Good morning, local leaders. This daily economic intelligence digest is crafted specifically for cities that reject outdated strategies, bureaucratic inertia, and yesterday’s economic development approaches. Realistic, actionable, and clearly stated, we’ll equip you to make proactive, informed decisions today.

Labor Market Steady Amid Trade War Fears

The U.S. job market is still hanging tough. New unemployment claims rose slightly to 222,000 last week – a minor uptick that keeps layoffs historically low for now. Orders for durable goods jumped 9% in March, but that was almost entirely thanks to a one-time surge in aircraft orders (take away planes and business spending was flat). In other words, factories got a temporary boost from Boeing and friends, while broader business investment remained cautious. And no wonder: Washington’s on-again, off-again tariff war is whipsawing corporate plans. The White House recently cranked tariffs on Chinese imports up to a jaw-dropping 145%, unsettling companies that rely on global supply chains. Even the Treasury Secretary admitted these sky-high tariffs are “not sustainable,” a rare D.C. acknowledgment that the trade battle may be reaching a breaking point. For now, Wall Street is betting this pressure might force a truce – but on Main Street, manufacturers and exporters are nervously watching their costs climb.

Why This Matters: A resilient labor market means your city’s workers are still employed and spending money, which is good news for local businesses and tax revenues – at least for the moment. But those trade war tremors from D.C. could hit home soon. If your local economy includes manufacturers, farmers, or logistics firms, they may be facing higher costs and uncertain foreign markets thanks to shifting tariffs. City leaders should be preparing: identify which employers are exposed to these import/export issues and engage with them now. This is also a reminder to double down on economic diversification – if one industry takes a tariff-induced hit, you want others picking up the slack. And importantly, avoid adding local burdens on businesses during this volatile time. Cutting any unnecessary red tape at the city level can give your entrepreneurs a fighting chance to offset higher federal trade costs. In short, the job scene is okay today, but storm clouds loom; proactive cities will shore up their roofs before the rain starts.

Housing Market Slump Continues as Rates Bite

The spring housing market was supposed to bloom, but instead it’s looking pretty wilted. Sales of existing homes across the U.S. plunged 5.9% in March from the month before – the biggest one-month drop since 2022 – catching many experts off guard. More owners have been listing homes, and spring is usually peak season, so what gives? In one word: mortgages. After easing a bit early this year, mortgage rates have jumped back to around 6.8% for a 30-year loan, putting a damper on buyers. In fact, an uptick in bond yields (fueled partly by those tariff jitters in the financial markets) pushed borrowing costs up right when buyers were starting to poke their heads out. With the typical home now costing over $400,000, those higher rates are a one-two punch that many first-time buyers or moving families simply can’t afford. As a result, would-be sellers are staying put (why trade a 3-4% old loan for a near-7% new one?), and the housing market remains stuck in low gear. Interestingly, one segment is doing okay: new home sales actually rose about 7% in March. Builders are managing to sell more newly built houses, perhaps by offering incentives or simply because there aren’t enough existing homes for sale and buyers are giving up and going to the developers.

Why This Matters: When homes aren’t changing hands, your city can feel it. Slower home sales mean fewer people moving into the community for jobs, fewer upgrades to larger homes as families grow, and potentially less churn in property tax revenue growth. It can even affect local businesses – if people aren’t moving, they’re not buying new furniture, renovating houses, or stimulating the local real estate industry. The fact that mortgage rates are the culprit here suggests a challenge that local officials can’t directly control, but you can respond to it. One response is to accelerate the approval of new housing projects. The bump in new home sales shows that buyers are still out there; they’re just gravitating toward any fresh supply that comes available. If your city can make it easier for builders to construct houses or apartments (by simplifying permitting and zoning), you can attract those buyers and boost your housing stock at the same time. Also, be mindful of the “lock-in” effect – many of your residents feel stuck in their current homes due to low past interest rates. Policies that help people renovate or expand in place, or targeted programs to assist first-time buyers, can keep the housing ladder from freezing entirely. Finally, resist the urge to slap on heavy-handed measures like rent control (more on that next): the real cure for a housing funk is more supply, not artificial price caps. Encouraging development and homebuilding now will pay off in a more dynamic, affordable local market down the road.

NYC Comptroller Pushes Rent Freeze Amid Housing Crunch

In New York City, the housing affordability drama reached another peak: the city’s Comptroller, Brad Lander, just called for a complete rent freeze for the coming year on about a million rent-stabilized apartments. In testimony on April 24, he argued that with a housing emergency still raging – soaring rents and not enough units – the city should halt any rent increases for tenants in stabilized units to keep people in their homes. This stance is a big deal in the ongoing tug-of-war between tenant advocates and landlords. Tenant groups are cheering, seeing a rent freeze as needed relief after several years of sharp rent hikes in the city. Landlord groups, on the other hand, are apoplectic, warning that if their costs (think property taxes, heating oil, repairs) keep rising while rents are locked, building maintenance and investment will suffer. New York has some of the nation’s strictest rent regulations already, and this would be an unprecedented step to tighten them further. The Rent Guidelines Board will make the final call later this year, but the political pressure is on to “do something” about housing costs in the Big Apple – even if that something means essentially forcing owners to eat inflation costs for a year.

Why This Matters: City leaders everywhere are grappling with housing affordability, and many might be tempted by what New York is proposing – essentially a government-mandated timeout on rent increases. But be careful what you wish for. Freezing rents may provide temporary breathing room for some renters, but it can also freeze your housing market in all the wrong ways. If landlords in your city start fearing that they won’t be allowed to get a return on upgrades or even cover rising expenses, they will cut back on maintenance and shy away from building new rental units. In the long run, that means a shabbier housing stock and fewer places to live – exactly the opposite of the stated goal. New York can perhaps get away with more heavy regulation (for now) because it’s New York, but most cities really can’t afford to scare off housing investment. The real lesson here is the importance of addressing the root cause: lack of supply. Tenants are desperate and politicians reach for blunt tools like rent freezes when the market is ridiculously tight. A smarter city leader will channel that energy into expanding housing options: encourage development of new apartments, allow accessory dwelling units and duplexes, convert underused offices to residences – whatever it takes to increase choices for renters. That alleviates pressure without the side effects. In short, New York’s rent freeze debate underscores how severe the crisis is, but it also shows what not to do if you want a healthy, growing housing market. Protecting property rights and promoting building might not be as immediately gratifying as a freeze, but it sure sets your city up better in the long term.

Congress Targets Zoning Barriers to Spur Housing Growth

You know the housing shortage is on everyone’s mind when Congress – yes, Congress – actually gets bipartisan about it. On April 24, lawmakers from both parties reintroduced the Housing Supply Frameworks Act, which is essentially Uncle Sam’s way of nudging local governments to loosen up those antiquated zoning rules. This bill directs the Department of Housing and Urban Development to come up with model zoning policies that cities and states could adopt to allow more housing construction. Think of it as a 21st-century template replacing a playbook that hasn’t changed much since the 1920s. Why is this happening? Because the nation is short an estimated 4 to 7 million housing units, and even folks in Washington have realized that overly restrictive local codes – minimum lot sizes, bans on multifamily housing, excessive parking requirements, you name it – are a big culprit. Instead of a top-down mandate (which would never fly politically), this approach is more carrot than stick: provide guidance, share best practices, maybe tie some federal grants to progress, and otherwise empower localities to reform on their own terms. The proposal already has a strange-bedfellows coalition of supporters from housing advocates to real estate industry groups, all basically saying, “Please, let’s make it easier to build homes.” The idea is that by cutting through zoning red tape, cities can unleash private investment to build the apartments, condos, and starter homes that communities desperately need.

Why This Matters: This development is a green light for local leaders who know they need to overhaul zoning but feared the backlash. If Congress moves forward, cities will have cover – and likely resources – to revisit those sacred cow regulations that have been preventing growth. For a mayor or city council, can having a federal framework to point to (“look, these are proven best practices nationwide”) help push past NIMBY opposition that derails necessary zoning changes? More concretely, embracing the spirit of this act means updating your rules to allow things like duplexes in single-family zones, apartment buildings near transit lines, and quicker approvals for projects that meet community standards. The free market thrives on opportunity, and right now outdated zoning is suffocating opportunity in housing. By proactively aligning your city code with the forthcoming federal guidelines, you position your community to attract developers ready to build. And more housing development doesn’t just help homebuyers and renters; it creates construction jobs, expands the tax base, and can revitalize underused areas of the city. The key point: you don’t have to wait for this bill to pass to get started. City leaders can begin cutting needless regulations now – the wind is at your back. In an era when even Washington sees the value of local deregulation to solve a problem, you know it’s time to act. Cities that streamline and welcome growth will reap the rewards of more affordable living and a stronger economy.

Auto Supplier Expansion Brings 500+ Jobs to Michigan

Here’s some heartland good news: Michigan just landed a manufacturing and tech double-play that will create over 500 jobs, and it didn’t happen by accident. On April 24, Governor Gretchen Whitmer announced two business expansions choosing Michigan over other states. First up, auto supplier Norplas Industries (a division of Magna International) is beefing up its operations in Highland Park (an enclave of Detroit) to the tune of about 500 new jobs. They’re investing roughly $7 million to add capacity, after winning new contracts that need fulfilling. At the same time, an R&D company called HL Mechatronics is purchasing and building out two facilities in Bay County (near Bay City) for its advanced automotive electronics work, adding about 43 high-paying engineering jobs. Why did both pick Michigan? The state offered a sweetener or two (performance-based grants for job creation, job training support – the usual toolkit) and importantly, Michigan has the workforce and automotive heritage these firms need. In fact, HL Mechatronics considered expanding at a sister site in Alabama, but ultimately decided to grow in Michigan because of the talent pipeline and strong local partnerships with universities and training programs. In short, Michigan’s aggressive pitch and existing strengths won the day, and now two communities – one in metro Detroit, one in mid-Michigan – are celebrating new opportunities and investment.

Why This Matters: When was the last time 500 new jobs just dropped into a city’s lap? It does not just happen; it’s the result of competitive hustle. The lesson for city leaders is that being proactive and business-friendly gets results. Highland Park isn’t exactly a booming suburb – it’s had its struggles – but by working with state officials and the company, they secured an investment that will give the area a significant economic boost. Hundreds of manufacturing jobs at around $24 an hour mean more local spending, more stability for families, and even a reduction in social service strain as people gain steady employment. Bay County, on the other hand, is getting fewer jobs, but they are very high skill, high wage positions in cutting-edge automotive tech – seeding future growth in a sector every region wants a piece of. Both cases show the importance of welcoming innovation and industry: Michigan leveraged its universities and training programs to supply the engineers and technicians these companies need. For your city, think about your own strengths – be it a skilled labor pool, strategic location, or even available real estate – and market them relentlessly. Also, take a page from Michigan’s playbook: streamline your approval processes and be ready to offer reasonable incentives when a solid employer comes knocking. While we all respect free markets, remember that other cities and states are aggressively courting the same employers; you need to show that your community will cut through bureaucracy and get shovels in the ground fast. If you don’t, someone else will. The bottom line is that growth goes where it’s wanted. These 500 jobs could have landed in another state or even overseas, but smart, swift action kept them here. Make sure your city is just as ready to pounce on the next opportunity.

Downtown Office Distress Deepens in Big Cities

If your city center is looking a bit emptier lately, you’re not alone – it’s a nationwide trend that just keeps getting more pronounced. New reports show nearly 1 in 5 office spaces across the U.S. is vacant, and in some major cities the situation is even more dire. San Francisco, Austin, Seattle – all tech-heavy hubs – are seeing roughly 28% of their offices sitting empty as remote work and corporate downsizing continue to reshape the landscape. This is not a temporary blip; office usage has been stuck at roughly half of pre-pandemic levels for well over a year now. Many companies have embraced hybrid setups permanently, and every week we hear about another big employer shedding office space to cut costs. The result? A surge in “distressed” office properties (a polite way to say buildings whose owners are defaulting on loans or facing foreclosure). In 2024 alone, about 25 million square feet of office space fell into distress – nearly 40% more than the average in the years prior. Landlords who bought skyscrapers assuming full occupancy are now struggling to refinance or sell as values plummet. Case in point: a large office complex in suburban Chicago that sold at auction recently for a big discount compared to its value just a few years ago, signaling how far expectations have fallen. Construction of new offices has basically been put on ice (down 50% from a year ago), which is actually a welcome pause to let oversupply shrink. Still, the overall picture for downtown real estate is sobering: the era of the jam-packed office tower is not coming back anytime soon.

Why This Matters: For city governments, high office vacancy isn’t just a real estate story – it hits the urban economy at its core. Fewer workers in offices means less foot traffic for downtown retailers, restaurants, and service businesses. It also threatens city budgets: if office buildings drop in value, property tax assessments will eventually follow, squeezing a revenue source that many cities rely on heavily. We’re talking potentially millions in lost revenue that fund schools, police, and parks. So what’s a city leader to do? Adapt and repurpose. The faster cities can pivot to support alternative uses for vacant office buildings, the better. Some downtowns are already converting empty offices into apartments or condos – addressing the housing shortage while filling dark windows, a two-birds-one-stone move. Others are turning offices into co-working spaces for startups, classrooms for universities, or labs for biotech firms. These conversions aren’t easy – zoning laws, building codes, and financing hurdles can slow things down – but that’s exactly where leadership comes in. If ever there was a time to hack away at bureaucratic inertia, this is it. Streamline the permits for conversions, offer temporary tax breaks for property owners who invest in rehabbing old offices, and reimagine zoning in the central business district to allow mixed-use flexibility. Also, ensure your economic development teams are courting growth industries (like life sciences, creative arts, etc.) that could take up some of that slack downtown. This office glut is a challenge, but it’s also an opportunity to reinvent city centers for a post-pandemic economy. Cities that cling to the old “office-first” vision might find themselves with a hollowed-out core, while those that facilitate change can create a more resilient, diversified downtown that doesn’t rely on 9-to-5 commuters alone.

Green Bay Hotels Cash In as NFL Draft Nears

How’s this for a supply-and-demand lesson: Green Bay, Wisconsin (metro population barely above 320,000), is about to host the 2025 NFL Draft – and every hotelier in town is licking their chops. With thousands of football fans set to flood into the city for the multi-day draft festivities at Lambeau Field, local hotels have hiked their prices into the stratosphere. Rooms that might normally go for a reasonable rate are being advertised for triple, even quadruple, the usual price. Even at those rates, good luck finding a vacancy anywhere near the action. This is the first time Green Bay has hosted an event of this magnitude outside of a Packers game, and the limited number of hotel rooms in the area has created a literal overnight gold rush for anyone with a bed to sell. Fans are booking up lodgings as far away as Milwaukee or Appleton just to have a place to stay. For Green Bay’s hospitality sector, it’s an all-out bonanza: local restaurants, bars, and shops are gearing up for what could be a record-breaking weekend of sales. The city itself will see a nice influx of tourism dollars and national media coverage to boot. Of course, for visitors on a budget, the situation is less rosy – if you didn’t book months ago, your wallet is going to feel the pain or you’ll be watching the draft from your couch instead.

Why This Matters: Big events can be economic game-changers for mid-sized and smaller cities, but they also highlight growing pains. On the plus side, Green Bay will enjoy a surge of revenue and visibility that most cities of its size can only dream of. This is the kind of boost to the local economy that can justify investments in infrastructure or be a selling point to attract future events. However, the extreme hotel rate spike is a reminder that market forces can lead to public relations challenges. City leaders hosting large events need to manage the narrative: some folks will cry “gouging,” but imposing price controls or other heavy-handed measures would be a mistake that undercuts the very free-market dynamism that makes these events attractive. A better approach is advance planning and facilitation. If your city is eyeing a major sporting event or convention, work early with regional partners to expand lodging options – encourage residents to list spare rooms or homes on vacation rental platforms, bring in temporary accommodations (like cruise ships or pop-up hotels) if feasible, and make sure transportation from farther-out hotels is seamless. These efforts can increase effective supply so that prices don’t spiral too far out of hand. The Green Bay experience also shows the importance of investing in the capacity to host big events: more hotels, better transit, upgraded venues. If done right, your city can reap the rewards (and yes, profits) while still keeping visitors happy. Ultimately, an event like the NFL Draft can put a city on the map and leave lasting benefits – but only if local leaders embrace the free-market influx with smart planning rather than fighting it. Green Bay is cashing in this week; forward-thinking cities will ask how they can be next.

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