer-driven health plans compared with the national level, by a margin of 3 percent.
30%
22%
25%
20%
15%
10%
5%
19%
0%
U.S. Phoenix Metro
Employers offering domestic partner benefits
60%
50%
40%
30%
20%
10%
0%
They are slightly less likely to offer domestic partner benefits, by a margin of 3 percent below the national average.
50%
47%
U.S. Phoenix Metro
Source: SHRM Health Care Benchmarking Database (2016)
Retirement
Employee 401(k) participation rate
80%
The rate of 401(k)
66%
70% participation in the Phoenix metro area’s workforce is lower than the national average, by a margin of 11 percent.
55%
60%
50%
40%
30%
20%
10%
0%
U.S. Phoenix Metro
Source: SHRM Retirement Welfare Benefits Database (2016)
Last updated on 1/1/2017
3Income and Turnover Data
Overall turnover rate
30%
25%
20%
15%
10%
5%
25%
The turnover rate in the Phoenix metro area’s workforce is higher than the national level, by a margin of 6 percent.
19%
0%
U.S. Phoenix Metro
Source: SHRM Human Capital Benchmarking Database (2016)
Median household income
$56,516
$55,547
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
$0
Median household income in the Phoenix metro area is nearly on par with the national level.
U.S. Phoenix Metro
Source: U.S. Census Bureau (2015)
Per capita income
$35,000
$30,000
$25,000
$20,000
$15,000
$10,000
$5,000
$0
Per capita income in the Phoenix metro region is slightly lower than the national level, by nearly
$2,000 annually.
$29,979
$28,194
U.S. Phoenix Metro
Source: U.S. Census Bureau (2015)
Last updated on 1/1/2017
4Top Management Salaries Data
Median salaries, top management
Median salaries for top management level employees in the Phoenix metro area vary when
$264,400
$322,100
*Top legal executive
Chief information officer
**Top HR executive
$322,800
$280,500 compared with national levels.
$255,000
$232,500
$277,800
*Lower Mountain states sub-region median data
*Chief financial officer
*Chief executive officer
$348,600
$512,500
$650,000
**Without labor relations experience
$0 $600,000 $800,000 $200,000 $400,000
Phoenix Metro U.S.
Source: Willis Towers Watson Data Services 2016 Survey Report on Top Management Compensation
Project lead: Joseph Coombs, Senior Analyst, Workforce Trends, SHRM
Project contributors: Shonna Waters, Ph.D., VP of Research
External contributors: Jennifer Mellor, Greater Phoenix Chamber of Commerce
Copy editing: Katya Scanlan, copy editor
This report is published by the Society for Human Resource Management (SHRM). All content is for informational purposes only and is not to be construed as a guaranteed outcome. SHRM cannot accept responsibility for any errors or omissions or any liability resulting from the use or misuse of any such information.
© 2017 Society for Human Resource Management. All rights reserved. Printed in the United States of America.
These materials and the data contained within them are copyrighted by SHRM, another copyright holder (where noted), or are government-owned. SHRM hereby grants permission for users to copy and use these materials and the data contained within them only if proper attribution is given to SHRM (or the noted copyright holder) as the source of the material.
For more information, please contact:
SHRM Research Department
1800 Duke Street, Alexandria, VA 22314, USA
Phone: (703) 548-3440 Fax: (703) 535-6432
Email: SHRMResearch@shrm.org
Web:
Last updated on 1/1/2017
5