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Upbeat signs of economic turnaround

Unemployment still troubling, but other sectors see improvement

By Julia Anderson, Libby Clark
Published: January 24, 2010, 12:00am

What a difference a quarter makes.

If Clark County’s third quarter hinted at economic recovery, there was no mistake that a recovery took hold in the last three months of 2009.

Home sales and home construction showed substantial improvement at the end of the year, both with activity up more than 40 percent from the same period in 2008.

Newcomer trends turned positive, after being down in the prior quarter, as more people moved here.

Semiconductor sales, so important to a variety of manufacturing businesses here, showed strong growth.

And Portland International Airport, among the region’s most important economic engines, saw year-over-year passenger traffic totals and cargo tonnages turn positive in December for the first time in 16 straight months.

“Considering that the end of 2008 was when we fell off the cliff, fourth quarter 2009 wasn’t that bad,” said Scott Bailey, economist and labor analyst for the Washington Employment Security Department.

But while many indicators are positive from a year ago, employment remained in the doldrums with job creation lagging layoffs. Clark County’s December unemployment rate estimated at 14.3 percent was the highest for that month since 1980. So until the employment picture improves, it’s no surprise we still feel skittish about the economy.

In his latest “Businomics Newsletter,” Portland economist Bill Conerly noted that U.S. manufacturing is rapidly expanding and that initial claims for unemployment are declining. Retailing, hard hit by the economic downturn, is recovering.

“Those who panicked and sold their stock holdings in February (2009) are now sorry,” Conerly said. It’s the stock market — a leading indicator for the economy — that headed higher in the second half of 2009.

Conerly expects manufacturing in Oregon and Washington to show some recovery in 2010. Mortgage rates will rise, but not by much in terms of historical standards. Clark County Realtors agree that the local housing market appears to have hit bottom last summer and is now coming to life.

Tech’s direction

Economists and semiconductor analysts this month agreed that the economy is on the rebound and the chip industry is poised for “strong growth,” according to SEMI, an association for the semiconductor manufacturing supply chain.

Global semiconductor sales reached positive territory for the first time in November in nearly two years when compared to the same month a year ago, the Semiconductor Industry Association reported this month. Sales rose to $22.6 billion in November, up 3.7 percent from October and 8.5 percent from November 2008.

Global chip sales also indicate a rebound for Clark County’s semiconductor “cluster” zone, with several local employers related to the chip business including SEH America and WaferTech. Taiwan Semiconductor Manufacturing Co., which operates the WaferTech chip foundry in Camas, reported December sales more than doubled the same month a year ago.

But for all the turnaround news, the local jobs picture remains weak as employers remain reluctant to bring on new workers. As a result, home foreclosures will likely remain high and bankruptcies, as a reflection of layoffs across most sectors, will stay high, up some 30 percent over 2009.

Unclear is what it will take to give employers more confidence, and when that might happen.

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