Has Phoenix Stopped Growing?

A funny thing happened to Phoenix this recession. It seems people quit moving to the town.

From the Arizona Republic:

A once-unthinkable thing happened to Salt River Project this June.

When the utility counted, officials found 30 fewer residential customers in the 2,900-square-mile territory covering a major portion of what recently was the fastest-growing region in the country.

SRP’s territory spans the Valley in an irregular shape across 15 communities from Glendale, through Phoenix and east to Queen Creek, with Arizona Public Service Co. serving several pockets. Mesa has its own small utility district downtown.

SRP officials said that the June-to-June decline in residential accounts is the first time the company has recorded such a loss, although solid records only go back to the 1980s. The customer loss is shocking considering the rapid growth to which the region has grown accustomed.

In 2007, Maricopa County grew faster than any other county in the nation, adding about 102,000 people.

A recent Census Bureau report showed that growth continued in 2008, although at a slower pace.

State Demographer Bill Schooling said that despite the SRP territory decline, the state and Maricopa County both still are growing.

“I find it interesting, but there are a number of other indicators out there that haven’t shown a decline,” Schooling said.

Tax data, the number of births vs. deaths, and new driver’s licenses all indicate the state’s population continued to grow in the past year, he said.

“We are certainly not seeing the extremely high growth we were encountering,” Schooling said.

The last time the state population declined from one year to the next was from 1944 to 1945, when the population fell to 594,000 from 610,000, according to U.S. Census Bureau estimates.

For a metropolitan area and a state for that matter that relied on migration to fuel its largest industry — construction — this is to say the least a bit troubling. While there may be some other metrics that indicate things aren’t quite as bad as the SRP numbers indicate, it’s probably fair to say that this is a problem that no amount of whistling past the graveyard is going to cure.

Is it a permanent condition or will people still flock to the state for the weather and lifestyle once the national economy turns around? That seems to me a difficult question to answer. Kind of like a chicken and egg situation. Surely, those that don’t need to work, in other words retirees, will continue to come provided they can sell their existing homes. Those, however, that need employment are likely to avoid the state until they can be assured of a job and that won’t happen until the demand for housing picks up enough to provide jobs. You see the problem.

Arizona has been growing for sixty years and Phoenix has been the epicenter of that growth. History would suggest that it should return but then again, history hasn’t had a period of economic upheaval to match this one during those sixty years. There’s an outside chance that Phoenix might have to find a new growth industry.

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