Archive for Thursday, July 23, 2009

City’s economy grades ‘just OK

Revenue, home sales and jobs down, but Lawrence not ‘bad’ by comparison

July 23, 2009

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The midterm grades on the Lawrence economy are in, and the community put up lower marks in four of the core subjects.

Through June, Lawrence saw a decline in sales tax revenue, home sales, new construction and job totals compared to the first six months of 2008.

But in a refrain that parents of school-age children have heard for years, the results look better when you grade on the curve.

“Generally, it is not great here, but it also is not bad in comparison to other parts of Kansas or other parts of the Midwest even,” said Tom Kern, Lawrence Chamber of Commerce president. “I’m grateful that things are just OK here instead of bad.”

Crunching numbers

Here’s a look at some key numbers from a bevy of midyear reports that have been released recently:

• Retail sales: Sales tax collections are up in Lawrence for the first six months of the year, but that is because voters in April agreed to add 0.55 percent to the sales tax rate. When you factor out the new money that is coming in from the new rate, Lawrence’s totals are down about 3.2 percent for the year.

That’s in contrast to a surprisingly good year in 2008, when sales tax collections grew by 3.8 percent. City Hall leaders aren’t expecting that type of turnaround this year.

“We’re probably hoping to be flat at best,” said Ed Mullins, the city’s director of finance. “Last year was really a pleasant surprise. We may not manage much, if any, growth this year.”

• Unemployment: The number of people unemployed in Douglas County has grown by more than 1,000 people since June 2008. According to the latest statistics from the state, the unemployment rate in June was 6.2 percent, up from 4.3 percent in June 2008. That rate is still below the statewide rate of 7 percent. It also is below Topeka’s rate of 6.7 percent, Wichita’s at 8.5 percent, and Kansas City’s at 7.3 percent. It is above, however, the unemployment rate in Manhattan, 4.6 percent.

• Home sales: According to the Douglas County Appraiser’s office, there have been 772 real estate sales in the county during the first six months of the year. That’s down 19 percent from the same time period a year ago. The average selling price for existing residential homes is down about 6.6 percent to $185,000. But leaders with the Lawrence Board of Realtors said there are positive signs in the market. The group estimates there are about 200 fewer homes on the market than last year. As a result, homes are starting to sell quicker. The average length of time on the market has been 43 days, down from 67 days a year ago. New homes, however, continue to have an average length of time of about 180 days on the market, down from about 215 a year ago.

• New construction: Building permit totals are down in almost every category except apartment construction. In the single-family and duplex market, the number of permits are down by about 22 percent. Lawrence is on pace to issue less than 80 single-family and duplex permits for the entire year. To put that in perspective, for more than a decade Lawrence added more than 300 single-family homes each year.

Construction woes

Kern said the construction numbers are the most troubling statistics to him.

“For a long time, construction had been the second or third largest-employment sector in this community,” Kern said. “That is the part that really concerns me. We have all these skilled trade folks related to construction. There is a real human story there in addition to the economic story.”

Bobbie Flory, executive director of the Lawrence Homebuilders Association, said the city’s construction industry has shrunk, but she declined to give an estimate.

“We have heard from several businesses who have said they are taking a break,” Flory said. “They aren’t building anymore.”

Flory said longtime builders in the community say the downturn in the industry is worse than what the community experienced in the early 1980s when interest rates were in the double digits.

“If you would have told me five years ago that we would have building permit totals that are below 40, I would have said ‘not in Lawrence, Kansas,’” Flory said. “We thought people would always want to live here.

“But we all think, we all hope, that once the economy improves we’ll be as desirable as we have been in the past.”

Comments

Chris Ogle 6 years, 1 month ago

“If you would have told me five years ago that we would have building permit totals that are below 40, I would have said ‘not in Lawrence, Kansas,’” Flory said. “We thought people would always want to live here.

Lets face it..... It cost more to live in Lawrence, and Lawrence really isn't that special..

sarahsmilehawk 6 years, 1 month ago

It doesn't cost that much to live in Lawrence. It's more expensive than Topeka or Wichita, but it has less crime and is les... icky. It's less expensive than most other parts of the country, and probably less expensive than most towns with large state universities.

gl0ck0wn3r 6 years, 1 month ago

Time for Lawrence to reap the rewards of Hecklernomics. That tax on the poor for the T is looking pretty smart right now. How about those expensive "traffic calming devices?"

monkeyhawk 6 years, 1 month ago

"Lets face it….. It cost more to live in Lawrence, and Lawrence really isn't that special.."

In the words of merrill (spoken in his most arrogant NPR voice) "Hear, Hear".

Many of the people I know living in Lawrence would love to leave.

"and probably less expensive than most towns with large state universities." Check it out - virtually every city with a university has a much higher cost of living. I'll leave it up to you to figure out why.

Chad Collins 6 years, 1 month ago

Let's forget about the article for a moment. Can we please take another "stock" picture of downtown that doesn't include the Mizzou dork? Seriously!

jengaman 6 years, 1 month ago

Amen to that snoopy_79 - first thing I noticed.

1029 6 years, 1 month ago

Can somebody send the LJ-W a new picture of downtown? Is this the only one they have? Why do they keep using it over and over again for various downtown-related stories?

GardenMomma 6 years, 1 month ago

I've noticed it as well. You'd think after all the comments about the picture that a Mr. Jonathan Kealing would address the issue or at least pass along the comments.

Or perhaps, the LJW keeps using the same photo to see how many people comment on it? : )

GardenMomma 6 years, 1 month ago

I see the picture is now down.... wonder why.

OldEnuf2BYurDad 6 years, 1 month ago

"but Lawrence not ‘bad’ by comparison"

But, when the overall economy stinks, we really need Lawrence to be "good by comparison".

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