Consumer spending still weak in Arizona

PHOENIX - Arizona had the second-weakest growth in consumer spending in the nation since the recession ended, according to a new government report released Thursday.

Spending per person increased 6.2 percent in Arizona from 2009 through 2012, the latest year for which figures are available. The only state with lower growth was Nevada, where spending eked out a 3.5 percent increase.

By contrast, spending jumped 28 percent in North Dakota, largely due to revenue from new oil drilling techniques.

The figures emerged Thursday from a new annual report from the government that for the first time reveals consumer spending on a state-by-state basis. The numbers point to substantial shifts in the economy since the recession ended.

In the three years leading up to the downturn, spending in Arizona jumped 21.2 percent, the fourth-highest in the nation. Big home price gains during the housing bubble likely fueled the increase.

However, home values plummeted in Nevada, Arizona and Florida when the bubble burst. The persistently weak consumer spending in those states underscores the lingering damage the housing bust inflicted on their economies.

Nevada and Arizona had some of the largest drops in consumer spending in 2009. Nevada's consumer spending dropped 4.6 percent, the biggest of all the states. It was followed by California, where spending dropped 4.1 percent, and Arizona, with a drop of 3.9 percent.

The government's report covers spending in each state from 1997 through 2012. The figures show that spending patterns were very different before the recession.

Nevada and Arizona also received the smallest income gains in the first three years after the recession ended. Salaries and other income in Nevada rose just 3.8 percent and in Arizona, 6.7 percent. The national average was 11.1 percent.

And Nevada's unemployment rate was 7.7 percent in June, the third-highest. Arizona's was 6.9 percent, 10th-highest.

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