PORTLAND, Ore. (KOIN) — The Portland Metro Chamber and Downtown Portland Clean & Safe released their 2024 Economic Conditions report Thursday, outlining the need to focus on attracting residents and visitors amid slowing job growth.
The report analyzed the economic outlook for the Portland metropolitan area in 2023 and examined the impact of population loss in the state.
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Researchers highlighted four key findings: a decline in job growth in Portland, a reassessment of comparable cities, better prospects for downtown pedestrian traffic and the need to spend taxpayer dollars efficiently.
Employment growth is slowing
On jobs, the report says the region can declare the recovery from the pandemic complete and should look forward to growth after 2023.
Even as the region recovers from the pandemic, the Portland metro area experienced below-average job growth compared to the rest of the United States, with growth of 1.3% in 2023, according to the report.
In the jobs report, researchers found that three of the four metropolitan counties, excluding Multnomah County, exceeded their 2019 job totals.
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According to the report, the metro region saw a 4.1% increase in the leisure and hospitality sector – a slow increase compared to 2022, when the sector recorded a 10.4% increase.
The region's labor market also saw losses, including 11,000 jobs in professional services, manufacturing and information.
Leased office space also fell from 660,000 square feet to an average of 290,000 square feet, officials said.
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Reassessing Peer Cities
The report reevaluated peer regions to measure the Portland metro area's progress — previously including Austin, Nashville, Indianapolis, Salt Lake City and Seattle, all of which have left Portland behind, officials said.
New comparison cities in the 2024 report include Denver, Milwaukee, Minneapolis and Sacramento. These cities were selected based on similar populations, per capita income, cost burden and similar gross domestic product.
These cities also experienced a decline in immigration and similar foot traffic trends to Portland's Central City.
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The report said Portland experienced a strong recovery in 2023, adding: “We have now reached a stabilized ''new normal.'”
Portland's downtown
Portland's Central City experienced a strong recovery in 2023, trailing only Seattle and Minneapolis, the report said.
The report notes that the pandemic has changed the role of downtowns across the United States, becoming more reliant on residents and visitors compared to previous years.
Researchers said this represents the “new normal” and ongoing recovery efforts should go beyond recruiting office workers as the downtown area needs more residents and visitors, including tourists.
Amid concerns about a decline in pedestrian traffic in downtown Portland, the report found a 14% increase in pedestrian traffic in downtown Portland compared to 2022.
The report also found that Portland's housing premium is 8% when considering median household income, largely due to the high cost of housing.
Steer
Portland lawmakers need to find more efficient ways to spend taxpayer dollars, according to the report.
The city saw a 26% tax increase, driven in part by voter-approved measures, officials said.
The report found that Portland spends more money per capita than its peers.
Areas of concern include the lack of affordable housing, quality of life and taxes – particularly for essential services such as security and the 911 system.
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“Whatever economic energy might be gained from the lifting of public health restrictions or other pandemic-era headwinds is complete. Starting January 1, 2024, we must recognize that this is the new regional economic foundation for Portland and our new peer regions,” said Andrew Hoan, President and CEO of the Portland Metro Chamber.
Hoan added: “Our collective focus must urgently be on reversing population decline and driving inclusive economic development.” Our region is starting to move in the right direction, but we must continue to support policies and major investments that allow us to outpace our competitors to effectively outperform across the country.”
“The 2024 State of the Economy report highlights the importance of government, business and community leaders continuing to work together to address the serious challenges facing our community,” said Roger Hinshaw, Bank of America President for Oregon and Southwest Washington. “While much work has been done over the past 18 months to ensure the vitality of our region, this report highlights the need to continue to focus on creating a community that thrives for local families and businesses.”
The report was prepared in collaboration with ECONorthwest and presented by Bank of America.
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