By Marie Price
The Journal Record
OKLAHOMA CITY – Oklahoma ranked fifth in the nation in
high-technology job growth in 2005, with the Tulsa aerospace
cluster providing many of those jobs, according to a new state
profile report issued Thursday by the Federal Deposit Insurance
Corp.
“Oklahoma is doing well, in terms of job growth, per capita
income growth,” said Alan Bush, insurance and research manager
for the Dallas FDIC regional office. “Both of those look
pretty favorable.”
However, the profile includes a caution about the state of
Oklahoma’s consumer finance, including bankruptcies and late
consumer loan and mortgage payments.
Bush said Oklahoma ranks 11th among the states in job growth.
“Income growth tells me that the types of jobs that are adding
are higher-paying wage positions,” Bush said.
Oklahoma’s energy-driven mining sector has played a part in
that, as have high-tech durable goods such as computers, aerospace
parts and automobile components, as well as transportation goods
manufacturing, he said.
Oklahoma’s FDIC profile shows high-tech employment expanding
faster than total non-farm jobs during 2005, with average wages in
this sector 55 percent higher than other private-sector jobs.
“Economic performance of the state is doing well, and the
banks are doing well also,” Bush said.
The state’s telecommunications industry is doing better but is
still struggling, he added.
Four or five years ago, Bush said, the telecommunications industry
in Tulsa had about 16,000 jobs, compared with about 10,000
now.
“I think it would be hard to expect any near-term return to
the job levels they had in the telecom arena,” Bush said.
“Nevertheless, Tulsa emerged from the problems they
encountered some years back fairly nicely.”
He said Tulsa’s recovery can be in large part attributed to
other manufacturing sectors, the federal government and mining,
which includes the energy industry.
Bush said 2005 was generally a good year for the state’s
aerospace industry, although that has leveled off somewhat.
”It is a big part of the boost in exports,” he said.
“A lot of the aerospace components are going outside of the
country.”
Bush said the recent closure of the General Motors plant in
Oklahoma City meant a loss of many direct manufacturing jobs.
“But some of the manufacturing plants have had some success in
shipping some of those high-tech auto manufacturing components as
exports,” he said. “A lot of those exports, we’ve
learned, are going down to the border, to some of the maquiladora
areas. They’re using some of those components for their
manufacturing purposes.”
Bush said that is especially true of transportation
equipment.
Oklahoma’s gross exports grew by one-third, to about $4.3
billion during 2005, fed by increased demand for commercial
aircraft and transportation equipment, the report states.
Bush said that all industry sectors in the Oklahoma City area are
contributing to job growth, except information technology and
manufacturing.
“I don’t think there’s too much of a surprise in
either one of those loss sectors,” he said. “GM certainly
is the question of the day for the metropolitan area of Oklahoma
City.”
Bush said he does not think the full job-loss impact of the GM
closure has been fully realized.
Severance packages may carry some GM workers through the end of the
year, he said, and some have found new jobs in other sectors.
“I think the balance of the year is going to be pretty
important for Oklahoma City, to see how this weighs out, maybe even
into the first quarter of next year, see how some of these job
losses weigh out and see if these people are successful in either
finding new jobs in the area or relocating to other places where
they can find suitable employment,” Bush said.
Bush said Oklahoma City has experienced telecommunications job
losses though it has not recovered since the earlier dip in that
industry, affected in part by company consolidations.
“I think it will be a while before a meaningful pickup in that
area will be attainable,” he said.
Bush said Oklahoma banks are performing well.
When it comes to return on assets compared to the nation, he said,
Oklahoma turned in a 1.54 pre-tax return for the first quarter of
2006, ranking it 19th among the states.
“That shows a pretty good improvement over the previous
quarter,” Bush said.
Oklahoma banks are also doing well in terms of asset quality and
condition, he said.
“They’re able to manage their risks in a pretty
satisfactory manner,” Bush added.
Oklahoma’s agriculture industry has suffered under the
persistent drought, which brings up some overriding concern on a
longer-term basis, he said.
He said the drought has fostered a lower-then-desirable wheat
harvest yield and other declines in agriculture.
“The weather conditions, the heat and the lack of water are
prompting ranchers to start culling off some of their herds and
sell some of their cattle,” Bush said. “It’s tough
out there for the agricultural producer.”
According to the report, the drought is expected to affect 79
percent of the state’s planted crop acres.
Bush said farmers and ranchers also face possible pressures on the
federal subsidies they receive, rising fuel prices and interest
rates.
“At this point, the agricultural bankers are doing pretty
nicely with managing those risks, as far as what we see as
performance,” Bush said. “But it’s not going to get
any easier going forward, that’s for sure.”
The state profile indicates that 802 bank branches holding $28.6
billion in deposits operate within the large drought-affected area,
as well as 175 community banks.
These financial institutions hold agricultural loans totaling $1.9
billion, with total loans exceeding $12.6 billion.
“While current bank conditions are strong, a continued drought
could be problematic for local borrowers and their lenders,”
the report states.
The report cites consumer finance as an area to watch.
Although per capita personal bankruptcy filings fell noticeably
during the first quarter of 2006 – a new, tighter bankruptcy
law took effect last October – Oklahoma’s four-quarter
moving average exceeds the national average. The state’s
consumer loan past-due rate ranks second highest, with mortgage
loan past-due rates ninth highest among the states.
Bush said Oklahoma has experienced bankruptcies and foreclosure
higher than average since 2000.
“I think some of that would be attributable to the depth of
the recession that Oklahoma hit,” he said. “Since then,
things have started to calm down quite a bit.”
Bush said bankruptcies and mortgage foreclosure statistics tend to
be lagging indicators when it comes to economic recovery. He said
it may take some time for the higher-paying high-tech jobs and
other positive indicators to affect these data in Oklahoma.
“There may be some good news around the corner or down the
road,” he said.
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High-tech sector leads Oklahoma’s economic growth
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