How higher housing costs impact Phoenix economic development
Thanks to grants and programs, Phoenix helped many small businesses survive COVID-19, but higher housing costs could hurt future economic development.
Early in the COVID-19 crisis, Phoenix predicted 20 to 25% of the city’s small businesses would not survive, but Christine Mackay, the city’s economic development director, said the percentage turned out to be lower than originally feared.
“I’m so proud to tell you we lost less than 8% of our businesses because of the quick reaction of the city council and city managers in getting them the resources that they needed,” she told a council subcommittee.
Phoenix earmarked $25 million in federal COVID-19 relief and stimulus funds to provide cash and other programs to small and micro businesses and artists
Higher housing costs have impacted the city's sales pitch to companies looking to move or grow in Phoenix.
“I’ve always been able to market Phoenix across the globe with this very factual statement: that 90% of your workforce can live within a 30-minute [commute] of where they work. I can’t say that any longer,” Mackay said.
Being able to tout a half-hour commute is critical to successful economic development, Mackay said.
During the 2021-2022 fiscal year, the economic development department said it helped more than 30 companies move to the city, creating more than 10,000 jobs. Mackay said more businesses are focusing on finding a talented, inclusive workforce.
“When I look at site selection missions, my whole career it had been led by a site selector or a real estate decision maker. Now, greater than 50% of the time it’s led by the director of human resources. They are looking for a place where they feel like they will find their workforce, where their workforce will feel included and where their workforce will love to be,” she said.