Five years after crash, economy hasn't recovered for all

Work underway at several new homes in eastern Louisville Metro.
Work underway at several new homes in eastern Louisville Metro.
Bob Thieneman
Bob Thieneman
Janet Kelly
Janet Kelly
Workers on the assembly line at Ford.
Workers on the assembly line at Ford.
A new home under construction in Louisville.
A new home under construction in Louisville.

LOUISVILLE, KY (WAVE) – Five years after the collapse of Lehman Brothers and the resulting financial collapse, Louisville's economic recovery has benefited many but has left others behind.

Mayor Greg Fischer, citing U.S. Bureau of Labor Statistics data, highlighted that the Metro has regained all 42,000 jobs lost during the recession.

While the jobs are back, in many cases, wages and benefits are not the same as they were said Janet Kelly, executive director of the University of Louisville's Urban Studies Institute. Additionally, unskilled workers or those with less education are having trouble finding work, she said.

"The recovery is going to be very difficult for those people who don't have a degree and don't have a skilled trade," Kelly said. "We're in uncharted territory, because this recovery has been very slow."

The Metro's unemployment rate has ticked upward over the past few months, to 8.2 percent, as more people who once grew discouraged with the job market start looking for work again, Kelly said.

"You can actually see job growth and rising unemployment at the same time and that's a factor of people coming back into the work force," said Kelly.

Lehman Brothers' bankruptcy in September 2008 marked the end of a red-hot housing market, in which banks lent to people who, in many cases, couldn't afford the homes they were buying.

Many U.S. homes went into foreclosure, and fewer people could get a loan as credit markets tightened.

Louisville-area builders struggled through the next few years, with some turning to remodeling work to make ends meet. Bob Thieneman, president of the Home Builders Association of Louisville, said others went out of business.

"Within the past six months, builders have begun to feel comfortable enough that (the recovery) is here to stay," Thieneman said. "But they're still being very conservative on any hires that they're making."

Building permits in Louisville are on pace to match the number of permits taken out in 2008, according to data from the builders' association.

"Confidence is coming back," Thieneman said. "We were off 80, 85 percent from the best (times) to where it dropped."

Some builders are now finding a shortage of skilled workers, such as in plumbing, heating and air conditioning, and trim, he said.

Meanwhile, manufacturing has added the most jobs in Louisville of any industry, according to federal data. Manufacturers have added about 14,000 jobs in the past three years, the data indicate.

Kelly said that should be expected because of how many manufacturing workers lost their jobs during the recession.

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