If one could paint a face on Hernando County's economic picture for the first half of 2013, it would have a growing grin. Indeed, indicators for job growth, real estate sales, property values and new construction show that the pace, while not as robust as in some other areas in Central Florida, is gaining steam.
Local experts say they remain confident that the economy is on the right path as Hernando recovers from the Great Recession, which began at the end of 2007. However, predicting the recovery's exact course remains challenging, county business development manager Mike McHugh said.
"The best way to describe it is measured," McHugh said last week. "I don't think anyone expected the economy to come back by leaps and bounds. What we're seeing is more subtle. But the momentum is growing every day."
McHugh said the county continues to make inroads in attracting new businesses, and cites plans by Sparton Electronic Devices to relocate it newly acquired Creonix company to the Sparton facility east of Brooksville, plus expansions by existing Hernando-based operations such as Accuform Signs and walmart.com, as examples of companies that find the county to be a good business investment.
"This is the kind of activity you want to see coming out of a recession," McHugh said. "If those things weren't happening, then I would be worried."
Although Hernando County still has the eighth-highest unemployment rate in the state, the number of people out of work continues to fall. January's unemployment rate of 9.7 percent fell to 8.6 percent in May. Pasco Hernando Workforce Board operations manager David Hamilton said he has seen several recent indicators that the trend will continue.
"The good news is that the numbers show that jobs are being added and there doesn't appear to be a decline in workforce," Hamilton said. "We went nearly three years without significant job creation, and having those new jobs opening seems to be having an impact."
Still, Hamilton said that the brightening job picture has its dark side. While employment levels in food service and retail have nearly returned to pre-recession levels, and growth in health care-related jobs has remained solid, the steady loss of good-paying public sector jobs has meant a decline in the county's overall wage base.
"The lack of higher-wage jobs remains a concern," Hamilton said. "Having more would help steer the economy because it gives people more spending power on things like vehicles and homes."
The county's real estate market has also shown gradual improvement. Foreclosures, which once glutted the market and drove home prices down, have decreased 25 percent for the year so far. And as the inventory of unsold homes continues to shrink, prices have steadily risen, said Hernando County Association of Realtors president Debra Myers.
Home sales in January were up 33 percent over the previous year, and that trend has continued into the summer months. In May, there were 335 closings with a median sales price of about $100,000 — about 20 percent higher than a year ago.
To some degree, the increase in the median home value is due to more expensive homes returning to the market, Myers said. Until recently, owners of pricier homes were holding back and waiting to see if the market improved before listing their properties.
"A lot of Realtors found it difficult to sell those houses because banks weren't willing to lend the money," she said "The good thing is that interest rates are still low, and that's helping to get more buyers into something they want."
Although the sale of existing homes may be on the upswing, the construction of new dwellings is not. Once the dominant economic engine in Hernando County, the building industry has stumbled along for the past several years, partly because of the flood of unsold existing homes.
Hernando Builders Association president Steve Culp said that while requests for residential building permits have shown a small uptick in the past two months, new home construction doesn't look as though it's perched to take flight anytime soon.
"We're still in a fragile state," Culp said. "If we see 200 permits pulled this year, most in the industry would consider it to be a positive sign."
Culp cites several factor working against the industry, including the lack of high-paying jobs, the county's reputation for sinkhole problems and the fact that people thinking of retiring to Florida aren't considering a move to Hernando County like they once did.
"We're having to compete more with places like the Villages, where property insurance rates are lower and there are more communities designed for seniors," Culp said.
He attributes any small improvement to the county's residential construction activity to the County Commission's decision two years ago to suspend impact fees, the onetime levies on new construction designed to pay for infrastructure.
"If I could point to one governmental decision that's helped us lately," he said, "that would be it."
Logan Neill can be reached at [email protected] or (352) 848-1435.