Waccamaw Regional Economic Outlook Spring May 27, Rob Salvino Coastal Carolina University
Executive Summary The winter quarter (December, January, and February) showed continued growth in residential construction and tourism activity along the Grand Strand. Single family home construction permits were up 22.5 percent for the quarter, continuing to outpace the state and nation in volume growth. Home prices have posted moderate gains, but their pace lags that of the nation. Employment growth was consistently positive across all three counties (Horry, Georgetown, and Williamsburg); however, the Bureau of Labor Statistics annual benchmarking of labor force data created significant downward revisions to the level of employment for Georgetown and Williamsburg Counties over the last five years. Note the slides detailing the changes inside this report. Nationally, the major development is the continued drop in oil prices and the impact on the energy industry and related sectors. The fallout should be isolated to these industries, and we expect little impact on the Grand Strand economy. Retail sales may be temporarily affected negatively as they reflect lower gasoline prices. This should be offset in the coming months by stronger consumer spending power, mostly impacting the beach economies.
Helpful Notes and Reminders Tourism Quarters: To reflect the importance of the seasons, offset by 1 month so that (Winter) is December, January, February, (Spring) is March, April, May, (Summer) is June, July, August and (Fall) is September, October, November. National data is based on normal calendar year, e.g. GDP 1 st quarter is for January, February, March. All data reflect the period of business activity, unless otherwise noted. Receipts and collections of tax revenue by SC DOR may not coincide with period of business activity, e.g. retail sales business activity shows quarterly spikes; however the actual business activity may not resemble this periodic behavior. Reported and estimated changes in rate measures are reported as unit changes rather than percent changes, for example the unemployment rate movement from 6% to 6.5% is shown as a movement of one-half of a point (0.5). In November, SC DOR received a ruling to aggressively pursue taxes on VRBO properties as far back as ten years. The reporting does not adjust for the actual period of business activity and is reflected in the period of collection.
Annualized Real GDP Growth (%) 6 5 4 3 2 1 0-1 -2-3 -1.5 2.9 0.8 4.6 2.3 1.6 2.5 0.1 2.7 1.8 4.5 3.5-2.1 4.6 5 2.2 0.2 1.7 3 Source: U.S. Department of Commerce: Bureau of Economic Analysis
US Economy and Recession Risk Capacity Utilization Rate 85.0 82.5 80.0 77.5 75.0 72.5 70.0 67.5 65.0 92 94 96 98 00 02 04 06 08 10 12 14
Oil Prices and Recessions Falling oil prices rarely, if ever, cause recessions (never since 1913). Rising oil price shocks have caused several. Sources: Finn, Mary (1991). Energy Price Shocks, Capacity Utilization, and Business Cycle Fluctuations, Discussion Paper 50. Institute for Empirical Macroeconomics, Federal Reserve Bank of Minneapolis. https://www.economy.com/dismal/analysis/datapoints/252580/can-lower-oil-prices-trigger-a-us-recession/
South Carolina Employment (Millions) 2.10 2.05 2.00 1.95 1.90 1.85 1.80 1.90 1.94 1.96 1.95 1.94 1.98 2.00 1.99 1.97 2.01 2.04 2.02 2.01 2.06 2.07 2.06 2.06 2.07 2.08 Source: Bureau of Labor Statistics
Benchmarking of Labor Force Data 0 5000 10000 15000 20000 25000 30000 35000 1992M01 1992M09 1993M05 1994M01 1994M09 1995M05 1996M01 1996M09 1997M05 1998M01 1998M09 1999M05 2000M01 2000M09 2001M05 2002M01 2002M09 2003M05 2004M01 2004M09 2005M05 2006M01 2006M09 2007M05 2008M01 2008M09 2009M05 2010M01 2010M09 M05 M01 M09 M05 M01 M09 GtownEmpPreBench GtownBench
Benching of Georgetown Unemployment Rate 0.00 2.00 4.00 6.00 8.00 10.00 12.00 14.00 16.00 18.00 20.00 1992M01 1992M08 1993M03 1993M10 1994M05 1994M12 1995M07 1996M02 1996M09 1997M04 1997M11 1998M06 1999M01 1999M08 2000M03 2000M10 2001M05 2001M12 2002M07 2003M02 2003M09 2004M04 2004M11 2005M06 2006M01 2006M08 2007M03 2007M10 2008M05 2008M12 2009M07 2010M02 2010M09 M04 M11 M06 M01 M08 M03 M10 UratePreBench UrateBench
Williamsburg Employment Benching 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 1992M01 1992M08 1993M03 1993M10 1994M05 1994M12 1995M07 1996M02 1996M09 1997M04 1997M11 1998M06 1999M01 1999M08 2000M03 2000M10 2001M05 2001M12 2002M07 2003M02 2003M09 2004M04 2004M11 2005M06 2006M01 2006M08 2007M03 2007M10 2008M05 2008M12 2009M07 2010M02 2010M09 M04 M11 M06 M01 M08 M03 M10 prebench bench
Williamsburg Urate Benching 0 5 10 15 20 25 1992M01 1992M08 1993M03 1993M10 1994M05 1994M12 1995M07 1996M02 1996M09 1997M04 1997M11 1998M06 1999M01 1999M08 2000M03 2000M10 2001M05 2001M12 2002M07 2003M02 2003M09 2004M04 2004M11 2005M06 2006M01 2006M08 2007M03 2007M10 2008M05 2008M12 2009M07 2010M02 2010M09 M04 M11 M06 M01 M08 M03 M10 prebench bench
MYR Airport Deplanements (Thousands) 400.0 350.0 300.0 250.0 200.0 150.0 100.0 50.0 0.0 110.7 239.4 337.2 196.8 108.4 200.5 264.3 172.2 104.9 224.3 309.3 191.6 106.7 245.2 328.0 192.8 108.8 248.0 337.0 Source: Myrtle Beach International Airport
Georgetown Port Tonnage (Thousands) 200.0 180.0 160.0 140.0 120.0 100.0 80.0 60.0 40.0 20.0 0.0 75.1 95.0 114.2 138.3 177.0 109.0 153.3 114.0 119.7 125.5 154.0 139.2 116.8 118.1 186.4 155.5 72.5 145.4 188.9 Source: Georgetown Port Authority
Hotel-Condotel-Campground Occupancy Rate 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 26.3 54.1 77.3 41.1 28.3 57.5 78.6 40.7 29.9 56.1 83.3 44.8 31.4 57.6 82.5 49.8 30.1 58.0 83.0 Source: Clay Brittain Jr. Center for Resort Tourism
Hotel-Condotel-Campground Average Daily Rate 180.0 160.0 140.0 120.0 100.0 80.0 60.0 40.0 20.0 0.0 54.9 90.7 136.7 67.3 54.6 98.3 142.7 66.7 53.1 97.3 147.0 67.3 52.6 93.0 152.1 70.7 52.2 97.0 155.0 Source: Clay Brittain Jr. Center for Resort Tourism
Horry 1.5% Hospitality Fee Revenue ($Millions) (County-wide fees on accommodations, prepared foods, beverages, admissions) $18.0 $16.0 $14.0 $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 $3.2 $7.0 $13.8 $5.9 $3.6 $7.7 $14.2 $6.3 $3.7 $7.8 $15.2 $6.3 $3.8 $8.2 $15.9 $6.7 $4.3 $8.7 $16.5 Source: Horry County Government
Accommodations Tax Revenue ($Millions) $14.0 $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 $1.0 $3.6 $9.8 $2.8 $1.3 $5.8 $10.4 $2.3 $1.7 $4.1 $11.2 $3.0 $1.4 $4.3 $11.6 $3.3 $1.4 $4.6 $11.7 Source: SC Department of Revenue
5% State Admissions Tax ($ Millions) $5.0 $4.5 $4.0 $3.5 $3.0 $2.5 $2.0 $1.5 $1.0 $0.5 $0.0 $1.0 $2.6 $4.3 $2.0 $1.2 $2.9 $4.0 $1.7 $1.2 $2.9 $4.4 $1.9 $1.1 $2.8 $4.3 $1.7 $1.1 $2.8 $4.2 Source: SC Department of Revenue
Regional Single Family Permits 1200 1000 800 600 400 200 0 314 419 461 343 368 582 621 579 580 803 697 662 657 876 1009 794 805 987 1099 Source: HUD State of the Cities Data System
Regional Multi-family Permits 600 500 400 300 200 100 0 7 34 6 539 244 34 39 16 25 158 41 271 186 29 116 243 71 91 90 Source: HUD State of the Cities Data System
Regional Retail Sales ($ Millions) 3500 3000 2500 2000 1500 1000 WILLRETAIL GTOWNRETAIL HORRYRETAIL 500 0 Source: SC Department of Revenue
Georgetown Retail Sales ($ Millions) 500 450 400 350 300 250 200 150 100 50 0 303 286 369 293 268 356 396 304 281 350 409 313 281 364 426 341 297 367 441 Source: SC Department of Revenue
Williamsburg Retail Sales ($ Millions) 180 160 140 120 100 80 60 40 20 0 133 154 122 132 139 144 134 137 145 145 150 143 154 157 143 148 149 157 143 Source: SC Department of Revenue
Regional Employment Breakout (Thousands) 140.0 120.0 100.0 80.0 60.0 40.0 WILLEMP GTOWNEMP HORRYEMP 20.0 0.0 Source: Local Area Unemployment Statistics, Bureau of Labor Statistics
Georgetown Employment (Thousands) 25.0 24.0 23.0 22.0 21.0 20.0 19.0 21.3 22.3 22.8 21.9 20.8 21.7 22.3 21.8 20.9 21.8 22.5 21.9 21.3 22.5 23.5 23.3 23.1 23.5 24.1 Source: Local Area Unemployment Statistics, Bureau of Labor Statistics
Williamsburg Employment (Thousands) 12.5 12.0 11.5 11.0 10.5 10.0 9.5 9.0 11.1 11.3 11.3 11.0 10.5 10.4 10.6 10.4 10.8 11.0 11.1 11.0 11.0 11.2 11.7 11.7 11.7 11.9 12.2 Source: Local Area Unemployment Statistics, Bureau of Labor Statistics
Georgetown Unemployment Rate 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 15.4 13.2 13.0 12.9 14.1 11.9 11.5 10.6 12.3 10.1 9.7 9.0 9.5 7.6 8.1 8.1 9.2 7.3 7.7 Source: Local Area Unemployment Statistics, Bureau of Labor Statistics
Horry Unemployment Rate 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 14.4 11.6 10.6 11.4 13.2 10.2 9.4 9.3 11.4 8.5 7.9 7.8 8.6 6.5 6.8 7.2 9.0 6.5 5.7 Source: Local Area Unemployment Statistics, Bureau of Labor Statistics
Williamsburg Unemployment Rate 20.0 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 17.3 15.5 16.7 17.0 17.9 15.8 15.7 14.4 14.8 12.6 12.9 11.5 11.1 9.5 10.0 9.4 10.1 8.9 8.6 Source: Local Area Unemployment Statistics, Bureau of Labor Statistics
Regional Economic Outlook Board: Spring Presented to: The Waccamaw Regional Council of Governments' Regional Economic Outlook Board Prepared and Presented by Dr. Rob Salvino, Research Economist, Center for Economic and Community Development E. Craig Wall Sr. College of Business Administration, Coastal Carolina University May Value Percent Change from Previous Year Previous Current Next Previous Current Next Quarter Quarter Quarter Quarter Quarter Quarter Winter Spring Summer Winter Spring Summer Airport Deplanements (thousands) 108.8 248.0 337.0 2.0 1.1 2.7 Port Tonnage (thousands) 72.5 145.4 188.9-37.9 23.2 1.3 Occupancy Rate (Full Week) 30.1 58.0 83.0-1.3 0.4 0.5 Average Daily Rate (Full Week) $ 52.2 $ 97.0 $ 155.0-0.4 4.0 2.9 Horry County 1.5% Hosp. Fee Revenue ($millions) $ 4.3 $ 8.7 $ 16.5 13.6 6.5 3.5 Accommodations Tax Revenue ($millions) a $ 1.4 $ 4.6 $ 11.7-4.4 5.7 1.1 Admissions Tax Revenue ($millions) $ 1.1 $ 2.8 $ 4.2 7.7-1.2-2.2 Regional SF Building Permits* 805 987 1,099 22.5 12.6 8.9 Regional MF Building Permits* 71 91 90-61.8 214.6-22.4 Retail Sales ($millions) Georgetown County $ 297.1 $ 367.4 $ 441.3 5.7 1.0 3.5 Horry County $ 1,908.4 $ 2,521.9 $ 3,259.4 7.1 4.2 3.2 Williamsburg County $ 148.5 $ 157.0 $ 143.0-3.3-0.2 0.2 Employment (thousands) Georgetown County 23,104 23,475 24,128 8.7 4.3 2.7 Horry County 118,357 128,010 133,819 4.1 3.2 2.2 Williamsburg County 11,743 11,930 12,183 6.6 6.5 4.4 Unemployment Rate Georgetown County 9.2 7.3 7.7-0.3-0.3-0.3 Horry County 9.0 6.5 5.7 0.4 0.0-1.1 Williamsburg County 10.1 8.7 8.6-1 -0.6-1.5 Notes: Spring quarter is March - May, Summer is June - August, Fall is September - November, Winter is December - February. Retail Sales, Accomodations Tax Revenue and Admissions Tax Revenue represent the period of business activity. For example, Accommodations Taxes for Summer represent the business activity incurrec during the Summer quarter. Percent change from previous year is relative to the same quarter from the previous year. For example, percent change for Summer 2010 is the percent change between Summer 2009 and Summer 2010. Rate given is absolute change for: Occupancy Rate, ADR and Unemployment Rates. For example, the given change for the Occupancy Rate during Summer 2009 is simply the Summer 2010 Occupancy Rate minus the Summer 2009 Occupancy Rate. a SCDOR received a ruling in November allowing it to more aggressively pursue tax from VRBO properties. Monthly reporting may include back payments from last 10 years. Regional Economic Outlook: May Questions may be directed to Dr. Rob Salvino, 843-349-2719, rsalvino@coastal.edu