For the time being, it appears that the Oklahoma City economy has sidestepped the recession which has taken hold in all but 28 of the 381 metro areas in the United States. This observation is based on the most recent Adversity Index produced by Moody’s Economy.com.

One of the important factors that has helped to underpin Oklahoma City's economy through the second half of 2008 and into 2009 has been its energy industry. Several of the industry’s key players have relatively strong balance sheets, so they’ve been able to avoid massive layoffs.

However, there are signs that Oklahoma City's recession resistance is wearing thin. In March 2009, total employment in Oklahoma declined by 0.4% year over year, its first negative point since December 2003. Key contributors to this weakness include professional and business services (-5.4%); manufacturing (-3.0%); information services (-1.6%); and financial services (-1.5%).

In March, the education and health services sector continued to add jobs (+2.4%) as did the construction sector (+1% year over year), despite the fact that residential building activity in the metropolitan area has dropped by 39%. 

Looking ahead, given that Oklahoma City's 5.6% unemployment rate is at an 18-year high, there is a significant risk that the city’s economy will contract in the second and/or third quarter of 2009. However, moderate upward pressure on petroleum prices and a flattening of natural gas prices should give the economy a boost heading into 2010.

As for the future, two indicators suggest that the regional economy will probably start to recover earlier than most of the major metro areas in the United States: (1) labour demand in Oklahoma City increased by 1,600 jobs in April, the largest increase in the country, according to the latest Conference Board Survey of Online Advertising; and (2) the metro area had the third-highest ratio of help wanted ads per unemployed person in the country in the same period.

Employment Growth: Oklahoma City vs Total United States

*“Year over year” is each month versus the same month of the previous year.

Data source: U.S. Bureau of Labor Statistics (Department of Labor).
Chart: Reed Construction Data – CanaData.