The poor economic conditions for most of 2009 were reflected in the first-ever decline in the revenue of the Top 100 Firms, primarily as a result of the size of the losses experienced by the Big Four. Local and regional firms as a group, however, for the most part showed modest growth. With the exception of the Mountain region, all of the regions posted modest gains for the year.
The U.S. economy suffered "the deepest and most protracted recession since the Great Depression," according to the Joint Economic Committee. The financial crisis had enduring effects on economic performance throughout 2009. While growth, as measured by inflation-adjusted gross domestic product (real GDP), turned positive in the third quarter of 2009 following four consecutive quarters of decline, significant risks to the economy remain.
The region began the year with two states, Michigan and Ohio, registering among the largest over-the-month percentage decreases in employment, according to the Bureau of Labor Statistics. Regional and state unemployment was either unchanged or higher throughout most of the year. Likewise, the Federal Reserve District corresponding to the region noted reduced activity across a wide range of industries, with exceptions in some sectors.
At mid-year, the Cleveland District noted that cargo volumes remained below the levels of the previous year, while the Chicago District indicated that the resolutions of the Chrysler and GM bankruptcies had boosted confidence. However, ongoing shutdowns of auto plants led to low business volumes for parts suppliers. At year's end, conditions had improved modestly, with non-automobile sales up in the Cleveland District and steady in the Chicago District. Vehicle sales were up in Chicago, while remaining flat or mixed in Cleveland.
GULF COAST and SOUTHEAST
Along with the rest of the country, the Gulf Coast and the Southeast experienced rising unemployment during the year. While most districts reported stabilization or modest improvement toward the end of the year, the Federal Reserve District most closely corresponding to the Gulf Coast reported continued downward trends in new vehicle sales, transportation services and manufacturing production.
Unemployment rates at year's end for the states comprising the Southeast ranged from 6 percent in Virginia to 10.4 percent in South Carolina. All were below the national average except South Carolina. The Richmond Federal Reserve District reported strength in health services toward year's end, but manufacturing activity had leveled off. Tighter credit was said to limit the ability of customers to place new orders.
The states comprising the Midwest had the lowest jobless rate at year's end, at 7.3 percent. Both the Kansas City and Minneapolis Districts noted modest increases in manufacturing activity, and both districts reported improvement in the information technology industry. Moreover, both districts expected business conditions to improve in the coming months.
While below the national average in job losses, the Mountain states suffered significant increases in unemployment rates from December 2008 to December 2009: Colorado moved from 5.8 percent to 7.5 percent; Idaho from 6.1 percent to 9.1 percent; Montana from 5 percent to 6.7 percent; Utah from 4.1 to 6.7 percent; and Wyoming from 3.2 to 7.5 percent.
Rhode Island recorded the third highest unemployment rate at year's end, at 12.9 percent. Connecticut and Massachusetts, at 8.9 and 9.4 percent, respectively, were just below the national average of 10 percent. Some improvement was noted in the IT industry, and manufacturers in the Boston District said that they expected business conditions to improve in the coming months. Employers reported that they were beginning to hire and reverse pay cuts or freezes that were implemented earlier in the year. However, home prices continued to decline at the end of the year.
NEW YORK CITY
Unemployment continued to increase during the year in the New York City area, with the third largest over-the-year employment decrease in the BLS metropolitan divisions (after Chicago and Los Angeles). Economically, the region experienced decline during the year, but at the end of the year the Federal Reserve reported "expectations that business conditions would improve during the months ahead."
The Mid-Atlantic states - New York, New Jersey, Pennsylvania and Maryland - recorded unemployment drops of over 2 percent during the year, but ended the year at 9 percent, 10.1 percent, 8.9 percent, and 7.5 percent, respectively, significantly below the national average. Loan demand was reported weakening at year's end, but both auto and non-auto sales were improving.
Over the year, Texas experienced the second-largest number of job losses (behind California), although it ended the year at 8.3 percent unemployment, still below the national average. Arizona and New Mexico ended the year at 9.1 and 8.3 percent unemployment, respectively.
At year's end, a pickup in both home construction and activity at staffing firms was reported by the Dallas Federal Reserve District. Moreover, Dallas noted steady to increasing oil and natural gas production within the region.
The Pacific reported the highest jobless rate at 11.7 percent in December 2009, and California had the highest number of job losses over the year. Nevertheless, at the end of the year the San Francisco District noted a slight uptick in energy extraction industry activity, as well as a pickup in non-auto sales. Home prices were said to have firmed somewhat, and increases in home sales were noted.
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