Job growth in the Portland Metro Area is expected to reach 10 consecutive years soon, which will be the longest job expansion for the city on record, according to a 2019 Portland State University economic forecast released Thursday.
PSU’s Northwest Economic Research Center’s (NERC) report shows unemployment in the metro area was 3.9 percent in March, an indication that the local economy is at full employment.
The industries that saw the largest job growth were construction, transportation, warehousing, utilities and wholesale. Some of this job growth, according to the 39-page report, is related to the opening of new Amazon distribution centers.
“When you reach this stage of the business cycle with full employment, job growth slows down,” said Tom Potiowsky, a NERC senior advisor who co-authored the report. ”That doesn’t mean we are heading toward a recession.”
The report also concludes that although job creation continues to boom, not all segments of the economy and population are thriving in Portland.
“While we may soon celebrate the longest job expansion here in the Portland MSA, not all is rosy in the Rose City and surrounding counties,” Potiowsky wrote. “Issues that put pressure on economic growth include public sector budgets, housing affordability and homelessness, the opioid crisis and climate change.”
Although affordable housing is a factor impacting the region’s growing homeless population, the Oregon Legislature’s passage of S.B. 608 will not help keep rental prices affordable or increase the state’s affordable housing stock.
That’s because Oregon’s rental prices have been rising well below what the bill caps annual rent increases by: 7 percent plus inflation. Portland metro’s 2.1 percent annual rent growth rate is slightly higher above the state’s average.
“Since its peak in 2016, median rent growth across the state has averaged 1.9 percent; it is unlikely this 7% threshold will be crossed anytime soon,” the report states.
Rent control may not be the solution to the metro area's affordable housing crises.
“The solution is not to have rent control. You need to increase the housing supply in constructive ways such as taller residential buildings, changing zoning laws to allow for more multi-family housing and building more accessory dwelling units, ” Potiowsky said. “The state rental control law is probably most effective in reducing unfair evictions, not increasing affordable housing.”