NEWS

Fort Collins among cities on an economic upswing

Date: Apr. 27th, 2010
Contact: Paul Davidson USA Today

By almost any measure, the economic recovery is in full swing.

More factories are humming again. The stock market is roaring. Even consumers are loosening viselike grips on their wallets.  But the nascent rebound is not a massive wave that's sweeping every corner of the U.S. at the same time with equal force. Rather, it's arriving in ripples that are lifting different cities, including Fort Collins, at different times and with varying strength.

While big chunks of the Midwest and South are recovering, much of the Northeast and West are still mired in recessions that are easing in severity.  Only 41 of 135 metropolitan areas in the Northeast and West were in recovery in February, according to Moody's Economy.com. By contrast, two-thirds of the 249 metro areas in the Midwest and South were on the upswing, based on the February data, the latest available.

The regional differences can be traced to the course of the upturn. It was ignited last summer by a manufacturing revival as many types of factories ramped up production to replenish inventories that had been drawn down during the recession, said Mark Zandi, Moody's chief economist.  The surge first buoyed the nation's midsection before spreading to the Southeast. An exception is Florida, which is still reeling from the housing bust.

Perked-up factories are lifting cities with transportation and distribution centers, such as Louisville, home of UPS' air hub, where an average 226 flights depart and arrive each day.  Meanwhile, a technology boom fueled by mobile Web crazes such as the iPhone has boosted tech research and manufacturing centers such as Austin; Raleigh, N.C.; and California's Silicon Valley, Wells Fargo economist Mark Vitner said.

By fall, a comeback in professional and financial services should power the economies of larger cities such as New York, Chicago and Denver and banking hubs such as Charlotte, Zandi said. The Big Apple lost about 45,000 of its 350,000 traders, brokers and other finance workers in the downturn, but Wall Street firms such as JPMorgan Chase said they will increase hiring substantially this year.

Zandi said it could take about a year for states hurt most in the housing downturn - particularly California, Florida, Arizona and Nevada - to work through distressed housing inventory and start recovering.  But even within states, the recovery is not monolithic. Most of Maryland is still in a moderating recession, but Bethesda - a suburb of Washington, D.C. - is rebounding, thanks to steady federal employment and a health-care boom that's lifting its medical research facilities. And tech mecca San Jose is defying California's broader troubles.

Small cities, which have a disproportionate share of factories, hospitals and universities, are more likely than large ones to be in growth mode.  The economy in Fort Collins is swinging back, supported by the region's largest employer - CSU - and a steady stream of college students, cutting-edge "green" companies and federal research dollars.  Sales-tax collections are ticking up, residential and commercial construction is more than double the 2009 level, and new restaurants are opening.

Barista Annie Franz said she sees it in the paycheck from her new job at the restaurant Snooze after five months of unemployment. Her boss, Adam Schlegel, said he sees it in the "vibrancy" of the customers packing the new eatery.

And Abound Solar spokesman Mark Chen said he sees it in the eyes of the 210 employees his company has hired since the end of 2008 to make low-cost, high-efficiency photovoltaic panels.

Moody's Economy.com classifies Fort Collins as one of about 200 metro areas nationwide in economic recovery. Moody's cites the city's skilled work force, relatively lower business costs and an emphasis on "innovation and budding solar energy." Other strengths include the presence of Colorado State University's roughly 6,100 employees, 25,000 students and $312 million in annual research spending.

"There's a mind-set of, 'How can we be cutting edge?' " Gov. Bill Ritter said of Fort Collins, Colorado's fifth-largest city. "It's a creative class that is spawned by the work that's happening at CSU.

CSU President Tony Frank said Fort Collins' reputation helps the university attract high-quality faculty and students, who then bolster the area's economy through their spending.  "Whatever we do that helps the community really comes back to us as an investment in Colorado State," he said. "It's a very symbiotic relationship."

CSU spun off Abound in January 2007 after professor W.S. Sampath discovered a new way to make solar panels. The Fort Collins company now employs more than 360 people.

Fort Collins increased clean-energy jobs by about 36 percent from the second quarter of 2006 to the second quarter of 2009, city CFO Mike Freeman said. Those 827 new jobs partly resulted from public-private partnerships created to lure investment in clean-energy startups, he said.

Schlegel said he and his brother, Jon, decided to open the third location for their Denver-based restaurants in Fort Collins after seeing the city's "magical" Old Town area and meeting area residents. They hired about 30 workers and opened in mid-April, Schlegel said.

Franz, the barista, said losing her job marketing high-end yoga apparel in Denver in October led to many "frustrating" days but that snagging a job in Fort Collins improved her fortunes. She started her new job April 1.  "I feel like I'm part of a community again," she said. "I'm active. I'm meeting new people. And I'm making money."

CSU President Tony Frank said Fort Collins' reputation helps the university attract high-quality faculty and students, who then bolster the area's economy through their spending.  "Whatever we do that helps the community really comes back to us as an investment in Colorado State," he said. "It's a very symbiotic relationship."

CSU spun off Abound in January 2007 after professor W.S. Sampath discovered a new way to make solar panels. The Fort Collins company now employs more than 360 people.

Fort Collins increased clean-energy jobs by about 36 percent from the second quarter of 2006 to the second quarter of 2009, city CFO Mike Freeman said. Those 827 new jobs partly resulted from public-private partnerships created to lure investment in clean-energy startups, he said.

Schlegel said he and his brother, Jon, decided to open the third location for their Denver-based restaurants in Fort Collins after seeing the city's "magical" Old Town area and meeting area residents. They hired about 30 workers and opened in mid-April, Schlegel said. Franz, the barista, said losing her job marketing high-end yoga apparel in Denver in October led to many "frustrating" days but that snagging a job in Fort Collins improved her fortunes. She started her new job April 1.  "I feel like I'm part of a community again," she said. "I'm active. I'm meeting new people. And I'm making money."