Oklahoma is different. Nationally, recession alarm bells ring, home values decline, foreclosures skyrocket and unemployment rates climb. Not in Oklahoma. The state is holding its own, according to experts, analysts, economic surveys, statistics and national rankings: •Oklahoma's unemployment rate in February was 3.1 percent. Nationally, it was 4.8 percent. •Oklahoma home values increased by 4.24 percent in 2007. Nationally, the median home price dropped 1.4 percent that year. •Oklahoma City is 19th out of the 100 largest metropolitan areas on the Forbes 2008 Best Cities for Jobs list. •Oklahoma was fourth in 2007 for business startups, according to the Kauffman Index of Entrepreneurial Activity. The same index has Oklahoma fourth out of 40 real estate markets for corporate expansion or relocation and sixth among the country's best performing markets in terms of retail vacancy, rental rates and development. RealtyTrac reported in February that the number of foreclosure filings in Oklahoma last year — 13,594 — was down 12.78 percent compared with 2006. The national foreclosure rate increased 80 percent from 2006. Nobody says Oklahoma is completely in the clear. But the state is in a better position than most.
A history lessonFor many Oklahomans, business is good to very good, but taking a look at how Oklahoma fared in the past helps predict the future. Jim Shumsky, who owns Junior's, the northwest Oklahoma City restaurant where he was a customer decades ago, looks at both sides of the coin. "Business (today) is better than ever,” he said. During the oil boom, he saw as many oil deals made in the restaurant as at the banks. Shumsky also remembers the crash following those free-spending days of the early 1980s. Oil and gas wildcatters were among the first to lose when Oklahoma's economy crashed in 1983. Shumsky doesn't see the same thing happening this time.
Times have changedRoy Williams, president of the Greater Oklahoma City Chamber, thinks the times are definitely different from the last "boom.” He said energy alone isn't keeping the local market humming. Likewise, Williams thinks Oklahoma may be immune from the housing crisis that is driving down the national economy. "We don't have a highly speculative market here,” Williams said. "A lot of other cities have very aggressive speculative builders. We don't. We tend to have highly conservative builders who tend to build for the market instead of what the market might become.” Oklahoma's economy is also less dependent on manufacturing, which Williams suggests may also add to relative financial stability.
Not all agreeTim O'Connor argues that the decline in manufacturing hasn't been supplanted with equal or better jobs. O'Connor, president of the Oklahoma Labor Federation and one of 1,500 who lost their jobs last year at Dayton Tire Co., reports he is making far less working at an insurance agency than the $22 an hour he earned at the plant. "I was fortunate that I was one of about 400 of us who qualified for the retirement package that was offered,” O'Connor said. "Things would be pretty tight at my house without the retirement and medical benefits I got. "I hear all these rosy pictures, and when I see $20 an hour jobs leaving and call centers taking their place, that's not a good trade-off,” O'Connor said. Williams is confident Oklahoma won't face the same hang-over it did in 1983. Back in 1983, Williams said, oil prices hitting $40 a barrel threatened to put energy companies out of business if they dropped by half. "Today, if prices got cut in half, these companies would still be very profitable. ... We're in a very different situation — we just don't have that scenario of boom and bust anymore.”
Bucking the trendsExecutive headhunter James Farris closely follows economic trends. "What I've found is we tend to lag behind the East and West Coasts,” Farris said. "When you see a dip come there, it's generally a while before it gets here.” Farris recalls during the 2001 national recession, he only noticed problems related to companies with national operations. "Some of the companies that we had as clients — national companies — they were the ones taking a hit in their other operations and it was then that Oklahoma City was affected,” Farris said. "Oklahoma City was having to justify costs and expenses across the national spectrum.” Lynn Gray, chief economist at the Oklahoma Employment Security Commission, tracked recessions back to the late 1970s and discovered a pattern in unemployment data: During the double-dip recessions of 1980 and 1981, Oklahoma's unemployment peaked at 5.6 percent and 9.2 percent, while the national rate hit 7.7 percent and 10.8 percent. A similar divergence was recorded during the 1991 recession when the national rate hit 6.8 percent while Oklahoma's peaked at 5.9 percent. It was only during the most recent recession — 2001 — that the rates came close.