Christmas is coming, so I'd like to give you good news about the local economy. Unfortunately, I'm not finding it.
As the Madison Daily Leader reported last week, unemployment in Lake County jumped from 5.8% to 7.0% in October. According to the state Department of Labor, we actually added 90 jobs in October, but our workforce numbers surged by 185, meaning a net increase in the number of unemployed folks of 95. Only June this year saw more people on the streets in Lake County looking for work.
On the good side: the LAIC is now down only 220 jobs from employment levels at the beginning of its Forward Madison program in October 2006. Only 660 new jobs to create to meet program goals by the the beginning of 2012!
(I'm not the only one wondering how the LAIC could have done so little with its Forward Madison money: Gale Pifer asks a similar question about big LAIC funding and declining job numbers in a Madison Daily Leader letter to the editor this week.)
My usual yardstick: land of milk and honey Brookings County also saw an increase in unemployment in October, from 3.2% to 3.4%. They added 355 jobs, but saw the workforce grow by 410.
In other grim economic news, Madison's October sales tax collections dropped over 20% compared to collections in the same month last year. All of Lake County saw gross sales of $48,361,717.36 in October this year. In October 2008, the conty saw gross sales of $61,754,272.25.
Things are tough all over: seven of the ten biggest towns in South Dakota saw sales declines. Among that group, Brookings saw the worst slide from last year, down 9.5%. Overall, 132 out of 228 communities reported October sales tax declines. But note: Deuel County economic development maven Briana Hoffman reports that the mighty metropolitan area of Gary has done more business in the first ten months of 2009 than it did in all of 2008.
A sliver of Madison sales hope: I dropped by Radio Shack in Madison the other day to look at computers. They had just one machine in stock: "Hot Friday" sales cleaned them out!
I remain torn. If sales are down because people are choosing to buy less and save more, that's great! But if locals are buying less because they're out of work and living off savings, well, then I just might add a tear to the LAIC's beer.
We're certainly in a period of flux right now, economically. The decline in primary and secondary jobs in Madison is the number one reason sales are down.
ReplyDeleteInternet sales are cutting into local taxable sales and state sales tax revenue in a larger way than most are willing to admit. The State and Cities need to legislate collection of those vital sales tax dollars from internet retailers. It's costing us millions each year in South Dakota.
Competition and consumer choice are two components that have trended against us in the last ten years. We had three grocery stores, but now have one. We had a half-dozen women's clothing stores, but now have one plus the chain stores. Two lumberyards dwindled to just one. We had four new car dealers, but now have one.
I think many people are really trying to shop at home, to keep the dollars circullating, but our consumer choices are more limited than ever. Shoppers require choices, and if your hometown doesn't provide enough choices, people go elsewhere to compare.
This ship can sail strong again, but we need new jobs, more jobs, a second grocery store and more retail choices on mainstreet. We also need a plan with teeth and measurable goals.
Gehl has had the largest ripple effect on Madison since John Morrell closed in the 60's. It not only affected hundreds of families, it affected several related firms who relied on Gehl for most of their work.
One area that hasn't declined is the number of insurance agents in Madison. Do we really need 25 agents in a town of 6000?
Competition as a driver of growth: hear hear!
ReplyDeleteAnd too many insurance agents? I'll resist my urge to spin a variation of "too many lawyers" jokes. How'd we get all these agents? Is there less entry cost to starting one's own insurance business than other ventures?
Cory: Today's Argus Leader, page 6B, discusses Future Sioux Falls' plan to attract viable businesses and services. This is timely, as we're all wondering which types of business or services to attract, and who will grow coming out of the recession.
ReplyDeleteFour key areas of growth include 1) Medical Research, 2) Wind Turbine and Bio Fuels, 3) Warehouse & Distribution and 4) Corporate and Data Services including skilled financial customer care and information assurance centers.
I hope LAIC and its board pay close attention to the results of this $200,000 project, as Sioux Falls' results mirror our future as well. Can we provide land, buildings and employees locally who can enhance the employers Sioux Falls is attracting?
The game has changed and we have to be willing to change quickly to adjust to the market and grow jobs and income in Lake County. Perhaps we are evolving into a secondary or support job provider rather than primary.
Rod, I offer this suggestion with no snark toward you whatsoever: we should reduce the number of insurance agents in town by at least one: throw you out of your office... and put you in charge of the LAIC. You are reading and researching (that Anna Bahney writes some good stuff), you are questioning the status quo, and you are offering practical ideas (even if they do include that darned call center you'd like to snag). I hate to hitch our star totally to the secondary/support model and relying on Sioux Falls's success; we need to keep looking for the things we can do on our own for independent success and economic security. But we're silly not to take what advantage we can of the big economic engine just down the road.
ReplyDeleteMaybe I'll end up on board with the Highway 34 expansion project yet: tie it to industrial expansion at James River Equipment, get them to start selling John Deere wind turbines, get Dakota Ethanol to expand its operations to produce cellulosic ethanol....