Jun 30, 2017

2016 was good for Tucson’s economy, 2017 could be even better

By Bud Foster

December 26th 2016

2016 was a very good year for the Tucson economy and economists predict 2017 will be even better.

Tucson was late bouncing back from the 2007 Great Recession but has now surpassed Phoenix in the job growth rate.

Pima County is the 3rd fastest job creator in the country according to the rating agency Standard and Poor’s.

According to U of A Economist George Hammond, Tucson’s job growth was about a half a per cent this year but will exceed 1.7 percent in the coming year and tickle 2 percent after that, which means an additional 15,000 new jobs in the next two years,

Looking around town and it’s not hard to imagine those predictions are valid.

Caterpillar is already bringing hundreds of new jobs to town and it will continue in 2017.

Vector Industries, a rocket making company, will join World View as the anchors of Tucson’s tech industry.

Raytheon, the top missile maker in the world, will add 2,000 jobs in a major expansion in the same area.

Comcast and Home Goods are adding hundreds of new jobs.

Ascensus will join 40 other companies at the ever growing U of A Tech Park which now employs more than 6,500 workers.

Downtown Tucson has seen its strongest resurgence in decades. A new Marriott hotel will open in 2017, the first new hotel downtown in 40 years.

Senior Living will build nine stories of senior housing at Church and Broadway.

The Diocese will being a new housing project as well and so will HSL Properties at La Placita.

The West side of Interstate 10 on Congress will become home to two new housing projects and a retail site which will break ground this year.

Greyhound will move into its new home at Broadway and Euclid before the end of the year, paving the way for a new hotel project at Congress and I-10.

City Park, a four-story food court, business center and retail space will break ground at Congress and Stone.

While housing permits and prices rebounded early in 2016 but slowed during the last half of the year, both are expected to increase in 2017 and bringing with them an increase in construction jobs.

The Foothills Mall was recently purchased by a group of local investors and will get a makeover.

Plans are being developed for two new retail outlet complexes at Irvington and I-19, as soon as the widening construction is finished.

“At this point, all indications are looking up,” said Hammond. But there are two ominous threats which could be looming on the horizon.

Arizona’s minimum wage increases nearly $2 an hour on January 1, 2017, from $8.05 to $10 an hour and increases steadily to $12 by 2020.

Whether that will have a net positive or negative effect isn’t known yet, because it’s the largest single year increase in the minimum wage ever.

And the peso, which is a big part of the Tucson economy due to the large number of Mexicans who shop in Tucson, has been hit hard by the increasing value of the American dollar.

Whether fewer people traveled across the border to shop this Christmas and may continue to do so isn’t known yet.

But it’s worth watching in 2017.

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