NEO MIRRORING U.S. IN CURRENT RECESSION
Team NEO Report Indicates Diversifying Industries Positively Impacting Economy
CLEVELAND, January 18, 2010 — Northeast Ohio is trending closer to the U.S. in this current recession than in the 1981 recession, according to the most recent edition of Team NEO’s quarterly Cleveland Plus® Economic Review released today. Compared to the 1981 major recession in which Northeast Ohio significantly lagged behind the U.S. in employment and GRP, these indicators in the 16-county Cleveland Plus region of Northeast Ohio are trending closer to U.S. averages in this recession. The Review indicates that this change is likely due to Northeast Ohio’s change in industry mix. Nearly 30% of the region’s GRP depended on the manufacturing industry in 1981, compared with 12% today. Today, the Cleveland Plus region’s economy is more diversified with increases in Healthcare, Headquarters, Professional, Scientific and Technical Services, and other industries. Specifically, the report indicates:
• Northeast Ohio is performing Similar to the U.S. in this Recession
o In the 1981 recession, Northeast Ohio’s employment and GRP rate dropped much more sharply than the U.S.; today’s recession is trending much closer
• Shift in Industry Mix Positively Affecting GRP and Employment
o During 1981 recession, Manufacturing accounted for 28% of employment; today it represents 12%
o Diversified mix and shift to higher growth industries may be positively impacting NEO economic stability in this recession
o NEO Biomedical industry has grown by 37% in the last 5 years, outpacing U.S.
o NEO Professional, Scientific and Technical Services has grown 79% in the past 15 years with Scientific Research and Development growth doubling U.S.
o NEO Aerospace-Related Industry has grown by 59% in the last 15 years
• Cleveland Plus Workforce Transitioning
o Since 1981, individuals with some college education have increased about 120%
o Individuals with bachelor’s or an advanced degree have increased by nearly 75%
In addition, every issue of Team NEO’s quarterly Cleveland Plus® Economic Review provides updates of basic economic indicators for the 16-county economy including: current estimates of the region’s annual growth rate, as defined by Gross Regional Product (GRP), and up-to-date information regarding Northeast Ohio’s total employment rate. This quarterly report also looks at the Industrial real estate landscape. The following is a summary of the findings:
• Ongoing soft economy reflected in GRP Revisions and Projections
o GRP for the region in 2009 is estimated to show a decline of 5%
• Northeast Ohio Employment Up Slightly
o Typical growth from Q2 to Q3 was realized, while less than normal, Northeast Ohio still saw employment increase by approx. 3,000 jobs
o Total employment down 5% from Q3 2008
• NEO Unemployment Rate Declines Slightly
• Demand for industrial space remains strong
o Vacancy rate stable at 7.6% despite current economic downturn
Team NEO publishes the Cleveland Plus Economic Review quarterly to provide a holistic picture of Northeast Ohio’s economy. It is the only regular source of collective economic data for the 16-county region. The non-profit organization uses the information to attract businesses worldwide to the Cleveland Plus region.
Team NEO advances Northeast Ohio’s economy by attracting businesses worldwide to the 16-county Cleveland Plus region. The organization is a joint venture of the region's largest metro chambers of commerce. Since 2007, the organization has attracted 29 new companies, more than 3,100 new jobs and $95M in annual payroll to Northeast Ohio, leading to a total annual regional payroll benefit of $260M.