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Area business '09 outlook is grim but not totally dark

Jeannette Romero of New Tampa reacts to the Rays earning a first-ever spot in the playoffs. The Tampa Bay area was abuzz as the Rays won the American League title.


CHERIE DIEZ | Times

Jeannette Romero of New Tampa reacts to the Rays earning a first-ever spot in the playoffs. The Tampa Bay area was abuzz as the Rays won the American League title.

Predicting Tampa Bay's 2009 business scene in a sure-to-be-rough economy is like forecasting a bottom to our convulsive stock markets. Good luck. We're in megaflux. Still, here are 10 predictions for the year. Not all of them are downers!

1 Housing slump: The drop in Tampa Bay housing prices will start to moderate. But don't get your hopes too high. By the end of 2009, the median sales price of a single-family home in the Tampa Bay area will fall below $130,000. It's just under $150,000 now and last fall was in the upper $180s. Two years ago it was $223,000. It was $136,000 at the end of 2002. That will get us darn close to the bottom of our area market — tough for owners, great for buyers.

2 Troubled banks: At least five Florida banks will fail and be seized by regulators in 2009. At least another five that are in danger will be sold off in deals arranged by federal regulators. None based in our metro area will fail in '09.

3 Electric rates: Political pressure and the struggling economy will prompt Progress Energy Florida to reprice its electricity rates and defer the impact on customers of an immediate 24 percent hike in rates kicking in right now.

4 Lost jobs: Tampa Bay area unemployment will rise to 8.5 percent by the end of 2009, and higher in 2010, before government stimulus packages start to stabilize and reverse job losses.

5 Dealer squeeze: Multiple Tampa Bay area auto dealerships will close from weak auto sales. Others will be sold off to stronger industry players. Most vulnerable: single dealerships selling only Chrysler or GM vehicles. But even No. 1 auto retailer AutoNation, operating as AutoWay in this market, saw its corporate credit rating last week reduced by S&P to "junk" status. No one is bulletproof.

6 Clusters: The buzz of innovation and momentum sparked by the emerging cluster in Tampa and St. Petersburg of the high-tech, high-wage Draper Lab (hiring for new facilities on both sides of Tampa Bay), SRI (working with University of South Florida St. Petersburg), the opening of the M2GEN venture (between Merck and Tampa's H. Lee Moffitt Cancer Center and Research Institute) and even the return from Tucson, Ariz., of Clearwater-founded Biopsy Sciences will yield more recruiting successes of similar ventures in 2009, despite the slow economy.

7 Sports visibility: Despite the sour economy's likely impact on 2009 ticket prices for sports events, Tampa's hosting the Super Bowl in February and the '09 season bounce for the Tampa Bay Rays from winning the American League championship last year will prove a big bright spot, raising the image of our greater metro area.

8 Florida-Cuba relations: Business opportunities between the United States and Cuba will improve, making Florida a big beneficiary. The Obama administration will start to relax 50-year-old restrictions. The Sunshine State will gain in trade, development and expanded tourism.

9 Sagging alternatives: Florida's aggressive alternative energy initiatives, championed by Gov. Charlie Crist and reinforced, one would think, by the election of Barack Obama, will struggle — a lot — in 2009. As long as oil prices hover near $50 a barrel and Tampa Bay area gasoline prices remain well under $2 a gallon, economics will push to the back burner more expensive forms of energy production like ethanol.

10 Paper tigers: Hardly the best for last, but perhaps the easiest to predict: The newspaper business in the Tampa Bay area will have fewer employees by the end of this year.

Robert Trigaux can be reached at trigaux@sptimes.com.

Area business '09 outlook is grim but not totally dark 01/03/09 [Last modified: Saturday, January 3, 2009 3:30am]
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