Lack of economic base hurting Mesa, mayor says

Amid a sea of bleak statistics at the unveiling of an economic study Wednesday, Mesa Mayor Scott Smith chose to take a pragmatic approach to the city’s sobering numbers: “We have what we have,” Smith said.

Becky Holmes' presentation on Mesa's economy (Power Point)

Jay Butler's presentation on Mesa's demographics (Power Point)

Editorial: Smith emerging as leader

Mesa lags in economic well-being, study finds

That was about the present.

For the future, Mesa’s new leader waxed optimism. And he took head-on the essence of what many city leaders have been talking about — changing Mesa from a bedroom to a boardroom community. That means attracting high-paying, high-quality jobs to a city saddled with an image of having too many retirees.

“History has shown us that bedroom communities die,” Smith said. “We settled into what was easiest” — bedroom communities, without creating an economic base, he added.

Attracting those jobs would be the only way to keep the future generation from moving away from the 38th-largest city in the nation in search of better career opportunities, the mayor said at the Mesa Chamber of Commerce event.

“What’s wrong with being a bedroom community?” Smith said, referring to the question he said he often encountered in his mayoral campaign.

“On the surface, nothing for this generation, and probably nothing for the next generation,” Smith said.

But it’s not a sustainable economic model, he added.

Smith noted that children are moving out once they acquire a college education because the city doesn’t offer jobs that equate with their level of education.

Mesa has the highest percentage of high school graduates, but scores lower than peer cities for residents with bachelor’s and graduate degrees, according to the study.

“The reality is many of our children are not coming back because they don’t have the opportunity,” Smith said.

Mesa is losing high-paying construction and housing jobs to the housing bust, its highly educated population is moving to better career opportunities outside, and high gas prices are particularly hurting city residents, according to the chamber-commissioned study, prepared by Arizona State University’s Morrison School of Management and Agribusiness.

Mesa residents’ share of the median family income spent on gas is higher than that of Phoenix, Tempe and Chandler residents, for instance.

Those high gas prices are already becoming a factor, Smith said, in the choices young people are making to move to communities that tend to offer both jobs and housing for short commutes.

Researchers found that Mesa ranks eighth of nine major Valley cities in median income and its average pay per employee is lower than the Phoenix metro average.

Still, the new mayor said that the city has a lot to leverage, with its freeways including the soon-to-be-completed 4 1/2-mile section of Loop 202.

That would enhance access to key city areas and help the city make full use of its resources, especially Phoenix-Mesa Gateway Airport, Smith said. He also emphasized the importance of Falcon Field Airport in northeast Mesa in attracting corporate business by developing hangars.

Mesa has been on the fringes of economic development thus far, Smith said, but added that the large tracts of undeveloped real estate, freeway access, more jobs and the educational resources including ASU Polytechnic campus, East Valley Institute of Technology and A.T. Still University all would help the city attract younger residents who would want to live and work here.

“Right now we need to set the foundation,” Smith said.

Earlier, ASU realty studies director Jay Butler and Cox Communications economist Becky Holmes presented a snapshot of economic and demographic numbers for major Valley cities.

Among other study findings, Mesa ranks seventh for resale home prices in the Valley and eighth for new home sale prices.

Butler noted that the retail sector accounts for 40 percent of the jobs in Mesa, jobs that tend to be low-paying. He added that Mesa needs to pay special attention to the small-business sector to enhance that base. Comparing the office sector with its call center workers to blue-collar workers — well-paid but without a chance to grow — Butler said it’s key to bring jobs with career advancement prospects as well as housing closer together.

He pointed to the fact that 2 percent of Mesa households earn more than $200,000, while the figure in Chandler stands at 4 percent. On the other hand, more than 6 percent of Mesa households earn less than $10,000, while only 3 percent in Chandler fall under that category.

“So the nature of jobs and location is key,” Butler said.