Halfway through: Analysts revisit Tulsa's economic development in the first half of 2009.
07-19-2009, Tulsa World - Laurie Winslow
http://www.tulsaworld.com/busi . . . saW10356&archive=yes
Halfway through 2009, Tulsa's economy is weathering the recession better than many parts of the country. Although our city has taken a hit, it continues to putter along at a slower pace.

What lies ahead economically is anyone's guess. Recently, we asked some industry experts and economists to take a guess at how they think the city and its sundry sectors will perform the rest of the year, while also sharing thoughts on how it's fared so far.

Oklahomans may have been overly optimistic heading into this recession, but they have learned the state is not recession-proof, said Russell Evans, director of the Center for Applied Economic Research at Oklahoma State University.

Tulsa has been more adversely affected by the national recession than Oklahoma City and some areas of the state. Evans suspects that is because Tulsa has strong manufacturing, energy and construction clusters that have been especially affected by the recession.

Although the area is doing much better than the rest of the country, it's doing slightly worse than Keith Hazelton had anticipated up to this point, said the director of economic research for the Oklahoma Bankers Association. Hazelton attributes that to the rapid collapse of energy prices from a year ago, and the depth and breadth of the current recession, which is finally taking its toll on Tulsa and the state.

"It's been somewhat of a delayed reaction, but it has finally encroached our borders, and with a national unemployment heading toward 10 percent its effects could linger a little bit longer than we like," Hazelton said.

The Tulsa area's jobless rate climbed to 6.6 percent in May its highest level since June 2003, when the reading hit 6.8 percent.

"Tulsa has performed better than our peer cities around the U.S. during the current national economic downturn, with the majority of growth originating from existing companies. New business activity now seems to be accelerating as well, along with other signs that the economy is gradually improving," said Jim Fram, senior vice president of economic development with the Tulsa Metro Chamber in an e-mailed comment.

"The Tulsa region is seeing pockets of growth in a few specific areas, including energy, and manufacturing connected to the aerospace industry."

Examples of companies seeing growth include M&M Manufacturing, Meeks Group, Ameristar and Avansic. Also, in the energy sector, Dallas-based Holly Corp. this year bought the Sunoco refinery.

How Tulsa's economy performs in the second half of this year depends on energy prices and when the national economic recovery begins, Evans and Hazelton say. Both economists think the area's jobless rate could tick upward.

Evans expects Oklahoma's recovery will be slow and tempered, with a modest recovery at the end of the year into next year. He noted that active rig counts across the state are down by almost two-thirds over a year ago, and could stay repressed through the end of 2009 and well into 2010.

"I think that things will get a little bit worse before they get better. I think that's true in the Tulsa area, in particular, but across the state," Evans said.