Sunday, December 10, 2017
Business

Florida's economy takes on new look after the Great Recession

Florida's workforce — the post-recession version — has a new face.

We're making fewer machine parts, while serving more burgers and Cuban sandwiches to hungry tourists. We're building fewer homes and, instead, building more home health care relationships catering to the ill and elderly.

Four years after the Great Recession technically ended, statewide employment has finally topped 8.75 million, nearing its prerecession size. But the mix of jobs has changed dramatically, with manufacturing and construction remaining ghosts of their former selves.

The upshot: Collectively, we're earning less money with more people clustered in lower-paying jobs in retail, tourism and health care. There are more part-timers and workers combining a couple of part-time jobs into one full-time paycheck.

Economists debate how much of this transformation is systemic (with certain industry jobs in manufacturing and publishing likely gone forever) and how much is cyclical (with jobs in construction in particular picking up again as more Northerners can afford Florida housing).

Jeff Korzenik, chief investment strategist for Fifth Third Bank, believes many of Florida's hardest-hit industries will eventually rebound, even manufacturing to a lesser degree, as companies move some jobs back to the United States.

It's just a matter of time. Perhaps a lot of time. "We're still early in recovery," he said.

Taking a snapshot today, though, shows stark changes industry by industry:

• Leisure and hospitality has been on an unparalleled tear. Since bottoming out in December 2009, the sector has welcomed 110,000 more jobs — a 12 percent jump — as tourism boosters tout record numbers of visitors to beaches and theme parks.

• Leisure/hospitality and education/health services — which includes an apparently insatiable demand for nurses and home health care aides — are the only sectors that have more jobs statewide now than before the economic downturn.

• Construction was cut in half by the recession, while manufacturing lost a fourth of its workforce. Neither has budged much off the bottom, still down a combined 382,300 jobs since 2007.

• The tech-heavy information sector (which includes publishing) has likewise never recovered from the recession, let alone hit employment levels of the dot-com boom of the late 1990s.

• Professional and business services, a lifeblood of Tampa Bay's economy in particular, has only recovered about halfway from its recessionary low.

• Trade, transportation and utilities is still the biggest sector with nearly 1.6 million workers, but it encompasses a wide variety of jobs, including most lower-paying retail workers.

University of Central Florida economist Sean Snaith acknowledged that the change in Florida's workforce has been dramatic, but he's not convinced it's permanent. Already, there are signs of slower growth in tourism and a pickup in construction as this "mega-cycle" of gradual recovery continues, he said.

"It may feel trendlike (but) this was a cycle on steroids," he said. "This was probably the recession of a lifetime, and the impacts were particularly profound in Florida."

For 38-year-old April Cino, the state's economic makeover triggered a personal financial makeover. Cino enjoyed manufacturing, working in Largo for the wound-care division of medical device company Smith & Nephew. But when her British employer shuttered the Largo plant in 2010, Cino was suddenly out of a job.

The mother of two teenage children, who was also pregnant, spent a year of fruitless job hunting. She eventually lost her Hernando County home to foreclosure. With the encouragement of a WorkNet Pinellas counselor and financial help from the federal Trade Adjustment Assistance program, Cino attended Galen School of Nursing.

After receiving her registered nursing license last fall, she landed a job in the cardiac unit of Largo Medical Center. Her new job has "a lot more stress" than her six years spent at Smith & Nephew, Cino said.

"It's a little overwhelming, but I have good support with my supervisor and the nursing staff there," she said. "They're very understanding."

The Conference Board's monthly report of online "Help Wanted" ads gives an indication of where the new jobs are. Beginning in early 2012, job openings started once again surpassing job demand in Florida, according to the board, a nonprofit business and research group.

The bulk of available jobs, however, continues to flow from the same industries. The top five advertised occupations in Florida in June: registered nurses (12,815 ads); retail sales (8,514); retail supervisors (6,389); customer service reps (6,078); and first-line supervisors of food preparation workers (5,951).

To a degree, Florida's experience is a mirror image of the rest of the country. Manufacturing is slumping while retail and tourism remains strong.

"On a national level, a quarter of the job gains in April, May and June were in restaurants," said Scott Brown, chief economist with Raymond James Financial. "There's also a longer-term trend where people don't know how to cook anymore and they're going out to dinner. You're seeing more sit-down and fast-food restaurant sales."

Construction will come back, though not to the 2006 boom-time level, Brown predicted. But he doesn't anticipate a dramatic uptick in manufacturing soon, not with a soft global economy ranging from China's diminished demand to European austerity.

Workers in manufacturing face another challenge: Many factory owners are pushing for increased productivity through part-timers to avoid paying health care insurance for full-time workers under the new federal health care law.

Still, Mekael Teshome, PNC Bank's Florida economist, said he doubts that there has been a long-term shift in the state's economy.

"I see this as more cyclical," Teshome said. "It's true we're creating more lower paying jobs, but I don't think that will be the permanent future of the economic landscape."

As the housing market up North recovers, more people are expected to move to Florida, boosting construction. An overall aging population, meanwhile, could stimulate demand in everything from health care to banks to legal and other professional services. "As we age, we should see all those industries get a lift," he said.

Teshome, like Brown, is less optimistic about a manufacturing comeback. The name of the game continues to be more automation and outsourcing for the cheapest labor.

For those charged with getting Floridians back to work, the shift in available jobs has forced some hard choices.

As head of both WorkNet Pinellas and the Tampa Bay Workforce Alliance, Ed Peachey is concerned about which job training programs to emphasize and which to cut as demand has slacked. Over the past few years, both of the state-run workforce boards have emphasized health care training because of demand.

But Peachey persists in training workers in manufacturing and the building trades as well. Even if that means, as it did recently, that his organization was training welders for jobs based outside of Florida.

Over the long haul, Peachey said, a strategy of diversified training is the best bet to position Florida for its future.

"Construction is obviously nowhere near where it was eight years ago, but you still have to continue to train people in those fields," he said.

"Someday it's going to come back. And if it does come back, are we going to be able to fill those jobs? That's why we have to keep some of that going now."

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