Whether You're Selling or Buying a Franchise You Need to Consider an Important Fact
Whether You're Selling or Buying a Franchise You Need to Consider an Important Fact
In areas with higher than normal unemployment rates there is an impact on spending. This change on how and where people spend their money affects everything from durable goods to restaurants. In the case of necessary purchases the impact may be diminished. However, when people have less money to spend, it will have a negative effect on businesses and services. Since most economic experts predict that the U.S. economy won't see a sustained recovery until the end of 2011, franchisors and prospective franchisors should be aware of unemployment data for particular States and markets.
Following is a snapshot of unemployment data sorted by State and Metropolitan Statistical Areas from the Bureau of Labor Statistics.
High Unemployment States:
StateandUnmployment Rate September, 2010
Nevada
14.4%
Michigan
13.0%
California
12.4%
Florida
11.9%
Rhode Island
11.5%
South Carolina
11.0%
Oregon
10.6%
Kentucky
10.1%
Indiana
10.1%
Georgia
10.0%
Arizona
9.7%
States with Lower Unemployment:
Nebraska
4.6%
New Hampshire
5.5%
Kansas
6.6%
Virginia
6.8%
Minnesota
7.0%
Maryland
7.5%
Utah
7.5%
Wisconsin
7.8%
Texas
8.1%
New York
8.3%
Lets zero in on a smaller area:
A Metropolitan Statistical Area is a geographic entity defined by the U.S. Office of Management and Budget (OMB) for use by Federal statistical agencies in collecting, tabulating, and publishing Federal statistics. A metro area contains a core urban area of 50,000 or more population, and a micro area contains an urban core of at least 10,000 (but less than 50,000) population. Each metro consists of one or more counties and includes the counties containing the core urban area, as well as any adjacent counties that have a high degree of social and economic integration (as measured by commuting to work) with the urban core. There are 372 MSAs.
The following table shows the unemployment rates for some large and more recognizable MSA's:
MSAU/E Rate
Washington-Alexandria-DC-VA-MD-WV
5.9%
Albany-Schenectady- Troy NY
6.6%
Minneapolis-St. Paul-Bloomington, MN-WI
6.7%
Austin-Round Rock-San Marcos, Texas
6.8%
Boston-Cambridge-Quincy, Mass
7.3%
Dallas-Ft.Worth-Arlington, Texas
7.9%
Columbus, Ohio
8.2%
New York-Northern NJ- Long Island, NY-NJ-PA
8.5%
Phoenix-Mesa-Glendale, AZ
8.9%
LA-Long Beach-Santa Ana, CA
11.8%
You can use this data to help make decisions regarding franchise sales, future growth or if you're considering to franchise in a specific area.
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