Toledo — Economy Growing, but Slowly
August 2015 | PDF
The first half of 2015 brought some good news for Toledo: the unemployment rate is at a ten-year low, home prices are growing at about the same rate as in the rest of the country, and the region added 2,000 jobs in 2014. Manufacturing alone added 1,700 jobs, which is important because this sector drives Toledo’s long-term growth because it sells most of its output to other regions. However, significant job losses in professional and business services and leisure and hospitality tempered the gains in manufactur¬ing and construction, making the 2014 jobs growth rate less than half that of nearby metro areas, Ohio, and the United States.
Metro Area Snapshot
|Unemployment Rate||Home Prices||Payroll Employment||Credit Card Delinquency Rates|
|June 2015||One-year change||May 2015||One-year change||December 2014 (thousands)||One-year change||2015:Q1||One-year change|
|Nearby metro average||5.0%||–1.2||$130,160||2.3%||1,149||1.9%||6.7%||–1.1|
Toledo’s unemployment rate has been falling since late 2013 and was 5.0 percent in June 2015. This is 0.3 percentage points below the national rate and 0.2 percentage points below the state’s. While the unemployment rate has been fairly stable in Ohio since late 2014, it continues to fall in Toledo, the United States, and nearby metro areas. Toledo’s unemployment rate is now at a ten-year low.
Gross Domestic Product
Toledo’s 2013 GDP per capita was 5.7 percent above pre-recession levels. This means that the metro area’s GDP per capita has recovered more quickly than in the state, nation, or the average of metro areas within 200 miles. Strong growth in manufacturing and professional services output since 2011 has helped GDP with this recovery. The metro area’s population decline has mixed effects: GDP is divided across fewer people, but industries that serve local residents, such as retail trade, have also experienced declines in output.
In December 2014, the Toledo metro area had 285,000 jobs, 0.6 percent more than at the end of 2013. This is less than half the rate of job growth seen in the United States, Ohio, and nearby metro areas. The number of jobs in the Toledo metro area in December 2014 was 4.3 percent below pre-recession levels, while both the nation and nearby metro areas have 1.7 percent more employment at the end of 2014 than they did when the recession began.
Employment Growth by Sector
Between December 2013 and December 2014 manufacturing employment grew 4.1 percent in Toledo, about double the rate it grew in the United States and Ohio over the same period. This reflects strong growth in the auto industry. In 2014, construction employment also grew about twice as fast in the metro area as it did in the state and nation. The metro area’s growth in financial activities was just behind that of Ohio and the United States, but the metro area lost jobs in the remaining sectors while they grew in the state and nation.
Relative Employment Growth
Two industrial sectors added more than 1,000 jobs in 2014 in Toledo: manufacturing (1,711 jobs) and construction (1,352 jobs). Manufacturing is the sector that drives the Toledo economy, so its strong growth is good news for the region. Trade, transportation, and utilities gained 966 jobs in 2014. The two sectors with the largest employment losses in 2014 in Toledo were professional and business services (down 870 jobs) and leisure and hospitality (down 585 jobs).
Income Per Capita
For the fourth consecutive year, Toledo’s income per capita rose in 2013. It is $386 above pre-recession levels, a larger increase than seen in the United States ($44) and nearby metro areas ($117), but about one-third as large as in Ohio ($1,063). Toledo’s gains in income per capita appear to be due to the recovery of jobs and the out-migration of retired people, who tend to have lower incomes.
At $23,236 per adult with a credit report in March 2015, the Toledo metro area’s average balance of mortgage, auto, and credit card debt continues to sit below that of Ohio, nearby metro areas, and especially the United States. This is largely due the metro area having relatively low home prices, which keep mortgage balances low. The metro area’s decline in typical debt balance since the recovery began (23 percent) is a little larger than that of the nation (20 percent) and Ohio (21 percent).
Credit Card Delinquency Rates
Though the nation’s credit card delinquency rate has been steadily falling since the end of 2010, it rose from June 2012 to June 2013 in Toledo and, to a lesser extent, in Ohio and nearby metros. After having been below the US rate since at least 2000, Toledo’s March 2015 credit card delinquency rate is the same as the nation’s, with 7.5 percent of credit card balances delinquent. Delinquency rates have been fairly stable since the last quarter of 2014.
Toledo’s average home price was 1.4 percent higher in May 2015 than in May 2014. Since the beginning of 2014, the metro area’s house prices have been rising at about the same rate as in the United States, Ohio, and nearby metro areas. Home price appreciation slowed in all four areas in 2014.
Though quite volatile, it appears that single-family building permits fell during the first half of 2015 in Ohio and Toledo, while increasing in nearby metro areas and the United States. In all four areas, permits remain well below their peak during the housing boom of 2005 and 2006.
|Toledo metro area||United States|
|2013||Change from 2009||2013||Change from 2009|
|Adults with less than a high school diploma||11.3%||−1.1%||13.4%||−1.3%|
|Adults with an undergraduate degree or higher||24.8%||+2.7%||29.6%||+1.7%|
|Median age (years)||37.2||−0.2 years||37.5||+0.7 years|
|Median household income||$43,836||−0.9%||$53,524||−4.2%|
Sources: American Community Survey; Bureau of Economic Analysis; Census population estimates.
Demographics and Education
According to 2014 Census estimates, Toledo is the 91st largest of the 381 statistical areas in the United States, down from 89th largest in 2013. The share of adults over 25 with a bachelor’s degree is higher in the nation than the metro area, but from 2009 to 2013 it increased faster in the metro area.