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New report compares Lawrence's economy to others in the region; latest numbers show local economy shrank in 2011

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Watch out Cleveland, Tenn. We’re right on your heels.

What? When you think of cities similar to Lawrence, you don’t think of Cleveland, Tenn.? What’s that? You don’t think of Cleveland, Tenn. — population 42,000 people along the Ocoee River — at all. Well, by one standard, that city is our closest of kin.

The U.S. Bureau of Economic Analysis recently released its annual report on the size of local economies. (They call it the Gross Domestic Product for metropolitan areas, but it basically is just a measurement of all the economic activity in a community.)

I normally find the report interesting because it reminds me of something that we perhaps forget from time to time. We’re small — at least when it comes to the size of our business community.

The latest report — which measures 2011 economic activity — shows Lawrence had an economy of $3.56 billion. That ranked Lawrence 339 out of the 366 metro areas.

That’s where we are ranked currently. We won’t be ranked there long, unless we start to see a rebound. The BEA report found Lawrence’s economy actually shrank in 2011 by 1.7 percent. (Note: The BEA uses some inflation-adjusted dollars to determine if an economy has grown or shrunk. Without that inflation adjustment, we grew a bit.) The negative 1.7 percent growth rate ranked us 338 out of the 366 metro areas. We also were well below the average growth rate for a metro area, which checked in at 1.6 percent.

But back to our cousins in Cleveland. I mention them because we have the 339th largest economy in the country and Cleveland has the 338th largest. So — if like all great coaches say — you take ’em one at a time, Cleveland should be our next aspiration.

I’m, of course, just having a little bit of fun here. Cleveland and Lawrence aren’t much alike. Cleveland likely would gladly take our major research university, and Lawrence probably would take Cleveland’s batch of industrial businesses: Coca Cola, M&M Mars, Dr. Scholl’s foot products, Tappan appliances, Duracell Batteries, and something called Catnapper recliners. There are a lot of different ways to have a $3.5 billion economy.

But what is interesting about the BEA list is just how much smaller Lawrence is — at least in economic size — to several other cities that we compare ourselves to. A few that jumped out at me included Columbia, Mo. Columbia has an economy of $6.91 billion compared to Lawrence’s $3.56 billion. Even Joplin, Mo., is quite a bit bigger than Lawrence, checking in at $5.97 billion. But the one that really stuck with me was — you guessed it — Manhattan. The home of Kansas State University has an economy of $6.5 billion. Manhattan’s economy is nearly twice as large as Lawrence’s. That seems hard to believe, but that is what the numbers show. While that sinks in, here’s a look at several other cities of interest:

• Lawrence: $3.56 billion in 2011. Rank: 339

• Ames, Iowa: $4.24 billion; Rank: 309

• Austin, Texas: $90.91 billion. Rank: 34

• Boulder, Colo.: $19.35 billion. Rank 111

• Columbia, Mo.: $6.91billion. Rank 218

• Fort Collins, Colo: $12.0 billion. Rank 159

• Iowa City: $7.90 billion. Rank: 208

• Joplin, Mo.: $5.97 billion. Rank: 246

• Kansas City, Mo./Kan.: $108.1 billion. Rank 26

• Lubbock, Texas: $10.53 billion. Rank: 173

• Madison, Wis.: $36.52 billion. Rank: 63

• Manhattan: $6.5 billion. Rank: 230

• Oklahoma City: $60.99 billion. Rank: 46

• St. Joseph, Mo.: $4.67 billion. Rank: 296

• Springfield, Mo.: $15.38 billion. Rank: 133

• Topeka: $9.50 billion. Rank: 187

• Waco, Texas: $8.75 billion. Rank: 198

• Wichita: $27.36 billion. Rank: 82

As I’ve already mentioned, Lawrence did not do well in terms of its GDP growth in 2011. (There were signs of some positive economic activity in 2012 and they continue in 2013, so perhaps next year’s report will show a reversal in fortunes.) One-year growth rates always should be taken with a grain of salt, but here’s a look at some in our region:

• Lawrence: negative 1.7 percent Rank: 338

• Ames: 3.2 percent Rank: 42

• Austin: 4.4 percent. Rank: 20

• Boulder: 3.6 percent. Rank: 31

• Columbia, Mo.: 1.7 percent. Rank: 117

• Iowa City: 3.5 percent. Rank: 34

• Joplin: 0.1 percent. Rank: 234

• Kansas City: 0.0. Rank: 243

• Manhattan: 5.0 percent. Rank: 17

• Topeka: 1.0 percent. Rank: 160

• Wichita: 0.5 percent. Rank: 209

What about our cousins in Cleveland, you ask? Well, their economy grew at a 3.5 percent rate in 2011. Yes, that will make it a little more difficult to catch them, but don’t worry. We’re talking about a town that makes Coca-Cola, M&Ms candy and comfortable recliners. We’ll catch ’em because at some point they’re going to have to take a break to go to the cardiologist.

Comments

tomatogrower 1 year, 4 months ago

Chamber of Commerce's business is no longer attracting businesses. It's pushing tea party legislation, and maintaining and increasing the perks for existing businesses. Do you really think our local businesses want to bring in companies that pay good salaries? Of course, not. Then they would have to compete. And who are the members of the Chamber? We really should start to organize a different group that wants to attract business to Lawrence. And a group who will look for businesses that pay a living wage, and not just more retail part time jobs.

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Rae Hudspeth 1 year, 4 months ago

I'd love to see the comparison of wage levels.. pretty sure that has a lot to do with the individual economies. Very interesting article. That town has half the population and the same economy, with way more industrial employment, I'll bet.

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tomatogrower 1 year, 4 months ago

Hmm. there are a lot of cities who did support "smoke stack" industries and now have died, when that industry was shipped over seas.

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deltaman 1 year, 4 months ago

Again, congrats to the PLC and the no growther's who won the past decade. I trust this is the result you wanted, a declining economy and a median income for Lawrence that is $10,000 below that of Manhattan.

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jack22 1 year, 4 months ago

I know right? I thought all those tax breaks for our local developers were supposed to help stimulate our local economy. I guess adding a bunch of new apartment buildings was only a short term fix. As this report illustrates, our haphazard approach to growth and development certainly hasn't served us well. Maybe we should reserve our tax incentives for those businesses that bring in new industry and offer better paying jobs?

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average 1 year, 4 months ago

The 'progressives' were a majority on the city commission for 2 years, over a decade ago now, out of 60 years of 'rah rah growth (if it can line my pockets)' Chambercrat commissions. Like the outgoing one. Like the incoming one.

If you can't tell the difference, you might want to go in for an eye exam.

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Carol Bowen 1 year, 4 months ago

No growthers did not discourage industry. Our city leaders wanted clean service industry like telemarketing and retail.

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TheBigW 1 year, 4 months ago

What do you expect for a town that tries it's hardest to run off businesses big & small. Oh WTH lets hand another 10K to clueless, doing a heck of job there "brownie".

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TheBigW 1 year, 4 months ago

Get a clue, my comment has nothing with laying the full blame on D.Clueless, rather it has everything to do with this City and it's lame good old boys running the show handing out piles of cash when the results of the performance suck! I don't believe he deserves a 10K raise, in fact I think not only he needs to be fired, but pay he was making was way too much.

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tomatogrower 1 year, 4 months ago

And making sure businesses who pay well don't get a chance. Haven't you tea party anti-Obama conservatives gotten a clue yet? Companies want a high unemployment rate. That way they can pay what they want and not provide benefits, because people are desperate for work. It's called supply and demand. I thought you guys were well versed in that philosophy. So why would local businesses, who pretty much control our local government to attract more, and higher paying businesses? Where's the incentive for their bottom line, which is all they care about.

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Richard Heckler 1 year, 4 months ago

Bear in mind the local Chamber of Commerce aka lobbyist for the real estate industry and their soldiers (elected officials and planning commission) in government have been running the show in Lawrence,Kansas for at least the greater majority of the past 35 years.

Their elected soldiers will be running the show for the next few years recklessly spending tons of tax dollars in the same tired fashion all the while telling taxpayers it is planning for the future.

Adding more and more miles of new infrastructure and adding more and more and more bedrooms to this bedroom community and further saturating the retail market will continue to produce the same negative results all the while telling taxpayers it is planning for the future.

While continuing to live in the city hall of denial.

FYI - Economic Displacement will never produce new Economic Growth

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scaramouchepart2 1 year, 4 months ago

Lawrence can no longer live by development, of any kind, anymore. About 2004 I was told that as long as their was building, not jobs or businesses Lawrence would be ok. There are relatively easy fixes if Lawrence were willing to admit the 80's are over. We need to cater to those who live here and not try to bring businesses that we do not have the Job skill sets. One great change is Lawrence is developing plans with 2 schools to have a brick and mortar training school. We have to go and market ourselves to companies that fit our job skill sets. Incubator business for graduate students instead of them moving to Chicago or elsewhere. Programs that help people keep a business going as the owners retire. Yes there are such programs. Improve regional transportation to help retired and people come to work here. BUT number one - jobs that pay enough to live here. We have to get over the unspoken agreement to keep pay low. Most of the building we've incentivized has provided part time jobs and that don't pay the rent in Lawrence. There are many other economic ideas that we can do, but we have to change the way we think. Just like every community that is weathering these times.

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Carol Bowen 1 year, 4 months ago

Bedroom communities cannot sustain themselves. Building more residential units is not helping our local economy. Yes, there will be construction jobs for awhile, but that is short term thinking. The city has to set a direction. It's too small to go in many directions. Bedroom community vs independent city. Athletics, blue collar, academic, seniors, whatever. We need focus.

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chootspa 1 year, 4 months ago

Everyone who lives in Lawrence knows that there are better jobs and better chain store shopping a small drive away. All those cities that you compare us to, including Manhattan, are bigger because they aren't right next door to the big cities.

If you want to grow the Lawrence economy, don't focus on Olive Gardens or M&M plants. The truth is that we can't compete with those bids, and the chain stores just dry up when they realize how unwilling the locals are to shop here.

Cultivate the small businesses that sell unique and artsy items you can't get at the chain stores. Set up cheap office space with high speed Internet for tech startups downtown. Shut down Mass street to cars on Thursdays and Saturdays in the summer and make it a tourist destination. Leverage the one thing we have a lot of in this town: college students and graduates.

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