A team of television reporters spent some time in Charlotte this month posing a question that might be uncomfortable to consider.
The team, from the award-winning PBS show "Frontline," spent about two weeks talking to Charlotte's community and business leaders. Among the larger questions it asked, the Squeeze hears, is this: How does Charlotte reimagine its economic future?
That presumes that there's some reimagining to do, given that we have gone from two bank headquarters to one - with that one, Bank of America, hobbled by the credit crisis.
Has the local economy been irrevocably changed by the recession? We went to the economist who looks closest at the city and the region, UNC Charlotte's John Connaughton.
Are Charlotte's days as a boomtown over?
"No," he says. "That's crazy. I think we'll have more people employed in the financial, insurance and real estate industries in five years than we do today."
More? Here's why: When Connaughton does some reimagining, he looks at a city not with a weakened banking spine, but one with more financial power.
"I don't think people realize how the financial industry is going to change," he says. "It's going to be a lot of power concentrated in a few firms."
Yes, he acknowledges, one of those firms - Wells Fargo - took over Charlotte-based Wachovia, but he notes that significant regional operations - the Eastern U.S. - will remain here. "If it's a better-run bank, it could be better for us overall," Connaughton says.
And BofA? "It's going to be a giant. We'll have four firms conducting 60 percent of business in the U.S., and one of those - maybe the largest - is Bank of America."
And if all this rosiness doesn't take root? Connaughton, who was not interviewed for "Frontline," cautions against what he and other business leaders see as a common mistake outsiders make - thinking that our growth is entirely bank-driven.
About five years ago, UNCC studied how Charlotte grew - both in population and income - in the 1970s, '80s and '90s. The result was startling: The city's real income growth was almost identical for each of the three decades.
"The banking industry really didn't start to take off until the late 1980s," Connaughton says. "So most of the growth in the past has been basically driven by economic growth in the rest of the community, as well."
No word on when "Frontline's" Charlotte report might air, or what conclusions the team has drawn. A producer from the show has not returned a message from the Observer. (Update: the show's director will be calling today.) But two weeks signals an impressive effort to get to know the city, so we shouldn't assume a boomtown-gone-bad angle.
We also shouldn't assume good days immediately ahead here, either, not with more banking jobs likely leaving us soon. "It's going to be tough," Connaughton says.
But: "With so much that's left here, I see Charlotte in a great position."
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28 comments:
What a stupid show. Didn't they just do a show in 2007 about how Charlotte was booming? The negative media is this country's worst enemy. How are we suppose to get out of a recession with these stupid people constantly running negative, BS news and shows like "Charlotte's boomtown days are over??????"
Charlotte was just named one of the best metro areas to do business, North Caroline was just named one of the best states to do business, Charlotte metro area is still in the top 10 fastest growing and North Carolina is up in the top 5 fastest growing states. Jobs will continue to come here because it is cheap and there is a large, educated workforce to choose from. People will continue to move here for several reasons most of us already know.
People think Charlotte just has the banks and that's it. We also have several other Fortune 500 companies headquartered here other than banks. In the long run, Charlotte will benefit from this mess because it's economy will be more diversified.
I grew up in Houston, a massive city that began it's growth boom in the late 60s and hasn't stopped yet. However, it did have a big hiccup during the oil crisisof the 70s. The city was tied to oil, as Charlotte is to finance. Once Houston began to diversify it's economy, it flourished. Charlotte needs to learn that lesson of too many eggs in one basket. What a great city this is, and should continue to be.
Not to answer a question with a question, but is Charlotte really 'cheap'?
I agree the negative spin is certainly not helping things....but sadly for us, it's newsworthy and something to talk about.
Speaking of the negative media, exactly how many times is this story going to be reported? We know about this already. We've read about this at least two other times on this site in the past month. I'm sure there is more news out there somewhere.
I agree with anon@8:21 but would like to interject with this tidbit. The media operates in extremes because moderate headlines don't draw readers (case in point, this article).
Once the economy starts to show the slightest improvement, they'll start talking up the economy with grandiose adjectives like "skyrocketing" or "soaring". Then the lemmings who make their decisions based on the media will flock back.
Its a cycle that repeats over and over again. Entertaining though.
Good, let them all think that we are doomed. Maybe it will slow people moving here a little over the next few ears so we can get out of this recession. The last thing we need is more unemployment. I live uptown and while I am not happy that this mess hit just when uptown was slated to explode with development it may also be a good thing. Currently only one condo building is being built. I don't see them starting another one for 2 years and it takes about another 2 years to complete one. So that gives us some time to absorb the current units. I've noticed that some units are moving but it seems to be the best units with the best views and for not much more than we paid pre-construction a few years back. As long as we keep holding steady and don't go into the negative then that's all I can ask for during these times.
Charlotte will bounce back soon.
@9:17 - What you described that you want equates with the end of a Boomtown.
This is a misconception. Charlotte was never a real boomtown but has grown like the entire south has grown for many decades. The city has been around since 1762.
Within the next 30-50 yrs there will be another 100 million more transplants to go with the 50 million already here migrating to the entire south as big northern city-metros pretty much empty out to cities like Charlotte, Raleigh, Nashville, Jax, Greensboro, Winston, Va Beach, Memphis, Tampa, Orlando, etc. Bigger southern cities like Dallas, Houston, Miami, Atlanta will keep growing but at a slower pace to the mid size cities like Charlotte.
This is not due to boomtown but the continued deterioration of large northern cities and massive shift of the mostly white European American population shift southward to the milder southern climatic region.
The real boom is the more mild liveable climate in the entire south that will always be the same regardless of the economic conditions.
Ah yes- it's the fault of the media and bloggers reporting on reality that is causing our economy to collapse, not the fault of the companies that took on insane risks so that their executives could get massive bonuses before the bottom fell out.
If we all just close our eyes, think positive thoughts, then our economy will be magically OK !
Anyone who says the media is the reason our economy collapsed shows such a complete lack of intelligence that they need to be slapped in the head with a fish.
"I don't think people realize how the financial industry is going to change," he says. "It's going to be a lot of power concentrated in a few firms."
Exactly why banks need to be broken up. Many are already deemed "too big to fail" increasing their size only leverages their corrupt influence in our government. It will take many years to realize but we are in a depression and possibly in a worse situation than the great depression. We are already too globally connected as it is. In the 30's we were no where near the global economy we are today. Unfortunately there won't be any countries wealthy enough to start a WWIII to bring the world out of this depression. Is Charlotte's days as a boomtown over? Wrong question. Is the US and subsequently the worlds days as a boomtown over? Absolutely. The next 10 to 20 years will be a period of negative to well below average growth for the world, not just Charlotte.
Don't believe me? The banks have counted on housing growth and 401k contributions to fund their ability to leverage. Ever bought a house or contributed to your 401k while your unemployed? 10% of the country is oficially unemployed, probably more like 15% if you count those who have maxed out their benefits. Most others can barely pay their bills. Where do you think funding for bank expansion is going to come from? Other bankers?
"Within the next 30-50 yrs there will be another 100 million more transplants to go with the 50 million already here migrating to the entire south as big northern city-metros pretty much empty out"
Thanks for the laugh. For some reason I have difficulty believing that NY, Philly, DC, Boston are all going to be pretty much "emptied out" in 30 years. If you think that 100 million people will be transplanting to Charlotte and other mid-size Southern cities, you're living in a dream world. The infrastructure just doesn't currently exist to support that much of an influx.
Yes, people will continue to move down here from the North, but those cites are far from emptying out like some of you like to believe. There are still a lot more people up there than you think. The carolinas are still much more welcoming to newcomers than many parts of the country, and the cost of living is still significantly cheaper than most areas, so we are not dying anytime soon. I heard these same arguments in 1991 & 2001 when we were having recessions, yet everything bounced back a year or two later. Yes, there will be some adjustments on how we do things compared to the last five years, but we are still moving forward.
Maybe we should first agree what "boomtown" means. If you think Wells and BOA will go back to paying their employees what they made just last year, you are mistaken. So yes, the days of high flying investment bankers awash in money are OVER. But maybe the days of reasonable expectations of sound, sustainable growth are on its way once again. How many $1,000,000+ houses can Charlotte support on banking alone?
The thing about Charlotte is that a lot of transplants are realizing that Charlotte is not what it was hyped up to be. Charlotte is in fact rather depressed. The natives have a complacent approach that allows for rampant corruption and fraud, they defend the fraudsters while pounding the righteous to the ground. Just look at the North Carolina State Attorney's Office! How come the New York's State Attorney is the one always filing cases against Bank of America when Bank of America is based in North Carolina?
Why? Because North Carolina and predominantly Charlotte, are still places where the 'good 'ole boys' club' is still in control.
Those days are over and people have realized that Charlotte and North Carolina as a whole should be avoided unless you are a fraudster that wants to prosper under our complacent atmosphere.
Don't know if Charlotte's boomtown days are over but the "upper $600,000" per house gated plantation development up the street seems to have had it's fancy water fountain turned off with weeds growing and no building activity.
^
Agreed.
If I had to do it all over again - I would have stayed in Boston. At least there are a lot more employers in the financial services industry from which to choose. If you are in the financial services industry, and moved here for a bank job, then that is indeed all that is here for you. And it's dying all around us.
Huh...? Charlotte is not about just Charlotte anymore. Most of your Major growth will be taking place in counties like Rowan, Cabarrus, and Stanly. What you have never heard of Stanly... Well you will soon because it has one of the last major undeveloped lake systems in this part of the country. Also, the county beside it is about to get one of the bigger instates in this part of the country. Charlotte will go from a City to a Mjor Meto in the next two decades (Think Atlanta or Baltimore).
Gallup called last night to hear what I think about Charlotte. Now I know why.
I don't believe that the city, state, country, and/or world is sinking in a huge pile of economic catastophe for as far as the eye can see. That's doomsday BS and not supported by anything but hype at this point. The economic contractions we saw in the last six months has already slowed, stabilized, and even reversed in some industries (but don't expect anyone to point them out while the other industries still flounder). If you know where to put your money, now is the time.
But as for Charlotte, as long as it remains one of the more progressive southern cities it will continue to draw skilled labor from the north and grow, otherwise the growth will stop and the mega-corps we're famous for will quickly ship out most of their jobs to higher cost of living locations. We have two things beyond weather that attract people and jobs; perceived growth and low cost of living. And they are both dependent on this city maintaining a 'transplant colony' image and moving away from the country-style city image. Nobody with skills wants to move to hickville.
I would like to see our city's boom slow down so we can concentrate on smart growth instead of what has been going on since they early 90s: growing as fast as possible with little or no consideration on our neighborhoods and environments.
I always thought it was tough finding a good job in Charlotte. I moved here in 2000 and was sweating bullets to find employment. I am a seasoned admin. assistant. The market is over-saturated. From my perspective Charlotte never was a "boomtown".
I don't know if it's over, I'd like to see more focus on companies other than banks. I'm in the financial services industry and that is all anybody talks about. (Maybe because I work within it, I don't know). I like the new growth in Biotech I believe it is, Cannon Mills area. There are a lot of skilled people here, but everyone can't work for one of the banks. I don't think negative media attention is enough to doom us. I've started saving more and spending less because I don't know what is going to happen with my full time job. My part time job used to be for extra money and now it helps make the ends meet. I don't intend to leave Charlotte.
But no matter what happens, Charlotte's always going to be V-A-N-I-L-L-A. Snooze.
Boomtown seems a bit extreme whether you hold a positive or negative opinion; the evidence of Charlotte's current situation will be all around you driving home this afternoon...look around...there are always out of state license plates but the last few weeks have seen a dramatic upswing in the proliferation of Ohio, NY, NJ, and PA plates here. Things are bad there and the lemmings are coming faster. To all of you, please go back so we can stabilize ourselves here; you only contribute to the problem
If they all went back north it would surely turn back to weeds it once was. Maybe a pile of cow dung......
Yea the big cities in the north long been dwindled down. It was called white flight to the burbs 50yrs ago. Now its called getting the hell out of Dodge and going south. You used to go to California on Route 66 and start over with a clean slate but those days long gone and Arizonas too hot. Californias losing all its white pop to Nevada and Oregon.
There is a major population shift southward for sure that will continue for many decades to come.
Charlotte is a great city. Look there is more than banking here. This city is a major hub for transportation companies, distibution centers, technology, and many other industries.
Do you work for the chamber?
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