The Metro-covery and the Limits of Growth Without Growth

Last week, the Bureau of Economic Analysis (BEA) reported some welcome news. Economic output (measured as GDP) increased in 304 of 366 metros areas in 2010, after mainly declining in 2009.

Some of the most dramatic growth occurred in Rustbelt metros that were hardest hit initially by the economic crisis. Elkhart-Goshen and Columbus, Indiana, for example, showed overall GDP growth of 13 and 10.1 percent respectively. The metros of the Bos-Wash Corridor led large regions, with 4.8 percent growth in greater Boston, 4.7 percent in greater New York and 3.6 percent growth in Greater D.C. in 2010. Economic growth was much slower in Sunbelt metros, which for a long time had been seen as America’s new growth magnets, drawing people, money and jobs from the moribund Frostbelt. Once the fastest growing metro in the U.S., Las Vegas’s economy continued to contract as its overall GDP sank and its real GDP in the construction industry declined by more than 20 percent, falling below its level a decade ago. The Brookings Institution’s September 2011 Metro Monitor notes that: “The metropolitan areas in Florida, California, and the Intermountain West that experienced a housing price boom followed by a housing market collapse (e.g., Boise, Fresno, Miami, Palm Bay, Riverside, Sacramento, Stockton, and Tucson) are prominent on our list of the weakest recovering areas.”