Local economic development experts assess 2013
Published: December 27, 2012
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For Jeffrey Box, president and chief executive officer of NEPA Alliance, has one wish. “My hope is that Washington gets its collective act together so that business in northeast Pennsylvania, as well as the rest of country can start growing again without the uncertainty of taxes and the deficit affecting their business decisions. My prediction is that they will get their act together and that we’ll soon see some progress.”
Box said NEPA Alliance has struggled in recent months to generate interest in its small business loan programs because of the uncertainty about the economy and those big commitments that the business needs to make when they’re borrowing money.
On a different note, in 2013, Box sees Hurricane Sandy reigniting interest in moving business operations from the New York metro area to Northeast Pennsylvania. He said that goes for residential moves, as well. “My view is that many times in history when we’ve seen experiences like that storm it forces a lot of people, business leaders and just residents to rethink where we live and why. We’re certainly not immune to our own environmental issues in northeast Pennsylvania, but when you look at the map, we’re in a great proximity to the New York/New Jersey metro area for residential growth again and also for business relocations.
“Everyone in economic development has talked for years about the lower cost of living and the overall high quality of the workforce in northeast Pennsylvania — those are still for real and when you start thinking ‘Wow, we’ve had two hurricanes in 13 months, maybe there’s a safer place to operate my business,’ I would argue that that’s northeast Pennsylvania.”
The NEPA business climate may be more cooperative than some realize.
A new state program, a DCED initiative, PREP (Partnerships through Regional Economic Performance) integrates areas historically served by industrial resource centers (IRCs); industrial development organizations; local development districts (LDDs); and Small Business Development Centers (SBDCs). For the last year and a half, NEPA Alliance joined to form the Northeast Pennsylvania PREP Partnership, one of 10 PREP regions in the nation. Now they are moving into year three and the partners, said Box, have all come together.
The business community needs to know that the partnership is here to serve them and is cooperating and partnering like never before, Box said.
Bill Moore, president and chief executive officer of the Wilkes-Barre Chamber, would said that things are improving. Slowly. “We are beginning to see some signs of a strengthening economy,” said Moore. “I believe that those signs point in a positive direction for 2013.
“One indicator is a slight year-to-year increase in personal income. While the gain is only 4 percent, it is nonetheless an encouraging signal that Greater Wilkes-Barre and the nation may be seeing positive movement. The average local income increased to $36,889 and also out-paced the rise in inflation.”
Another positive measure, said Moore, is that sales of new and existing homes in Luzerne County are ahead of last year’s numbers. Retail reports, he said, portend a strong end to the year, with heavy turn-outs and spending on both “Black Friday” and “Cyber-Monday.” Commercial construction also seems to be ending the year slightly ahead of 2011. Unemployment numbers, while unacceptably high seem to be headed down. More workers are entering the workforce (i.e., looking for work) and unemployment rates are down slightly for the region to about 8.7 percent, from 9.5 percent in June, Moore said.
“All of these would seem to be pointing to a positive move in the region’s economy. Economists are predicting a slow 2.2 percent to 2.7 percent growth in the economy for 2013. While not strong, it is forward progress. Most businesses, however, are holding their cards close to the vest pending the outcome of budget negotiations in Washington. Should the Congress fail to act on the so-called ‘Budget Sequestration,’ all bets are off. But on balance, I believe that we will see a slow, steady regional growth.”
Our region, said Penny Cannella, president of Penn’s Northeast, will face many challenges and opportunities in 2013.
“I think growth with continue to be modest or flat for the first and second quarter due to the uncertainty of how Congress and the White House are going to work out the fiscal cliff issues. In addition there are numerous questions to be answered on how health-care reform is going to impact business, investment and job creation. Once the details and implementation is more clearly understood we should see change in business spending and job creation. Other factors are the sluggish European economy and the slow growth in China which will continue to impact export demand. However, low mortgage rates and pent up demand should result in increased home sales and building.”
Even with significant job creation in the region this past year, said Cannella, the jobless rate in the Luzerne/Schuylkill, Lackawanna and Poconos are the highest in the commonwealth with the exception of Philadelphia. Penn’s Northeast, said Cannella, will continue to work in collaboration marketing NEPA with our partners.
Cannella said Penn’s Northeast anticipates that northeast Pennsylvania will continue to see growth in the health care, warehousing, transportation and manufacturing sectors of the economy. Penn Northeast’s workforce development institutions are continuing to align worker training programs with employer needs, she said. “In the coming year and into the future, the NEPA Regional Bioscience Initiative is going to have a positive influence on economic development for the eight-county region. Building on the existing investment in the region in the life sciences this collaborative interaction between the colleges and universities, intellectual capital and the existing business base should prove to have lasting positive impact on the broader economy.”
Many at the Scranton Chamber, said Amanda Marchegiani, communications specialist, said the eight-county economic development strategic plan will be impactful to 2013 and will help the region focus on the bioscience sector.
Also, in concert with MetroAction, the Scranton Chamber said the Luzerne County Small Business Loan Program will help small businesses with financing and starting or expanding their business. The loan program just recently transitioned from the Luzerne County Flood Recovery Loan Program.
As always, she said the chamber is hoping that 2013 holds growth of the region in economic development with the Technology Incubator Facility as well as with their small business loan programs, and hopes to continue to build connections with local businesses and work together and to help northeastern Pennsylvania prosper and grow and to welcome new businesses to the region.
Chamber staff said the economic forecast for the region will include much, among others, that big ‘H’.
“Health-care reform or ‘Obama Care, is going to force small business owners to evaluate their current benefits and look towards what will be required of them in 2014.”
Marcellus Shale advancements, the TCMC inaugural graduation in May, continuing regional partnerships and collaborations are all in the immediate future, said chamber staff, as are new dignitaries in office and how they will affect government. Also to look forward to in 2013: The first season in new PNC field with Scranton/Wilkes-Barre RailRiders and a new president at the Scranton Chamber as long-time president, Austin Burke, steps down..
While Scranton’s commuter tax is a no-go, what will go will go in 2013.