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Worse Before Better: The Central Oregon Economy

What are the lessons of central Oregon’s boom and bust, and what are the right engines for its future success?

It wasn’t long ago that central Oregon was the state’s fastest growing economy. Californians were selling their $600,000 homes, moving to central Oregon (where it’s sunny and warm and you can ski…), and buying much grander homes for half the price. They’d sit on the difference and enjoy a comfortable life in a booming town. The building industry grew at an astonishing rate. And so did the accompanying services.

But a new day has come (some say almost overnight): construction is at stand-still; home prices have taken a dive; and the economy is suffering.

Two thousand new single family homes were built in Bend in 2005. This year, only 234 building permits were requested. Default notices in Deschutes County have almost tripled over the last year, from 590 in 2007 to 1,308 in 2008 — with three months to go.

This pinch on the economy is spreading past the building industry. The City of Bend laid off 13 people this week (for a total of 33 this year). They’re leaving 50 more jobs unfilled, and they say the hard days are still to come, when a loss of property taxes starts to impact the funding for police, fire, road maintenance and more. Last year, Neighbor Impact distributed 5,000 emergency food boxes in central Oregon. This year they’re up to 9,000… each month.

But the news is not all dire. Talk to economic development professionals and they’ll tell you that green energy or information technology or aerospace (or all of the above) could be the future of the central Oregon economy. And that the area continues to attract business.

We recorded this program Monday evening, October 6, in front of a live audience in Bend. But the web conversation has just gotten started. Share your thoughts right here, right now! What’s your perspective on the central Oregon economy? Did it grow too big, too fast? Is it just experiencing a few hiccups on a road of truly sustainable growth? What are the right engines for its future success? And what does the central Oregon example of the last few years mean for the rest of the state?

Photo credit: matthew.hickey / Flickr / Creative Commons

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