St. Louis Employment Analysis

The St. Louis area has been an economic hub for transportation and shipping for nearly two centuries.  Its location in the center of the US on the Mississippi river gives it some unique geographical and strategic advantages.  Scott Air Force Base is located here as well as numerous Fortune 500 companies’ headquarters.  St. Louis has also traditionally been the home of many of the manufacturing plants for the US auto industry, although recently these plants have closed and the manufacturing sector of St. Louis has taken it on the chin.  Not only has the manufacturing sector really been hurt, but all other sectors save two have shed jobs by the thousands.

For the first time since the early 1980’s, St. Louis’ unemployment rate is sitting at about 10%.  There is little wonder just how the rate got so high in the first place, given the massive job cuts and layoffs experienced in nearly every employment sector since the beginning of the recession.  Only the education and health services sectors have added jobs over the past 24 months, and much of these have been out of necessity from the growth in the general population.  This city is not a very promising place for someone looking to relocate for work.

The unemployment figures are likely higher, since the 10% unemployment rate does not take into account those workers no longer looking for work or those who no longer qualify for government unemployment assistance.  The real rate may be as high as 20% in St. Louis, given that the manufacturing and retail sectors have been decimated as of late.  The construction sector has lost nearly one in eight jobs in 2009 alone, not to mention all the jobs that were shed immediately following the economic decline at the start of the recession.

The American Recovery and Reinvestment Act started may programs in St. Louis to try and keep unemployment numbers as low as possible for as long as possible.  But most of the workers hired in these programs are seasonal or part time workers, and therefore are underemployed or not given any real opportunity at long term work or a career.  Without any real improvement in the unemployment numbers, St. Louis will be without an economic recovery.  The city has not been able to attract enough attention from start-ups and small businesses to have them relocate to the area and help to diversify and freshen up the economic landscape.

St. Louis’ real estate markets have contracted rather severely in reaction to the bursting of the real estate bubble in 2007.  The market still likely has quite a ways to fall and won’t stabilize until the surrounding economy does so first.  The lack of blue collar and unskilled worker jobs is killing the city’s economy.  The lack of economic diversity, coupled with the fact that trade and commerce, both international and domestic, have slowed considerably, and you have a recipe for high unemployment with little or no hope for short or even mid term recovery.