Trumbull County key economic indicators
By LARRY RINGLER / Tribune ChronicleHeading into the final frenzy of Christmas shopping, 2009 has been more naughty than nice to Trumbull County's economy, leaving most people with visions of prunes instead of sugar plums dancing in their dreams as they sleep.
But despite Warren's position most of the year as the city with the state's highest jobless rate and continued soft auto sales after the brief Cash for Clunkers surge, some hopeful signs are emerging, albeit with heavy government stimulus. Housing sales are giving hints of stabilization, both in units sold and median price, and even the jobless rate has improved in recent months.
The stock market has surged for most of the year, perhaps setting the table for a holiday shopping feast that will fill Trumbull County's stockings with plenty of sales tax dollars.
Following are brief looks at some of the area's most critical economic sectors:
Housing
Something strange has begun in the Trumbull County housing market - bidding wars for homes, and the battles may intensify next year.
The trigger? An $8,000 tax credit for first-time homebuyers that has been extended until April 30, plus a new $6,500 tax credit for current homeowners who have been in their residence for at least five years.
The result, according to Yvonne Smith, broker with Eaton Group GMAC Real Estate in Howland, is ''some bidding wars, especially for moderately priced homes around $100,000 in good condition. There are a lot of first-time buyers in that range.''
The importance of the tax breaks was shown by soft demand the first two weeks of November as potential buyers and lenders pulled back because the first-time buyer credit was set to expire.
''Everyone was holding their breath,'' Smith said. ''A lot of banks and mortgage companies said they couldn't guarantee they could get the loan closed by the end of November.''
Congress responded by giving buyers until April 30 to sign a purchase agreement, then sweetened the deal by including a break for some current homeowners wishing to make a move. The buyer has until June 30 to complete the purchase.
''Once they extended the program, the phones started ringing again,'' Smith said, noting the current homeowner provision could boost sales by 15 percent in the next quarter.
Besides drawing buyers into the market, the existing homeowner break will bring more ''solid'' houses onto the market, Smith said.
''That has been part of the problem. Before, we had a lot of (Housing and Urban Development) and (bank-owned properties), which are hard to sell because they need work,'' she said.
Housing sales are seen as the economy's ultimate driver because buyers then purchase furniture, carpeting, even Christmas lights for their new home, Smith said.
Auto sales
New-vehicle sales are on a ''little softer pace'' in November at Warren's Klaben Crown Ford Lincoln Mercury after the dealership's 79.2 percent surge in October, President Mike Klaben said.
''People are very budget-minded,'' said Klaben, whose dealership posted Trumbull County's only significant increase in new-vehicle sales in October with 43 versus 24 in October 2008. Preston Auto Mall was the other county dealer with a year-over-year gain at 2 percent.
Klaben noted used-vehicle sales are a bit stronger than new, suggesting buyers are showing sensitivity to price in the wake of the government-fueled Cash for Clunkers buying spree in August.
The Ford dealership is benefiting from good consumer quality reports and the company's ability to skirt bankruptcy, unlike GM and Chrysler.
Sims Buick GMC Nissan in Warren paced all Trumbull County dealers in October with 46 new sales, although that was down one-third from a year ago. It also topped the county in new and used sales with 96, off by 24 percent.
Sparked by demand for the new GMC Terrain sport utility vehicle and Buick midsize LaCrosse car, Bill Sims said sales this month are on a better pace than a year ago, when the dealership also led the county in new-vehicles sales with 69.
''With the new incentives and products from Buick and GMC and Nissan, we're optimistic about the way the month will end,'' he said, adding that customers also seem to be gaining some confidence in the economy and GM.
Unemployment
Warren's ninth-straight month as the city with the highest jobless rate in the state reinforced the area's image as one especially hard hit by the Great Recession. But that's only the tip of the grim economic iceberg, according to a Cleveland economic analyst.
At a negative 27.1 percent, Trumbull County ranks worst in percentage of total job losses among the state's 88 counties during what George Zeller considers one long recession between the first quarters of 2000 and 2009. The percentage translates into 25,366 positions that have gone poof out of the 93,768 the county started with in 2000.
''All counties in the region lost employment, but the massive size of Trumbull County losses has been horrible,'' Zeller said.
To drill down further, the county ranks second worst in manufacturing jobs lost from the first quarter of 2001 to the same quarter in 2009 at 65.1 percent, or 21,976 jobs out of 33,758.
But the county actually is the worst when studying only major manufacturing counties. Muskingum County, the only county below Trumbull, started the decade with just 11,690 industrial jobs.
The job losses hit especially hard in Trumbull's plummeting payroll. Zeller calculated the county has seen the state's worst percentage decline in total payroll among major counties at 41.3 percent, or an ''extremely alarming'' $1.64 billion from the first quarter of 2000 to the first quarter of 2009.
The loss of manufacturing jobs played the biggest role in the payroll losses because those jobs average $50,466 versus $38,431 for nonmanufacturing jobs, Zeller noted.
''The widespread dismantling of Ohio's most important industry created a major catastrophe in the state,'' he said. ''In short, Ohio is experiencing an economic disaster of historic proportions.''
Bill Turner, work force administrator for the Trumbull County One-Stop jobs office, agreed, saying the seasonal service sector can't ease the pain of losing high-paying manufacturing jobs that provide steady income.
''We need sustainable jobs,'' he said.
Sales tax
Trumbull County Auditor Adrian Biviano said he tries to follow the under-over rule when budgeting permissive sales tax income for the county: underestimate revenue, overestimate expenses.
That philosophy is helping officials deal with a painful contraction in sales tax dollars that Biviano said he's never before seen going as far back as 1994.
''This year is the most dramatic decline we've had at the 1 percent tax rate,'' he said of the nearly 10 percent drop in tax dollars from sales of everything from candy to clothes to cars for the year through November.
Biviano said that he last year projected the county would get $19.3 million in tax dollars, about $2 million less than in 2008 and a number that looks doable with one month of receipts left. He said he's figuring on getting about the same in 2010.
Monthly sales tax receipts have lagged the year-ago income for all 11 months this year, according to county numbers. The closest they came to beating the prior year was a nearly 3 percent decline in March from March 2008, when the county got Christmas sales tax dollars. The biggest shortfall was 20.5 percent in July.
The tax crunch shows the importance of money management for county departments, Biviano said.
''We've had great cooperation from the unions, who have agreed to wage freezes, and we're asking them again to contribute to stabilize the budget and keep delivering services to the public,'' he said.
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Swelterstat
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11-29-09 12:34 PM
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George... the problem is the people at the top Dont Live in the Real world like most working people. they have better health insurance why wouldnt they,they get pays we could never see. also they live by a seconm d set of rules.....unlike us the working people who live pay to pay and hope and pay we will still have jobs the next day..its a very sad day for this great country. the way things have run down hill and the saddist of all it hasnt just been under the watch of one its been many..may GOD BLESS AMERICA Because thats the only way we will make it.
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george
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11-29-09 9:12 AM
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I used to employ people in 5 area payday loan stores until the genius state legislators lead by Robert Hagan and supported by Capri Cafaro threw us out. I am now in Florida living and paying taxes. The idiots at the top should take most of the blame for killing Trumbull County.
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