Chamber of Commerce CEO confident despite lagging job growth, high taxes
It wasn’t a very “chamber of commerce” thing to say. A chamber president is traditionally a community’s top salesperson. But here was a letter from Lawrence’s new chamber president and CEO that sure didn’t do much to sell Lawrence’s blue skies and green parks. Instead, Larry McElwain told chamber members earlier this month what he has learned thus far in his seven weeks on the job: The community’s taxes are high and rising, the city has few job opportunities and a high cost of living, some residents feel marginalized by community leaders, instability with the chamber’s CEO position has hindered the chamber’s ability to lead, and residents are hungry for community leadership to emerge.
McElwain — a Lawrence fixture since the mid 1960s — clearly has decided now is not the time for a sales pitch.
“I think we have a lot of work to do right now,” McElwain said. “And if you are not saying what people already realize — like taxes are high and they are going up — then you are going to lack credibility in leading them to a different place.”
But here’s the key part: McElwain is confident the community can end up in a better place.
“I feel a hunger out there for something better than we have done,” McElwain said. “I don’t feel like I’m buried under a pile of rocks and can’t get out.”
But getting to a different place might require a gritty process. Or, as McElwain says: “I don’t have trouble taking the varnish off.”
In that vein, I decided it might be a good time to look at some key community statistics related to issues such as jobs, incomes and growth. It seems like the community is at a natural point for some reflection. We have a new chamber CEO, and the city and the county also are in the beginning stages of updating Horizon 2020, the community’s comprehensive plan.
Among the many chapters in Horizon 2020 is one on economic development. That chapter lists goals related to both jobs and income. How have we done? Well, let me get out my 50-grit sandpaper: When it comes to jobs and income, it has been a lost decade for Lawrence and Douglas County.
There were fewer jobs in Douglas County at the end of 2013 than there were in 2003, according to figures from the U.S. Bureau of Labor Statistics. That wasn’t the goal in Horizon 2020. Depending on where you look in the document, you see different goals for job growth. One was to add 20,000 jobs in the county by 2020. It was a little unclear when we were supposed to start counting, but let’s go all the way back to 1990. There were about 40,000 jobs in the county in 1990. In 2013, we had 46,402.
Another goal was for jobs to grow at a rate equal to or greater than the county’s population growth. That should be an easier goal to reach because Lawrence and Douglas County are not growing anywhere near as rapidly as we used to. In the 1950s Lawrence’s population grew by 41 percent; 39 percent in the ’60s; 15 percent in the ’70s; 24 percent in the ’80s; 22 percent in the ’90s. When the 2010 Census came out, it showed Lawrence’s growth rate for the decade of the 2000s was 9.4 percent. The county’s was 10.8 percent.
Over the past decade, the county’s job growth has been negative 1.1 percent.
Perhaps this sandpaper is a bit too coarse for your liking, and you note that the last 10 years did include the largest economic downturn since the Great Depression. Maybe our job growth numbers aren’t as bad as they look, given that fact. So, I did a quick comparison with a few other counties. During the same time period: Johnson County had job growth of 10.6 percent, Riley County had job growth of 15.6 percent, Wyandotte County had job growth of 10.8 percent, Sedgwick County struggled but had job growth of 1.3 percent.
Then there was Shawnee County, home to Topeka, which has been the punchline of many jokes that have come from Lawrence over the years. It had negative job growth of 1 percent, just slightly better than Lawrence’s showing.
On the subject of incomes, Horizon 2020 had a less detailed goal: “Increase the career opportunities and income of Douglas County citizens through the attraction of high skilled jobs.”
That doesn’t create a specific measurement for success, but I figured that most people could agree that incomes should grow equal to or above the rate of inflation. From 2000 to 2012, median incomes have failed to keep up with the rate of inflation, according to data from the Census Bureau.
In 2000, the Census Bureau found Douglas County’s median household income was $37,547. In 2012, a Census estimate put it at $48,395. But if you put those numbers into a government run inflation calculator, you find that the median household income in Douglas County needed to be $50,794 to keep up with inflation. Our 2012 median income is about 5 percent less than what it needs to be to keep up with inflation.
Another way to look at it, average Douglas County households basically took a 5 percent pay cut during the past 12 years. If it makes you feel better, Douglas County isn’t alone in that boat. Even mighty Johnson County’s income didn’t keep up with inflation. But of course, they had more of it to start with.
“That’s pretty discouraging,” McElwain said of the numbers.
But they don’t have to be defining, he said. That’s the past, and it doesn’t have to be the future. But they do mean that we’re going to have to work harder to add more businesses to our community. Businesses pay a property tax rate that is more than twice as much as residential property. Lawrence’s tax base needs to include more businesses, said McElwain, who owned Lawrence’s Warren-McElwain Mortuary for about 40 years.
“It is not just that I want to change it,” he said. “It has to change. We can’t just keep building libraries and Rock Chalk Park and things we want or need without expanding the tax base.”
McElwain said he and others have been working to craft a new economic development plan for the community. It is expected to be presented to community leaders in the coming weeks. McElwain said it wouldn’t abandon the idea of trying to attract companies from other parts of the country to locate in Lawrence. But he said there would be a much greater emphasis on helping existing Lawrence businesses expand, and much more effort to help budding entrepreneurs.
“I believe we’ll be readjusting our top priorities,” McElwain said. “My top priorities will be to pay more attention to the underemployed and the unemployed. And helping start-up endeavors will be very important.”
None of this is to say that community leaders have done nothing to try to bolster jobs and incomes in the county during the past decade. The city, the county and Kansas University all have made major investments to build a new incubator on West Campus aimed at helping promising technology and bioscience start-up firms. That effort has expanded to facilities in West Lawrence as well.
After decades of lawsuits, the South Lawrence Trafficway is under construction, and economic development leaders predict the new transportation options it creates will cause companies to look at Lawrence anew.
The city is completing the final bit of infrastructure work at LawrenceVenture Park, which will be the city’s newest industrial park. It is on the eastern edge of town along Kansas Highway 10 on property that used to house the Farmland Industries fertilizer plant. It will be very near the SLT, and the park is being pitched to prospects now. Theoretically, that park could produce a new job announcement any day.
“If we could have success in the next year, it would be such a shot in the arm,” McElwain said. “I think we have kind of forgotten what success is.”
McElwain said the community’s vibe does feel different than it did in the ’70s, ’80s and ’90s. He said there seems to be less of an overall vision for the community.
“I think we have lost our focus a bit,” McElwain said. “It seems like all of us have gotten more worried about what is going on in our little worlds and not looking at the whole enough.”
If we do refocus, I wonder what we’ll see. It is easy to get overdramatic about these issues of jobs and incomes and such. I even found myself saying that a community can survive one lost decade, but it probably can’t survive two. That was silly to say. If Lawrence goes another 10 years without adding jobs or growing its income, it will survive. The city still will have people, Kansas University still will have students, and we all still will have KU basketball.
So, we’ll survive, but that surely is not our ultimate goal. The question seems to be, what is?