How Boise beat the national unemployment rate


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    Boise, Idaho, construction worker Dave Checkitts is back to his trade laying hardwood floors, and making $16/hour, after years of struggling to make ends meet delivering pizza and doing other odd jobs.

    - Mitchell Hartman

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    New homes going up at the Harris Ranch subdivision in Boise, Idaho.

    - Mitchell Hartman

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    44th Street Wineries in Garden City, Idaho, minutes from downtown Boise, is home to three urban wine cellars: Cinder (winemaker Melanie Krause at right), Telaya and Coiled.

    - Mitchell Hartman

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    Winemakers and staff of three urban wineries in the Snake River Valley: Telaya Wine, Coiled Wine, and Cinder Wine.

    - Mitchell Hartman

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    Travis Hunter of Boise Hunter Homes outside a new model home in the Harris Ranch development. Houses like this are on the market for $299,000. Several more are under construction nearby.

    - Mitchell Hartman

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    Micron Technology headquarters in Boise, Idaho. The company just built a multi-million-dollar R&D facility here.

    - Mitchell Hartman

With unemployment at 7.9 percent in January, the U.S. economy has a long way to go to return to anything resembling ‘full employment.’ Economists debate what that would be -- a base-level structural unemployment rate at which any employable person who wanted to work, could find a job, given time. The consensus settles around 5 percent to 5.5 percent.

The Federal Reserve’s Open Market Committee has set its target rate of ‘healthy’ unemployment at 6.5 percent, at which point it will begin to tighten monetary policy and raise interest rates that are now being maintained at historic lows to encourage hiring, consumer spending and business investment.

But some places in the U.S. have already managed to push local unemployment down to more palatable levels.



Where to get a job? See what unemployment looks like in your state and how it compares to the rest of the country in this interactive map.


Boise, Idaho, is one such place that finds itself sitting in the Fed’s ‘unemployment sweet spot.’

Boise sits in an idyllic valley in Southwestern Idaho, snow-capped mountains at the horizon. Nearly half of Idaho’s population of 1.5 million lives in this remote corner of the state, known as the Treasure Valley, where tributaries like the Boise, Payette and Owyhee feed into the Snake River.

The region doesn’t have oil fields, or a lot of corporate headquarters, or foreign car plants. What it has is a little bit of this, a little bit of that: a major hospital and Boise State University; state government; tech firms large and small; plus timber, ranching, and potato farming.

And, lately, you can hear the sounds of hammers and nailguns on the outskirts of town.

The local economy has a pulse once more. Homebuilders that survived the recession and housing crash -- which was as severe here as in other Western boom towns like Las Vegas and Phoenix -- are putting up single-family homes again.

Boise Hunter Homes has several on the market in the Harris Ranch subdivision along the Boise River about 15 minutes from downtown. They’re nicely-appointed, three- to four-bedroom homes with hardwood floors, hickory cabinets, granite countertops, double-shower master baths. All starting in the low-$300,000-range.

All over the valley, builders are putting up starter homes, trade-up homes, and McMansions in suburban subdivisions that were platted and plumbed, then went to weeds, when housing went bust in the recession.

Dave Checkitts works for Idaho Hardwood Flooring on the Harris Ranch building site. “I’m making $16 an hour right now,” he says. “During the recession, when building stopped, I was doing whatever I could -- delivering pizzas. Making ends meet was a hard thing to do. This is my trade, this is what I’m trained to do. Seeing this come back -- you make a living wage.”

Construction is a virtuous cycle. Guys like Checkitts can go out for dinner, even buy a new truck, because lawyers and nurses and small-business owners are buying new homes again.

At the very least, working people are living less in fear of the economic apocalypse, now, says Marci Glass, pastor of Southminster Presbyterian Church in Boise. Glass serves a neighborhood of lower-middle-class families living in modest ranch homes. Many are near retirement. She says the neighbors were in a world of hurt during the recession.

“A number of them have been dealing with foreclosures and unemployment -- long-term unemployment,” says Glass. “Insecurity with jobs, whether at Micron or Hewlett-Packard, fear of layoffs: are they going to make it through the next round? I think there is a sense now that things are getting better for the parishioners that I serve.”

“Boise is very fortunate, Boise is growing,” says Bill Connors, chief local business booster, CEO of the Boise Metro Chamber of Commerce. He offers a visitor a ‘downtown- skyline-tour’ from the windows of his high-rise office: “If you look off to the left, you see two huge cranes going up. We’ve got a 20-story high-rise going up over here for Zion’s Bank, and a big project for the Simplot Corporation. We’re one of the fastest-recovering cities in the country, our regulatory environment is one of the best.”

Connors says companies like Boise -- and Idaho -- because of the quality of life, affordable housing, and laissez-faire business climate. “Last year, we lowered corporate income taxes and individual taxes,” Connors brags. “Not too many states are doing that right now.”

What’s happened here in Boise -- unemployment dropping from 9.4 percent at its worst in mid-2010, down to just 6.2 percent in December of 2012 -- isn’t miraculous. It’s steady growth of a diversified economy fueled by low interest rates, high technology, and local talent.

It helps to have a corporate heavyweight to anchor that growth. The 800-pound Fortune-500 gorilla here is Micron Technology, one of the top memory-chip-makers on the planet.

Company spokesman Daniel Francisco led this reporter on a tour of a new global research and development center on Micron’s sprawling glass-and-steel campus just minutes from downtown Boise. “This is what we call the sub-fab,” Francisco explained as we descended a flight of stairs under the 50,000-square-foot complex of gleaming new clean rooms full of technicians scurrying around in bunny suits. “We’re underneath where the R&D manufacturing’s occurring. You have the gas sources, power sources, drains here.”

Micron spent millions to build this new facility. Francisco says it will pump wages and wealth into the local economy. It will also attract highly educated scientists and engineers from San Francisco, Boston, Bangalore.

But Micron only employs around 5,000 people in Boise now. It used to employ 10,000. The company downsized in the recession, laying off thousands of high-paid production workers and managers from an outdated chip fab. Hewlett-Packard also shed workers in the past few years.

Bill Connors says some laid-off tech professionals picked up stakes and headed for bigger high-tech hubs with more job opportunities -- the Bay Area, Seattle, Portland. “But what’s interesting,” says Connors, “is a lot of people didn’t want to leave. So they started up their own little start-ups here in town.”

One example: a cluster of new urban wineries that have opened in a cavernous warehouse in Garden City, a few minutes’ drive from downtown Boise. The décor at the Telaya, Cinder, and Coiled cellars is industrial chic. The wines they’re making are respectable reds and whites -- appellation ‘Snake River Valley’—made with local grapes that like the cool winters and warm summers, along with a dry, sandy soil resembling some regions of California.

Winemakers Leslie Preston of Coiled and Melanie Krause of Cinder were both raised in Boise, traveled abroad after college, then settled down at top-flight wineries in California and Washington to learn their trade.

Krause says she had three criteria for coming back home to start a business and a family: “One was that I had to feel that I could make world-class wine here,” she says. “The second was business climate -- and we thought there was a very good opportunity here. The third was lifestyle, and the lifestyle here is great.”

Krause’s husband, Joe Schnerr, used to be an analytical chemist at Micron Technology. Then came the great downsizing -- he took a buyout and a pay cut. Now, he sells wine in the tasting room.

“This is a dry Viognier,” he says, introducing one of the winery’s specialties. “So you should have a bright, aromatic white wine, but it’s going to finish crisp. I think that shows the Snake River Valley in Idaho really well.”

So, another sound of success can be heard here, in the local wines being poured at hip downtown restaurants packed with prosperous urban professionals. People with discretionary income who are living it up and spending again.

About the author

Mitchell Hartman is the senior reporter for Marketplace’s Entrepreneurship Desk and also covers employment.

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