Tuesday, November 13, 2018
Business

Bowen: Stagnant income growth tarnishes upbeat economic forecast

The 210 business and government leaders listened intently last week to a litany of statistics about the Tampa Bay area economy. All they really needed to do was look across the street.

On the north side of State Road 54 in Land O’Lakes, across from the Northpointe Village complex where the Pasco Economic Development Council held its Feb. 2 economic forecast luncheon, sits Bexley by Newland Communities, a 1,200-acre development east of the Suncoast Parkway. There, Florida Hospital recently opened a 24-bed standalone emergency room.

To the east, construction crews are building the luxury apartments known as Lakeside Walk and, to the north, the exterior walls are going up on a 110-room Spring Hills Suites by Marriott.

Health care. Residential construction. Hospitality. All are significant aspects of the Tampa Bay region’s economy that includes Pasco County.

Plus, Dell Webb plans to build a community for people 55 and older within Bexley.

Consider that indicative of the silver tsunami. People 60 and older will account for nearly 58 percent of Florida’s population gains over the next three years, said Kyle Baltuch economist and director of development for Florida TaxWatch.

Those aren’t people projected to be part of the work force. More likely, they will be the new residents seeking housing, health care, government services and other components of a service-based economy.

The dilemma is that Florida businesses are invested heavily in providing accommodations and food services — the fast-growing, but lowest-paying part of the job sector, said Baltuch.

It helps explain the most sobering statistic Baltuch shared with the luncheon crowd: Per-capita income grew just 1.3 percent in Florida last year, barely above the rate of inflation. Meanwhile, overall personal income in the state increased 3.1 percent.

Why the difference? The smaller per-capita number means people already living in Florida aren’t seeing the wage benefits from newly created jobs, said Baltuch. Those spots are being filled by new residents.

"You’d love to fill those jobs with people already here,’’ Baltuch said

Indeed. The Tampa Bay region’s per-capita income growth was even more dismal at just 1 percent, less than half the 2.1 percent rate in Orlando.

It points to a needed investment in education to train the workforce. By 2021, 64 percent of Florida jobs will require post-secondary education, Baltuch predicted, while only 46 percent of Florida’s current residents have schooling beyond high school.

In one regard, the Pasco School District should feel pretty good about its new model, turning Ridgewood High School into the Wendell Krinn Technical High School. Florida needs plumbers, electricians, building contractors and skilled workers, Baltuch said.

"I wrote that down,’’ School Board member Allen Atlman said afterward, noting he couldn’t find a parking space Thursday evening because of the crowd at parent night for the new technical high school.

Certainly, others have just as many accomplishments about which to feel good. Mettler Toledo’s new $30 million, 250,000-square-foot plant, just south of the luncheon site, is scheduled for a grand opening in late March. That is a 500-person workforce coming to build food safety equipment.

Sometime this month, another company, known now simply by its economic development code name of project apple 2.0, is scheduled to confirm its $13.25 million investment in a 116,000-square-foot research and development complex in Trinity. Bill Cronin, president and CEO of the Pasco Economic Development Council, said the company had considered Texas and the Midwest before settling on Trinity.

Unemployment is low, Florida’s job growth out-paced the nation and housing starts continue to rise, all of which point to a healthy 2018. In the long run, however, Florida’s economic development must contend with an insufficient infrastructure for stormwater drainage, school facilities and transportation.

That is no surprise to anyone in Pasco County, which combatted flooding in west Pasco in both 2015 and 2016.

Ditto for roads. For the second consecutive year, Pasco is seeking $15 million from the state for a new interchange at Interstate 75 and Old Pasco Road as a key element of developing the high-tech, connected-city corridor and an east-west transportation network between I-75 and U.S. 301.

The audience members were too polite to point out to Baltuch that Gov. Rick Scott vetoed the legislative appropriation last year after a Tallahassee watchdog group labeled the money a "budget turkey’’ for failing to be vetted properly.

The group was Florida TaxWatch.

Reach C.T. Bowen at [email protected] or (813) 435-7306. Follow @CTBowen2

PAST COVERAGE: Pasco message: Don’t curtail incentives.

PAST COVERAGE: Mettler Toledo plans $30 million plant.

PAST COVERAGE: Conflicting times for economic recruiting.

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