For a while it looked like Raleigh's economy would not feel the full impact of the recessionary conditions that have taken hold across the United States. However, it has become clear that this is definitely no longer the case. In fact, Raleigh's rate of employment growth dropped from +0.3% in September 2008 to -3.2% in February 2009.

Raleigh's construction sector has been the largest contributor to the lower total employment numbers. A sharp drop in both single and multiple housing starts has shrunk construction employment by 20%, which is equivalent to 7,900 jobs lost over the past year.

Employment has also fallen sharply in manufacturing (-9%), education and health services (-4.2%) and professional services (-3.2%). Moreover, based on the most recent Manpower Employment Outlook Survey that reported that Raleigh employers expect to hire at a slow pace during the second quarter, the short-term prospects for the metropolitan area's economy appear to be weak.

However, Raleigh does have some strong positive fundamentals. In fact, for the past three years, the city has been ranked by Forbes Metro Ranking as the number one "best place for business and careers" in the United States.

The strong fundamentals include relatively low business and living costs, a well-educated workforce, a comparatively low number of sub prime mortgages and sustained relatively strong net in-migration.

Raleigh's economy is also supported by the Research and Triangle Park, one of the largest science parks in North America. Employers in the park include IBM, GlaxoSmithKline, Cisco, Biogen Idec and the U.S. Environmental Protection Agency.

Together, the city's solid economic foundation and the impact of unprecedented monetary and fiscal stimulus across the entire country should help the Raleigh economy pick up steam in 2010.