Economic Outlook Better for Austin than the Country

Standing on South Congress Avenue on a Saturday afternoon it doesn't look like the country is experiencing a deep recession. The shoppers streaming in and out of places like Uncommon Objects and Cici's Market don't come out empty-handed. There is not a parking place or bare spot on the sidewalk to be found.The line at Hey Cupcake snakes around the Airstream trailer and down Annie Street. One patron standing in line noted that as the economy has worsened the cupcake line has gotten longer. "I drive this way every day and I have definitely noticed the increase in cupcake customers. Everybody has two bucks to spend on a treat," she noted with a grin.As noted in a recent article in the Austin-American Statesman, Austin is weathering this recession better than the country as a whole. The Austin-metro area added jobs in 2008, while the national unemployment rate dropped 2 percent, a total of 2.6 million jobs.But that doesn't mean everything is rosy for Austin's economic outlook for 2009. Job growth is expected to be very small, less than 0.3 percent according to economist Angelos Angelou. Austin, like the rest of the nation, is waiting to see what will happen with the proposed stimulus package in the first few months of 2009. Job creation is high on the list of proposals by President Obama.Although large local employers like Freescale, AMD and Dell have taken measures to restructure and make cutbacks to stay afloat, not as many local businesses are expected to shut their doors as will be experienced nationwide. Car dealerships are a good example of an industry that has been hit very hard on a national level, but less so in the Austin area. According to the Freeman Auto Report, new car and truck sales dropped 30 percent nationally, but only 12 percent in Austin.Housing is another area where Austin has fared but better than other places. While commercial and residential rental occupancy rates continue to drop, home sales look promising for 2009. According to an article in the Austin-American Statesman this week, pending sales rose 11 percent in December. This bodes well for the numbers in 2009, after a steady decline of home sales through 2008. The lower interest rates for mortgages has helped home sales to rebound.New home building in Austin and the rest of the country has taken a hit in this economy. In fact, according to Angelou, Austin could face a single-family housing shortage because of the drastic drop in new home starts. If the shoppers on South Congress are any indication, the economic outlook for Austin is good. Economist Ray Perryman forecasted that Austin will add 80,000 jobs in the next five years. This job growth coupled with the continued growth of the area population will help Austin weather the tough economy that is raining doom and gloom on the rest of the nation.--Ki turned his Austin real estate hobby into a business. He built a website, which includes a free search of the Austin MLS. Potential buyers can investigate what is available in the market for free. Their site has statistics on Austin real estate and Round Rock real estate.Source:

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