Howard feels pains of slow economy

Officials say tourism, commercial real estate are showing effects

October 08, 2001|By TaNoah Morgan | TaNoah Morgan,SUN STAFF

If Howard County wasn't feeling an economic pinch before, the sting is certainly here now, local economic leaders say.

The unemployment rate is on the rise, with job seekers flooding the county's employment office for resume workshops and training opportunities. Vacant commercial real estate that once was quickly snapped up is abundant. The tourism industry is trying to lure visitors into shopping areas and entertainment venues.

"We've taken a hit that's going to cost us millions of dollars," said Melissa Arnold, executive director of the county Tourism Council. "It's having a tremendous impact on our local economy."

Jobless rate up

The latest figures from the state Department of Labor, Licensing and Regulation put the county's unemployment rate for June and July at 2.5 percent - the highest in three years. That figure is a 25 percent increase from May, when the unemployment rate was 2 percent.

The increase means that 1,000 more people are out of work, said Richard W. Story, chief executive officer for the county's Economic Development Authority.

"We have seen big reductions by large employers led by Corvis [Corp.] and Tate Access Floors," he said. "As you have downsizing [in smaller companies], one here and one there, that adds up."

Corvis announced in May that it was cutting 250 positions, and Tate eliminated 149 jobs in July.

The summer added smaller job cuts to the state's list: Roche Pharmaceuticals cut 25 jobs in June, CGU Insurance cut 20. In August, Chrysler Financial announced it would take 90 jobs to Pennsylvania.

Companies with fewer than 100 employees are not required to report job cuts to the state.

More business for county

At the county Office of Employment and Training, workers are feeling the effects.

"We have quadrupled our numbers," said Cheryl A. Queen, marketing coordinator for the office. "A lot of smaller companies are experiencing layoffs.

"It's not totally the [information technology] field. It's across the board," she said.

Queen said the number of new job-seekers at her office for training has risen from an average of 22 a month last year to an average of 73 a month this year.

Counselors on average handle between 65 and 70 clients, not including the job-seekers who go to the Oakland Mills center to use computers or attend workshops on interviewing and writing resumes.

Plenty of office space

Office space in the county is ample now, Story said.

"That's the first time this has happened in the last 10 years," he said. "There are developers that are very nervous right now."

The office vacancy rate in September was 17.22 percent, according to Terry R. Dunkin, vice president of Colliers Pinkard, a commercial real estate company. That's more than double the rate a year ago, Dunkin said.

Less than half the 472,000 square feet of office space developed in the first six months of the year had been leased by June, according to a market report by Colliers Pinkard. Only a small portion of the 1 million square feet of office space under development at the time was pre-leased, the report said. Today, about 650,000 square feet of that space remains under construction, Dunkin said.

Although office leasing has been slow, the terrorist attacks in New York and at the Pentagon have prompted new interest from government agencies as they prepare for larger budgets and more personnel, Story said.

Tourism industry affected

The attacks dealt a painful blow to the county's tourism industry - particularly to attractions counting on visitors who travel to Washington. Their downturn is adding drag to the overall economy, Arnold said.

In the first two weeks after the attacks, Arnold said, the six largest tourist attractions lost $1.4 million. Those tourist-dependent companies "are scrambling," he said.

"We're trying to develop a strategy that will help the tourism industry get back on their feet," Arnold said. "It's incredible to see the amount of loss when we had such a strong tourism industry."

The Tourism Council has organized Hometown Tourist Month, a promotion that focuses on local tourism from Thursday through Nov. 11. During that time, participating vendors will donate a portion of their proceeds to the Sept. 11 relief fund.

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