Empty home on Bloomington Ave., South Minneapolis. Photo by Andrew Ciscel
Behind the bleak national statistics on unemployment, jobs, housing prices, and other economic indicators, are hundreds of urban areas facing unique challenges.
Intuitively, we all know the economy in the Twin Cities is different from that of Seattle, Charlotte, or Detroit. But how different are they? And where are funds (public and private) best invested to address the needs specific to this metro area?
The Brookings Institution’s Metropolitan Policy Program recently issued the first in a series of quarterly reports looking at key economic indicators across the country’s 100 largest metro areas. Collectively, these 100 areas contain two-thirds of the nation’s jobs, and generate three-quarters of GDP. Combined they are the engines of growth from which the eventual “green shoots” of recovery will spring.
The Brookings researchers examined the following indicators: employment; the unemployment rate; wages; gross metropolitan product (GMP); housing prices; and real estate-owned properties; and ranked each metro area on each of these indicators, from 1 (strongest performing) to 100 (weakest performing).
How do the Twin Cities stack up? Average or slightly worse — in the 50s and 60s – for most indicators. But for real estate-owned properties (REOs), defined as “foreclosed properties that fail to sell at auction and thus become owned by the lending institution, shown as the share of all mortgageable properties in each metro area,” the Twin Cities ranks 92 out of 100. (Remember, low scores are good, high scores are bad.) For every 1,000 mortgageable properties in the Twin Cities, 7.63 are REOs.
Things are worse — much worse – in places like Las Vegas, NV, Riverside, CA, and Modesto, CA, which are at the absolute bottom of the list, and where there about twice as many REOs as in the Twin Cities. But those cities are also at the bottom on indicators like the unemployment rate and declining housing prices.
The Brookings researchers classify the Twin Cities as similar to cities like Atlanta and Washington that are “somewhat healthier economically, but that experienced significant exurban expansion in recent years.”
What’s most striking to me about this report is how to interpret it in the context of MCF’s new research on the outlook for grantmaking for the remainder of 2009. In Special Update: 2009 Outlook Report, the specific services related to the downturn that Minnesota grantmakers say they are most likely to support are basic skills education and job readiness skills; food assistance; and emergency housing assistance/homeless shelters.
The services grantmakers say they are least likely to support? Financial assistance with mortgage payments; assistance with heating or utilities bills; credit counseling; and homeownership education or foreclosure avoidance education.
Does this mean grantmakers shouldn’t be putting resources into food assistance or job readiness skills? Of course not. There are clearly defined needs in these areas. And it’s not like there are no foundations doing work related to foreclosures.
The McKnight Foundation, an MCF member, is actively engaged in helping to stabilize communities affected by foreclosure. So is the Pohlad Family Foundation, another MCF member.
So the question is then, how should we interpret the findings from each of these research reports?
Join the Conversation: If you are a foundation trustee or staff member, have you actively made the decision recently to fund or not fund foreclosure-related programming? What information informed your final choice?
- Juliana Tillema, MCF research manager
In July and August, the Women’s Foundation of Minnesota will hold grants information sessions to publicize its funding opportunities.
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