THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, January 1, 1996 TAG: 9512300294
SECTION: BUSINESS WEEKLY PAGE: 04 EDITION: FINAL
TYPE: Column
SOURCE: Ted Evanoff
LENGTH: Medium: 84 lines
When news reporters last week asked Tidewater retailers about December sales, many merchants sounded less than enthusiastic. ``Our holiday sales were a little soft,'' said Jim Cundiff, manager of J.C. Penney's department store at Military Circle Mall in Norfolk.
Say what you will about high consumer debt, the deployment to Bosnia, or the furlough of the federal workers, but sluggish holiday sales seemed unusual for Tidewater.
Although the big cities such as New York, Washington and Los Angeles are mired in slow job growth, some of the best leading indicators for the Hampton Roads economy have looked robust for months.
New jobs, tunnel traffic, car registrations, commercial construction permits - these gauges surpassed '94 levels throughout the summer and fall.
If retail sales were soft, two factors seem to stand out.
The number of stores in Tidewater has grown almost 75 percent in a decade, but the total civilian payroll, adjusted for inflation, has increased less than 25 percent since '85.
Tidewater employers are creating jobs. They're creating them at a rate faster than Virginia's, faster than the nation's.
Nearly 639,500 civilian positions were filled in October on the Peninsula and the southside, about 1.9 percent more than a year earlier. The growth rate placed Hampton Roads 109th in job creation among the 288 metropolitan areas throughout the country ranked by Arizona State University's Economic Outlook Center.
Almost all Tidewater's job growth was centered in three industries. Construction, retail and service companies hired about 16,000 more workers compared to '94. Meanwhile, factories, utilities and especially federal government offices shed 4,000 workers.
Hampton Roads' net gain of 12,000 jobs was a respectable showing. The sheer number exceeded the volume of new jobs created in the same months in Charlotte, equaled Raleigh and Durham, and slightly trailed Richmond.
While Tidewater has created plenty of jobs, they tend to pay less than the lost jobs. Look at the Virginia Employment Commission's survey of June 30, the most recent industry payroll analysis available from the state.
Average weekly wages in Hampton Roads were $750 for utility workers, $695 for federal workers, and $628 for factory workers, each far above the $445 Tidewater average for all civilian workers, the June 30 survey shows.
Factor those averages wages into the 4,000 lost jobs and it's as if Tidewater has lost an annual payroll of $120 million. In terms of the region's total annual civilian payroll, about $14.5 billion in '95, that's pocket change.
Pocket change or not, it hurts - shut down the 2,000-employee Ford pickup truck assembly plant in Norfolk for 15 months and the lost payroll would approach $120 million.
Where did most new jobs appear? In the service and retail sectors - they together accounted for about 13,500 new jobs, with the service industry providing the lion's share, almost 10,000 jobs. Construction firms added 1,700 workers.
In both the service and retail industry, average wages lagged the $445 regional average. Retail workers averaged $242 a week in the June 30 survey, service workers $400.
There were significant gains in service sectors with high average wages. Engineering firms ($631 average in the June 30 survey) added almost 1,400 workers, and the health fields ($515 average in the June survey) brought on 1,200 workers.
But most new service jobs were in lower wage sectors.
For example, almost 3,500 workers were added in the business services field ($315 average in the survey), which includes temporary help agencies.
Social services ($244 average in the survey) added almost 1,100 workers. Hotels and motels ($400 average in the survey) hired 800 more workers.
Keep the 16,000 workers added in '95 on the payroll for a year and their annual income will surpass $350 million. That's a lot of money. But soft holiday sales are no wonder.
While the total annual civilian payroll has climbed to almost $14.5 billion in Hampton Roads, compared to about $8.5 billion a decade ago, that $8.5 billion had a buying power of almost $12 billion expressed in today's money.
We're a wealthier community, but not a great deal wealthier. Meanwhile, the number of retail outlets has swelled - almost 7,500 today, 4,300 a decade ago. A lot more merchants are scrambling for a limited pool of dollars.
KEYWORDS: EMPLOYMENT by CNB