Alabama
Business
CULVERHOUSE COLLEGE OF COMMERCE AND BUSINESS ADMINISTRATION
CENTER FOR BUSINESS AND ECONOMIC RESEARCH
Summer 2002 / Volume 71, Number 3
In this issue:
Economic Outlook—Quarterly Update
Summer 2002
3
Selected Economic Indicators
7
Alabama in 2000—How have we changed?
8
Alabama Business Leaders Confidence Index
Third Quarter 2002
12
THE UNIVERSITY OF
ALABAMA
B U S I N E S S
This report is also available in PDF format on the
Internet at
CENTER FOR BUSINESS AND ECONOMIC RESEARCH
Alabama Business
http://cber.cba.ua.edu
The Center for Business and Economic Research has
available at this site downloadable data on various
topics including population, retail trade, and
employment. Research briefs are also available.
Associate Dean for Research
and Technology
Carl Ferguson
Associate Director
Samuel Addy
Assistant Directors
Deborah Hamilton
Annette Jones Watters
Authors
Ahmad Ijaz
Carolyn Trent
Graphic Design
Sherry Lang
Addtional Contributors
Deborah Hamilton
Sunja Park
Mark Your Calendars!
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January 2003
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The University of Alabama’s Center
for Business and Economic Research
will hold its 2003 Economic Outlook
Conference on January 16, 2003 in
Montgomery, Alabama.
For additional information:
Phone: (205) 348-6191
Email: [email protected]
Alabama Business is a quarterly publication of the
Center for Business and Economic Research,
Culverhouse College of Commerce and Business
Administration, The University of Alabama.
Articles reflect the opinions of the authors, but not
necessarily those of the staff of the Center, the faculty of the Culverhouse College of Commerce, or
the administrative officials of The University of
Alabama.
All correspondence should be addressed to:
Editor, Alabama Business, Center for Business and
Economic Research, The University of Alabama,
Box 870221, Tuscaloosa, Alabama 35487-0221.
For information on the Center for Business and
Economic Research, the Culverhouse College of
Commerce and Business Administration or The
University of Alabama:
http://cber.cba.ua.edu
http://www.cba.ua.edu
http://www.ua.edu
CBER
Economic Outlook
Summer 2002
United States
Overview. Economic statistics released in recent
months show the economy gradually recovering
from the mild recession of the second quarter of
2001. However, continuing layoffs and the lack of
business investments may seem to suggest the recovery is derailing. Positive news is that the U.S. economy grew at the fastest rate seen in over two years during the first quarter of 2002. Major contributors to
the increase in real GDP were private inventory
investment, consumer and government spending, residential investment, and exports.
However, the surprisingly high rate of growth in the
first quarter will probably not be seen again this year.
Payroll layoffs in manufacturing and retailing continue, while a substantial decline in stock market
valuations could have a psychological effect on consumers. And business spending is still on hold.
With overcapacity in most industries, businesses do
not have the option to increase prices or hiring.
Manufacturing. Although manufacturing orders,
shipments, and production are all showing improvement, these have yet to translate into increases in hiring and capital spending. Even the industries that
seem to be doing well are still constrained by overcapacity and an inability to increase prices. Many
must cut payrolls in order to be profitable. This year
alone, manufacturing payrolls have been reduced by
200,000, including 23,000 jobs cut in June.
In recent months, manufacturers have seen the value
of the U.S. dollar fall against other major currencies.
This fall should help exporting firms, although it
takes almost six months before any effects of currency devaluation can be observed. Both capital
goods and export-related production are now and
will continue to be weak for the remainder of the
year. However, consumer goods and automobile
production are running at a much higher pace than
last year. Business equipment output continues to
lag, reflecting the reluctance of the corporate sector
to increase capital spending.
Employment. Even though almost 1.8 million
workers lost their jobs during the recent economic
downturn, this was the smallest number of job losses
in any recession. Payroll employment has stabilized
in some sectors of the economy and payrolls are
actually increasing in the services sector. But both
manufacturing and retailing continue to lose jobs.
Manufacturing job losses were primarily in the
durable goods sector, particularly in electronic and
electrical equipment manufacturing; primary metals;
lumber and wood products; and aircraft and parts
manufacturing. Retailing lost 18,000 jobs in June,
2002. The retailing industry has lost 186,000 jobs
since its peak in July 2001. Construction, on the
other hand, has experienced one of the smallest
employment declines of any recession, losing only
243,000 jobs between March 2001 and May 2002,
mainly due to a strong housing market.
3
increased approximately 8 percent. Applications for
mortgages and refinancings are running at record
high levels. After increasing 14.6 percent in first
quarter 2002, residential investment increased
approximately 4.5 percent in the second quarter.
Interest rates are expected to remain low, at least in
the near term, thus fueling both consumer borrowing
and housing sales. Despite these positives, housing
starts are now slowing down. Nevertheless, housing
remains one of the strongest sectors of the economy
and will continue so as long as interest rates remain
low.
Over the last 12-month period from June 2001 to
June 2002, total payrolls have been reduced by
almost 1.9 million. Although the employment situation is not expected to improve in the near future,
we expect payrolls to stabilize in the coming months.
With overtime hours in manufacturing picking up, it
will probably be just a matter of time before manufacturers stop cutting jobs.
Consumer Spending. Consumer spending increased
3.3 percent in the first quarter of 2002, compared to
6.1 percent in the fourth quarter of 2001. Most
spending was on nondurable goods and services.
Durable goods purchases actually declined 9.4 percent, after an amazing increase of 39.4 percent in the
fourth quarter of 2001. Sustained consumer spending was one of the main reasons the most recent
recession was mild. Consumer expenditures tend to
fall during recessions; this time, however, they not
only remained strong but surpassed all expectations.
With payroll employment still declining and consumers watching their savings and retirement
accounts dwindle in the stock market, spending has
slowed. Also worrisome is that during the 2001
downturn, consumer debt did not decline as it usually does during a recession. Consumer installment
debt is now at levels higher than prior to the recent
recession. Despite everything, consumer spending is
expected to rise as employment recovers. Most consumer spending will be for automobiles, furniture,
appliances, and computers and related equipment.
Housing. Housing markets remain generally strong.
During the last six months, U.S. housing prices have
4
Business Investment. Business investment and
spending continue to lag the rest of the economy.
Fixed business investment dropped in the fourth
quarter of 2001, followed by another drop in the first
quarter of 2002. Investment’s share of GDP is currently around 11 percent; its 25-year average is 11.6
percent. The current share is significantly below the
peak of 13.2 percent experienced in the third quarter
of 2000 and the record high level of 13.9 percent in
late 1981. Business investment spending initially led
the economy into a downturn and is still not showing signs of recovery, particularly in communications
equipment and software. Although business spending on capital equipment might be picking up, we
will not see any noticeable recovery until 2003.
Outlook. Overall, the U.S. economy is expected to
grow 3.8 percent for the remainder of the year, for an
average annual rate of 2.5 percent. Industrial production is expected to increase at the modest rate of
0.3 percent. The unemployment rate should average
around 6.0 percent. The risks to the forecasts include a large U.S. current account deficit. With the
U.S. dollar falling against other major currencies,
industrial overcapacity, and weak worldwide demand
in general, it could get harder to finance the national
deficit without an increase in interest rates. Furthermore, if the U.S. dollar gets substantially weaker, that
could prompt foreigners to reduce their exposure in
U.S. markets, thus triggering another downward spiral in domestic financial markets. However, the
biggest risk to the economy is that consumers will
hold on to their cash and credit cards as they see
their retirement savings dwindle. Reduced consumer
spending would adversely affect the mild economic
recovery underway.
Alabama
Employment. From May 2001 to May 2002, the
state’s economy gained jobs in some sectors and lost
jobs in others, with a net loss overall of 17,000.
Although most of the job losses were in manufacturing, wholesale and retail trade also saw significant
declines. Manufacturing firms lost 11,500 jobs; the
trade sector as a whole lost 5,900; and retailing lost
4,400. Existing overcapacity continues to be a factor
behind this downsizing. Two sectors that had major
jobs gains during the period were services-related
businesses (+2,300 jobs) and the government sector
(+4,300). Almost 2,700 of the 4,300 jobs added by
governments were in public school systems.
Goods producing businesses in the state, which
include manufacturing, mining, and construction,
account for almost 23 percent of nonagricultural
employment. Manufacturing, in particular, generally
weakens before the rest of the economy and continues to stay weak until a recovery is well underway.
Except for the transportation equipment industry,
which includes automobile and defense-related production, every subgroup within manufacturing lost
jobs last year.
Within nondurable goods production, most job losses were in apparel and other textile firms (3,500 jobs
lost) and rubber and plastics producing firms (-1,300
jobs). Within durable goods producing firms, job
losses were concentrated in primary metals (-1,400
jobs), fabricated metal products (-700), electronic and
other electrical equipment producers (-1,100),
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and industrial machinery and equipment producers
(-2,500). Employment in manufacturing is expected
to increase very little in the coming year, adding only
about 1,800 jobs overall. Most of these will be in
auto and related industries.
Although consumer spending has remained stable,
the state has lost almost 3,200 jobs in services producing businesses. These businesses include transportation and public utilities; finance, insurance, and
real estate; services; government; and wholesale and
retail trade. In retailing alone, the state lost almost
4,400 jobs between May 2001 and May 2002.
Transportation and public utilities lost 3,500 jobs.
The only sectors that had significant job growth were
state and local government and services. Most new
state jobs were in education. Finance, insurance, and
real estate added approximately 100 new jobs, mostly
in insurance and real estate.
In 2002 retailing and services businesses are expected
to grow faster than goods producing businesses.
However, overbuilding of retailing centers continues
to affect retailers’ profitability. All major metropolitan areas of the state are losing jobs in this sector.
The Birmingham metropolitan area, the state’s largest
retailing center, has recently lost almost 300 trade
jobs, while the Huntsville metro area lost almost
1,000. Retail and wholesale employment remain flat
in Mobile, while Montgomery lost 200 trade-related
jobs and Tuscaloosa lost 800.
Tax Revenues. During the first nine months of the
current fiscal year, total tax revenues increased slightly over last year’s levels. Sales tax revenues depend
on both consumer and business spending. As the
state’s economy shows signs of a gradual recovery, so
do sales tax revenues. During the first three quarters
of the current fiscal year, sales tax revenues have
increased almost two percent, or approximately $23
million.
Income tax collections tell a different story. Individual income tax revenues declined 0.9 percent,
or approximately $16 million, mainly due to payroll
layoffs and very little new hiring. Corporate tax revenues, on the other hand, increased 33.6 percent, or
$48 million.
Appropriations made to the Alabama Education
Trust Fund during the first three quarters of the current fiscal year increased almost $37 million over the
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previous year’s comparable time period. However,
appropriations made to the state’s General Fund
declined slightly, by approximately $2.2 million. For
the fiscal year as a whole, total tax revenues are expected to increase less than one percent. Sales tax
receipts and income tax revenue will increase, but all
remaining taxes are expected to decline.
Outlook. The state’s economy is expected to grow
2.1 percent in 2002; however, employment will lag.
The manufacturing sector will remain weak at least
through the rest of this year. Most growth will be in
services in major metropolitan areas. The state will
continue to show divergence between the urban and
rural economies of the state, with rural areas contributing very little toward the state’s economic
growth, particularly in services-related industries.
Ahmad Ijaz
Alabama Nonagricultural Employment
Change in Number of Jobs
May 2000
to May 2001
Total Nonagricultural
Mining
Construction
Manufacturing
Durable Goods
Lumber Products
Primary Metals
Fabricated Metals
Industrial Machinery
Electrical Machinery
Transportation Equipment
Stone, Clay & Glass
Nondurable Goods
Food Products
Textile Mill Products
Apparel
Paper & Allied Products
Printing & Publishing
Chemicals
Rubber and Plastics
TCPU
Wholesale & Retail Trade
FIRE
Services
Hospitals
Total Government
Federal Government
State Government
State Education
Local Government
Local Education
May 2001
to May 2002
-15,500
-100
2,600
-13,800
-10,800
-1,900
-3,200
-900
-2,300
200
-1,800
-100
-3,000
800
-1,600
-1,700
-500
300
-500
200
-200
-1,500
-400
5,000
300
-7,100
-9,800
2,300
2,200
400
-1,400
Source: Alabama Department of Industrial Relations.
-17,000
0
-2,300
-11,500
-3,400
200
-1,400
-700
-2,500
-1,100
300
-200
-8,100
0
-1,000
-3,500
-800
-900
-600
-1,300
-3,500
-5,900
100
2,300
0
3,800
-500
3,600
2,700
700
200
Selected Economic Indicators
United States
Gross Domestic Product (billions)
Percent Change
30-Year Treasury Bond Rate
3-Month Treasury Bill Rate
Consumer Price Index
Inflation Rate
Housing Starts (millions)
Percent Change
Total Employment (millions)
Percent Change
Unemployment Rate
Alabama
Total Nonagricultural
Employment (thousands)
Percent Change
Total Manufacturing
Employment (thousands)
Percent Change
Durable Goods Manufacturing
Employment (thousands)
Percent Change
Nondurable Goods Manufacturing
Employment (thousands)
Percent Change
Total Wholesale and Retail Trade
Employment (thousands)
Percent Change
Total Services Employment (thousands)
Percent Change
Alabama Unemployment Rate
Initial Benefit Claims (thousands)
Manufacturing Weekly Hours
Total Tax Revenues (millions)
Percent Change
Total Income Tax Revenues (millions)
Percent Change
Total Sales Tax Revenues (millions)
Percent Change
2000/Q4
2001/Q1
2001/Q2
2001/Q3
2001/Q4
2002/Q1
9,303.9
2.8
5.7
6.0
174.2
3.4
1.5
-6.7
135.6
1.0
4.0
9,334.5
2.5
5.5
4.8
175.9
3.4
1.6
-2.9
135.8
0.6
4.2
9,341.7
1.2
5.7
3.7
177.3
3.4
1.6
2.4
135.2
-0.0
4.5
9,310.4
0.5
5.5
3.2
177.6
2.7
1.6
6.6
134.8
-0.1
4.8
9,348.6
0.5
5.3
1.9
177.5
1.9
1.6
1.9
134.3
-1.0
5.4
9,488.6
1.7
5.5
1.7
178.1
1.2
1.7
7.1
133.9
-1.4
5.8
2000/Q4
2001/Q1
2001/Q2
2001/Q3
2001/Q4
2002/Q1
1,940.6
0.2
1,906.9
-0.4
1,920.1
-1.0
1,909.3
-1.1
1,917.9
-1.2
1,891.7
-0.8
354.9
-2.6
346.7
-4.2
341.0
-6.3
337.1
-6.4
334.8
-5.7
330.9
-4.5
190.7
-2.9
186.1
-4.8
183.4
-6.6
180.8
-6.5
180.2
-5.5
179.9
-3.3
164.2
-2.3
160.6
-3.4
157.6
-6.0
156.4
-6.3
154.5
-5.9
151.0
-6.0
449.4
-0.6
477.9
3.3
4.7
28.0
41.8
1,351.6
-0.2
541.9
-2.6
381.4
-0.7
435.3
-0.9
473.0
2.2
4.9
37.0
41.1
1,471.2
-6.8
621.2
-1.1
370.2
-3.5
442.0
-0.8
481.8
2.1
5.1
28.0
40.6
1,730.5
2.8
832.2
-3.9
381.2
-0.8
440.2
-1.0
484.9
1.4
5.4
29.1
41.1
1,452.0
0.8
622.7
0.9
380.3
0.6
441.8
-1.7
483.0
1.1
5.9
31.5
40.9
1,311.6
-3.0
510.5
-5.8
389.7
2.2
430.5
-1.1
477.2
0.9
5.5
33.9
40.8
1,470.1
-0.1
659.6
6.2
371.4
0.3
Note: All percent changes indicate change over same period of the previous year.
Source: U.S. Bureau of Labor Statistics, U.S. Department of Commerce, Alabama Department of Industrial Relations,
Alabama Department of Revenue, and Center for Business and Economic Research, The University of
Alabama.
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Alabama in 2000—
How have we
changed?
Results from the long-form census questionnaire
(which sampled one in six households) provide a
detailed look at social, economic, and housing characteristics of Alabama residents. These data, coupled
with information on general demographic characteristics released last year, are available in four-page .pdf
profiles for geographies down to the place level. The
complete Summary File 3 data set, which also provides information at the census tract and block group
levels of geography, will be released this fall. Access
the profiles and other available 2000 Census data at
our website, cber.cba.ua.edu.
Here we provide a brief overview of Alabama’s 2000
census results and take a quick look at how we’ve
changed since 1990.
Social Characteristics
Educational Attainment
Alabamians are more educated. In 2000, 75.3 percent of our residents 25 and over had completed
high school. This compares to 66.9 percent of
Alabamians with at least a high school degree in
1990. And 19.0 percent of the state’s 25 and over
population held a bachelor’s degree or higher in
2000—that’s 549,608 college graduates, 150,380 more
than in the last census. Of these college graduates,
36 percent held a graduate or professional degree in
2000. Just 8.3 percent of Alabamians 25 and over
had less than a 9th grade education in 2000, down
significantly from 13.7 percent in 1990.
Marital Status
Many of us are married—1,952,261 to be exact, or
55.6 percent of our population 15 and over.
However, this is one percent below the married share
in 1990. A larger number of Alabamians were separated or divorced in 2000—447,206, or 12.7 percent,
compared to 10.7 percent of residents 15 and over in
1990. With improved life expectancy, we see fewer
widows and widowers, at 7.8 percent of residents 15
and over in 2000 versus 8.7 percent in 1990.
Grandparents as Caregivers
Alabama had over 56,000 grandparents living with
one or more of their grandchildren under 18 and
responsible for most of their basic needs. This was a
new question in 2000.
Veteran Status
There were 447,397 civilian veterans residing in
Alabama in 2000, up slightly (2.9 percent) from
434,787 in 1990.
Disability Status of the Civilian Noninstitutionalized
Population
Changes in concepts and age groups make comparing responses in 1990 and 2000 impossible. In 2000
almost half of Alabamians 65 and over said they had
some type of disability. Disability is defined to
include blindness, deafness, and severe vision or
hearing impairment; difficulty performing basic
physical activities, such as walking; difficulty
learning, remembering, or concentrating; difficulty dressing, bathing, or getting around inside the
home; and, for the population 16 and over, difficulty going outside the home alone to shop or
visit a doctor’s office. Of Alabama’s population
aged 21 to 64, 23.2 percent had some type of disability.
Residence in 1995
We Alabamians are not very likely to leave the
state. Just 9.1 percent of the population 5 and
over moved out of state between 1995 and 2000.
Over the five year period from 1995 to 2000,
over half of Alabama residents did not move
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(57.4 percent). This share is about the same as ten
years ago. Of those who moved, most moved to a
different house in the same Alabama county (24.7
percent, down from 25.6 percent in 1990). More
Alabamians changed counties within the state
between 1995 and 2000 than between 1985 and
1990—almost 366,000, compared to just over 284,600
in 1990. However, fewer residents moved to another
state during the five years leading up to the 2000
census than in 1990.
Nativity and Place of Birth
Most of the 4,447,100 people living in Alabama in
2000 were born here. Just 87,772 were foreign born—
amounting to 2.0 percent of the total population and
up from 1.1 percent in 1990. Almost three-fourths
of Alabamians were born in the state, although the
percentage dropped slightly from 75.9 in 1990 to
73.4 percent in 2000. The share of residents born in
another state increased from 22.4 percent in 1990 to
24.0 percent in 2000.
Region of Birth of Foreign Born
The state’s small foreign-born population was from
three primary regions—Latin America (40.5 percent),
Asia (29.9 percent), and Europe (21 percent). The
number of foreign-born from Latin America
increased by over 30,000 between 1990 and 2000. In
1990 Alabama residents born in Latin America
accounted for only 13.1 percent of the foreign-born
population.
Language Spoken at Home
The share of Alabama residents speaking a language
other than English at home rose from 2.9 percent in
1990 to 3.9 percent in 2000. Over 60 percent of
those speaking another language at home also speak
English very well.
Economic Characteristics
Employment Status
In 2000, 59.7 percent of Alabama’s population 16
and over was in the labor force. This percentage was
down from 61.1 percent in 1990—which could be
due to more young people finishing high school or
pursuing higher education before entering the labor
force. Among females 16 and over, labor force participation was lower than that of the total population
at 52.8 percent in 2000. For families with children
under age 6 in 2000, 58.4 percent reported both par-
ents in the labor force, just below the percentage of
58.7 in 1990.
Commuting to Work
We’re spending more time in the daily commute.
Mean travel time to work increased from 21.2 minutes in 1990 to 24.8 minutes in 2000. And we generally drive it alone. In 2000, 83 percent of Alabama’s
workers drove solo to work. This share was up from
79.2 percent in 1990, as residents decreased the use
of carpools from a 15.4 percent share in 1990 to just
12.3 percent in 2000. The number who used public
transportation (including taxis) to get to work fell
from 13,279 in 1990 to 9,496 in 2000. About 39,300
Alabamians (2.1 percent of all workers) worked at
home in 2000, up from about 31,100 in 1990.
Occupation
Most Alabamians worked in white-collar occupations
in 2000, with 29.5 percent in management, professional, and related areas and 25.9 percent in sales and
office jobs. Another 13.5 percent were employed in
service occupations. Nineteen percent of Alabama
workers held jobs in production, transportation, and
material moving occupations, while about 11 percent
worked in construction and maintenance jobs. Data
on occupational categories are not comparable to
1990 due to changes in the classification system.
Industry
Data on employment by industry are also not fully
comparable between 1990 and 2000 due to changes
in classification. Services dominated industry
employment in 2000, with 37.8 percent of workers—a
9
big increase over the approximately 29.4 percent
share in 1990. Manufacturing lost employment
share, with the percentage of workers dropping from
22.9 percent in 1990 to 18.4 percent in 2000.
Employment in the construction and FIRE sectors
also increased strongly during the ten years. While
the number and share of workers in retail trade
seemed to fall between censuses, this decrease is
largely due to classification changes. Some retail
occupations in 1990 were reclassified into other categories in 2000.
Class of Worker
The share of Alabama workers in the private sector
rose from 75.6 percent in 1990 to 77.9 percent in
2000. The percentage of government workers fell
correspondingly, from 17.4 percent in 1990 to 15.5
percent in 2000, while the percentage self-employed
in their own business stayed fairly steady at 6.6 percent. There were 298,434 Alabamians employed by
local, state, and federal governments in 2000.
Income in 1999
Median income of Alabama’s approximately 1.74
million households amounted to $34,135 in 1999.
In constant 1999 dollars, this household income was
up 11.5 percent during the ten years since 1989. The
households that are families fared better than all
households, with median income of $41,657 in 1999,
up 11.9 percent, after adjusting for inflation, from
1989. Per capita income in Alabama (as calculated
by the Census Bureau) rose from $11,486 in 1989
($14,907 in 1999 dollars) to $18,189 in 1999, for a
real increase of 22 percent.
Poverty in 1999
The overall well-being of Alabama’s residents as
measured by the percentage below the poverty level
improved moderately between 1989 and 1999. In
1999, 12.5 percent of the state’s families had incomes
below the poverty threshold, compared to 14.3 percent in 1989. Although the poverty status of families
headed by a female also improved, the poverty level
for female-headed families remained much higher
than for all families. In 1999, 44.6 percent of singlemom families with children younger than 18 lived
below poverty, down from 50.1 percent in 1989.
Children under 5 in families with only a mother
present remained likely to be living in poverty, with
56.6 percent of these families in poverty in 1999.
Poverty percentages were particularly improved for
individuals 65 and over—the share of elderly living in
poverty fell from 24.0 percent in 1989 to 15.5 percent in 1999.
Poverty Rates for Alabama
(Percent)
Families
Families with related children
under 5 years
Single mothers with related
children under 5 years
Individuals
Related children under 18 years
Individuals age 65 and older
1989
1999
14.3
12.5
23.7
21.9
65.6
18.3
24.0
24.0
56.6
16.1
21.1
15.5
Source: U.S. Census Bureau.
Housing Characteristics
Type of Structure
Almost two-thirds of housing in Alabama was
detached, single-family homes in 2000, with the
number up over 166,300, although the share was
down 1.7 percent from 1990. The difference was due
in part to a sharp increase in the number of mobile
homes. There were 319,212 mobile homes in 2000,
or 16.3 percent of all dwellings—over 101,400 more
than in 1990. The number of structures with 20 or
more units climbed almost 22,700, or 46.5 percent,
during the decade.
Year Structure Built
About 443,000 of the 1,963,711 housing units count-
10
ed in the state in 2000, or 26.5 percent, were built
since January 1, 1990. This was up from 391,775
units built in the previous decade. Almost 481,000
housing units were at least 40 years old in 2000. The
share of units that were 40 years old or more rose
from 17.9 percent in 1990 to 24.5 percent in 2000.
Number of Rooms
Houses were slightly larger on average in 2000. The
median number of rooms was 5.5 in 2000 compared
to 5.3 in 1990. The percentage of units with seven
or more rooms rose from 23.4 percent in 1990 to
27.3 percent in 2000.
Vehicles Available
Fewer Alabama residents were without a vehicle in
2000. There were about 143,600 occupied housing
units with no vehicle available in 2000. This 8.3 percent of the total compares to 10.3 percent in 1990.
In 2000 most residences had one or two vehicles,
while about 21 percent had three or more—the same
as ten years ago.
Home Heating Fuel
The decade of the 1990s brought a sizeable jump in
Alabamians heating with electricity. Electricity was
the primary source of heat for 46 percent of units in
2000, up from 34.6 percent in 1990. This represented an increase of 277,220 units. Electricity passed
utility gas, which held the dominant share in 1990.
The number of units heated by utility gas rose
almost 16,000, while the sector’s share fell from 42.8
percent in 1990 to 38.1 percent in 2000. While
homes heated by bottled, tank, or LP gas also
increased slightly, the share in this category fell from
15.6 percent in 1990 to 14.0 percent in 2000.
Selected Characteristics
Only about 11,000 occupied housing units were
without complete plumbing in 2000, down from
almost 21,000 in 1990. The share without complete
kitchen facilities dropped by a third during the
decade to less than 10,000. No telephone service
was available in 4.2 percent of units in 2000, a sharp
drop from 8.7 percent without a telephone in 1990.
Housing Value
The median value of owner-occupied, one-family
housing units, measured in constant 2000 dollars,
rose from $67,842 in 1990 to $85,100 in 2000. This
represents a strong real increase of $17,258, or 25.4
percent, in housing value during the decade. In
2000, 61.9 percent of owner-occupied single-family
units were valued at less than $100,000, 28.8 percent
were valued at $100,000 up to $200,000, 5.7 percent
at $200,000 to $300,000, and 3.5 percent at $300,000
or above.
Mortgage Status and Selected Monthly Owner Costs
More Alabamians held mortgages on their residences
in 2000. The 64 percent of mortgaged properties
compares to 59.9 percent in 1990. The median
monthly owner cost (including mortgage, taxes,
insurance, and utilities) for homes with a mortgage
was $816 in 2000, up 15.7 percent in constant 2000
dollars from $705 in 1990. For the 36 percent of
homes that were not mortgaged, the median monthly owner cost was just $228. The majority of
Alabama homeowners (60.5 percent) spent less than
20 percent of 1999 household income on mortgage,
tax, insurance, and utilities payments. This was
slightly below the 63.1 percent spending less than 20
percent in 1989. However, the 13.9 percent spending
35 percent or more of income on housing in 1999
compares to 11.9 percent in 1989.
Gross Rent
Renters in Alabama paid a median gross rent of $447
in 2000, up an inflation-adjusted $32 from 1990, or
7.7 percent. Gross rent includes contract rent, and
an estimated average monthly cost for utilities and
fuel. Renters tended to be more burdened with
housing costs than homeowners—27.4 percent of
renters spent 35 percent or more of their 1999
income on housing compared to 13.9 percent of
homeowners.
Carolyn Trent
11
Alabama Business
Leaders Confidence
Index—Third Quarter
Conflicting signals being sent by the financial markets and economic reports are reflected in the consensus expectations of Alabama business leaders for
third quarter 2002. A reading of 60 on the Business
Leaders Confidence Index (BLCI) indicates moderate
economic improvement, but is below the 63 registered in the second quarter. On the year-ago comparisons, the third quarter BLCI of 59 represents the
strongest year over economic improvement yet—not
surprising since third quarter 2001 included the
immediate impact of the terrorist attacks.
About 64 percent of panelists expect the U.S. economy to improve in the third quarter of 2002 compared to the second quarter. While almost 60 percent anticipate continued generally moderate
improvement in Alabama’s economy during the
quarter, respondents are less worried about a downturn—10.1 percent forecast a decline in economic
activity in the state, while 14.1 percent think the
national economy could turn down during the
quarter.
Strength in the Alabama economy should come
from sales, with 65 percent of Alabama business leaders forecasting increased sales in their industry in the
third quarter. Profit expectations slipped slightly—
half of panelists anticipate increased profits in the
third quarter compared to 56 percent last quarter.
The University of Alabama
Center for Business and Economic Research
Box 870221
Tuscaloosa, Alabama 35487-0221
Address service requested.
Job gains during the quarter will be slight, with about
30 percent of respondents expecting hiring to pick
up. Capital spending trends remained positive.
Almost 42 percent forecast increased capital expenditures in their industry in the third quarter compared
to 13 percent expecting a decline.
The Business Leaders Confidence Index combines
expectations for the national and state economies as
well as industry sales, profits, hiring plans, and capital expenditures from Alabama panelists who complete an online survey. Respondents to the third
quarter survey represented all major industry groups
in a broad spectrum of businesses statewide. The
BLCI is developed in partnership between Compass
Bank and the Center for Business and Economic
Research. Complete results can be found at
blcindex.cba.ua.edu.
Carolyn Trent
Nonprofit Organization
U.S. Postage Paid
Tuscaloosa, AL 35401
Permit No. 16