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Arizona’s economy on slow road to recovery, says forecaster

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Arizona’s economy on slow road to recovery, says forecaster

Arizona's economy is pulling out of recession, albeit it at a slow pace, as the job market, retail sector and housing industry show signs of improvement, a top economic forecaster said Wednesday.

The state's housing market will likely not recover to pre-recession levels until 2014, while the job market restructures and the retail sector recovers gradually, Elliott Pollack of Elliott D. Pollack & Co. said at the Economic Outlook 2011 Breakfast organized by the Greater Phoenix Chamber of Commerce.

"Recovery in Arizona has begun, but Arizona has some unique problems," Pollack said. "Things are improving, but slowly."

Relying heavily on population growth to fuel its economy and on the retail sales tax to support its budget, Arizona suffered more than other states when people began cutting back on spending and the housing market tanked, Pollack said.

"The positives are that housing is more affordable as housing prices have flattened out," Pollack said. "In the long run, we're in good shape."

He cautioned that the state still has about 80,000 units on the market and that about 52 percent of homeowners here have mortgages that are greater than the value of their homes.

Also at the breakfast, two business executives mulled ways that business and government can repair the Arizona brand. Michael Bidwell, president of the Arizona Cardinals, and John Martinson, founder of China Mist Brands, said the Arizona brand has been tainted in part by national coverage of SB 1070.

"I don't think the business community saw it coming," Martinson said. "People were oddly unaware that it was going to cause more problems for the state's brand."

To counter perceptions that Arizona has "fallen to the bottom," the state needs a marketing budget to promote its positives, such as the thriving solar and renewable power industry, the tourism hot spots and innovations from state universities, Bidwell said.

"Our brand has been beat up, and what we have to do is understand that we are competing," Bidwell said. "We all own brand Arizona and it's time we start fixing it."

Roughly 850 people attended the economic outlook breakfast this year, more than in most of the previous six years the chamber has held the event, said chamber spokeswoman Jody Ryan.

"There's definitely been an interest in when the economy is going to turn around," Ryan said. "People are really hungry for information."

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