ECONOMY // Local market bouncing back

Published Aug. 22, 2003|Updated June 20, 2006

Santa Claus was nowhere to be seen at University Mall in July. But a record crush of back-to-school shoppers at the 1.2-million-square-foot center late last month made it feel a little like Christmas.

"This market is expanding quickly," general manager Tom Locke said, "and it's very good for retailers."

A growing number of statistical signposts, including the Index of Leading Economic Indicators released Thursday, suggest the U.S. economy may be finally, slowly emerging from its doldrums. Some Tampa Bay area businesses say the local economy is ahead of the curve.

Hawkins Construction Inc. has about 65 superintendents at work sites currently, including five overseeing the $12.5-million rebuilding of Clearwater Mall. Last year at this time the Tarpon Springs company had about 50 superintendents on duty.

At Republic Bank of St. Petersburg, loan volume is reportedly well above last year's pace. Mortgages and business loans alike are up.

Kforce Inc., a Tampa staffing company, is not placing many nurses at hospitals. Yet demand for its information technology workers and pharmaceutical research staff is growing, chief financial officer Bill Sanders said. One example: Kforce recently finished installing new checkout-line software for a major home improvement company at hundreds of locations nationwide.

"The worst-performing (Kforce) products are down slightly, and the best-performing products have improved moderately," Sanders said.

From home sales to job growth and unemployment rates, the bay area appears to be outperforming the nation. What's driving the local economy, executives here say, are largely the same factors that insulated it from the worst effects of the U.S. recession.

Tim Emslie, co-owner and chief financial officer of Hawkins Construction, said the constant flow of new arrivals to the bay area creates added demand for retail stores and other services. That, in turn, creates demand for new construction. Hawkins' clients include Eckerd Drug and Walgreens, both of which are continually adding stores.

Low mortgage interest rates, which only recently began to climb again, have helped keep the area housing market hot despite downward pressure on wages. "That's been the bright spot for the entire Florida economy," said Republic Bank CFO William Falzone.

Manufacturing has been the hardest-hit sector during the downturn, partly due to global competition. The relative scarcity of such jobs in the bay area has provided a cushion, though the sector's relatively high blue-collar wages would probably be welcome.

Determining whether a company's good fortunes are a sign of economic recovery is tricky.

Republic Bank's Falzone said the lender's recent increase in loan volume partly reflects the addition of new loan products and more staff.

Kforce's difficulty placing nurses stems from several factors, CFO Sanders said. Some potential patients are skipping elective surgery because of economic hardship. There's also the pressure from insurers unwilling to pay for long hospital stays and the effects of a warm winter that produced relatively few cases of flu, pneumonia and other weather-related illnesses.

On the other hand, Kforce's pharmaceutical clients, which include giants Amgen, Pfizer and Merck, invest in research and development throughout the economic cycle. The trial and approval process for a new drug can extend many years.

In the retail sector, population growth continues to drive demand locally. But even in good times, every mall has its winners and losers. The key, said Locke of University Mall, is being in touch with what's hot.

"A year ago, The Gap was having problems, and they're running increases now," Locke said. "That's the natural evolution of things in the retail business."

_ Scott Barancik can be reached at or (727) 893-8751.