As it climbs out of the Great Recession, the Miami metropolitan area ranks in the top quarter of 100 metro areas for economic growth, but falls to the bottom third for prosperity, according to a new study released by Brookings Institute on Thursday.
Brookings’ Metropolitan Policy Program released its 2017 Metro Monitor, an annual update to the program’s signature economic benchmarking tool. The report measures and ranks the performance of the nation's 100 largest metropolitan economies in three critical areas of economic development: growth, prosperity and inclusion. The 2017 update focuses on 2010-2015, a period when the nation hastened its recovery from the Great Recession, although data is also included for the 2005-2015 period.
For the period of 2010 to 2015, the Miami-Fort Lauderdale metro area showed improvement in all three areas, ranking No. 21 for growth, 23rd for inclusion and 71st for prosperity.
“Miami saw a substantial recovery from the Great Recession. It was led by a jobs recovery, particularly jobs at young firms. Entrepreneurship seems to be powering a lot of the recovery,” said Richard Shearer, one of the authors of the report, noting that the Miami area ranked 15th for job growth at young firms. “ What did not improve as much is prosperity. Miami’s productivity declined 3.5 percent. In Miami’s case the decline seems to have been brought about by a significant decline in government revenue and government spending. GMP (gross metro product) and jobs declined for the federal, state and local governments and that’s produced a significant drag on GMP growth in Miami. Utilities also showed a decline.”
A good sign for growth going forward, he said, is that young, entrepreneurial firms are growing a bit faster than jobs overall, 14.7 percent higher vs. 14.3 percent. “Miami may need to continue to invest in strategies that grow its advanced business and professional services sectors, which are really productive and seem to be driving growth in other metro areas during this period of recovery and likely going forward.”
Looking at the 10-year period, 2005-2015, the region has also seen a job recovery, which means it has recovered from the recession, but it has seen weaker GMP growth probably because of declines in government spending or revenue, he said. The data also shows that productivity and standards of living are lower in 2015 than they were in 2005, possibly because real estate and construction hasn’t recovered to where it was back then, he said. Job growth from young firms was down 9.1 percent over the longer period of time, so that has not recovered to pre-recession levels.
Nationally, according to Shearer, the 2017 Metro Monitor’s Inclusive Growth Index found that:
▪ Despite a jobs recovery from the Great Recession, a lot of place ares struggling to extend the benefits of a recovery to all people in a metro area. “Most areas still faced gaps between headline growth and bottom-line prosperity and inclusion. For many, a full recovery from the Great Recession remained out of reach,” the report said.
▪ Recoveries in Florida, Georgia and North Carolina have been driven by the same sectors that drove their booms – retail, hospitality and construction.
▪ Metropolitan areas with robust advanced industry sectors such as technology and research made noticeable gains in productivity compared to peer metros with service-oriented economies, such as Miami’s.