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Tourism's economic importance to the Transylvania Co. & Brevard North Carolina's economy. Tourist spending, jobs & taxes generated. Includes counties in Western North Carolina. Presentation to Transylvania Co. Brevard Chamber of Commerce and Brevard College.
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Tourism’s Importance to theTourism s Importance to the Transylvania County & Brevard Economy
Steve Morse, Ph.D.
Director & Economist T i I tit tTourism Institute
University of TennesseeKnoxville, TN
Ph: (865) 974‐[email protected]
October 15, 2009Brevard, NC
Tourism’s Importance to theTourism s Importance to the Transylvania County & Brevard Economy
Brevard CollegeSteve Morse, Ph.D.
Brevard CollegeBrevard, NC
October 15, 2009Director & Economist Tourism Institute
University of TennesseeyKnoxville, TN
Ph: (865) 974 6249Ph: (865) 974‐[email protected]
Outline of Topics
1) Tourist spending trends in Transylvania Co. 2) Tourism’s importance to the Transylvania Co. economyy
3) Employment trends in Transylvania Co.4) The U S recession – city analysis4) The U.S. recession city analysis5) Three recovery models for U.S. Economy
But first, something very important to mention about the Brevard College g
Football Team ……..
How ‘Bout Them Tornadoes!
Areas of FocusFocus
Top 10 Western NC Counties for Tourist Spending in 2008Spending in 2008
1) Buncombe Co. $711.0 million2) Swain Co. $233.2 million3) Macon Co. $120.5 million4) Henderson Co. $198.6 million5) Haywood Co. $113.4 million6) Transylvania Co. $77.1 million7) Jackson Co. $69.1 million8) Cherokee Co. $35.3 million9) Graham Co. $23.4 million10)Clay Co. $12.0 million
Source: TIA & NC Division of Tourism, Film & Sport Development
Transylvania Co. Tourist Spending, 1999 ‐ 2008
$90 $ illi t i t di
$80
$90
$$75.6
$80.1 $77.1
$ million tourist spending
$60
$70
$$59.6 $60.8 $62.0 $62.9 $64.8
$69.9
$50
$60 $55.7
$40
Source: TIA & NC Division of Tourism, Film & Sport Development
Percent Change in Tourist Spending, 2006 2007 (b f th i )2006 – 2007 (before the recession)
6 5%Jackson Co
0%
6.0%
6.5%
H d C
Transylvania Co.
Jackson Co.
4.4%
5.0%Clay Co.
Haywood Co.
3.8%
4.2%Macon Co.
Swain Co.
2.1%
2.8%Graham Co.
Cherokee Co.
0% 1% 2% 3% 4% 5% 6% 7%Source: TIA & NC Division of Tourism, Film & Sport Development
How did gas prices & the recession impact tourist spending from 2007–2008? p g
(during recession)
7 1% Swain Co
6%
‐4.8%
‐7.1%
G h C
Jackson Co.
Swain Co.
‐4.5%
‐4.6%Macon Co.
Graham Co.
‐3.2%
‐3.8%Clay Co.
Transylvania Co.
‐0.8%
‐2.7%Cherokee Co.
Haywood Co.
‐8% ‐6% ‐4% ‐2% 0%Source: TIA & NC Division of Tourism, Film & Sport Development
Transylvania Co. Taxable Sales per Month 2006 2009 (J )Month, 2006 – 2009 (June)
2006 Sales ($) 2007 Sales ($) 2008 Sales ($) 2009 Sales ($)Jan 17,848,627 22,792,959 23,575,889 17,576,189 Feb 15,620,400 20,023,522 14,407,642 13,330,437 Mar 19,424,263 21,462,701 25,250,520 17,771,279 Apr 21,317,240 23,888,196 21,902,111 17,389,467 May 16,804,648 21,703,412 24,245,485 19,821,655 Jun 27,416,615 27,585,527 26,511,608 21,959,170 Jul 31,572,861 23,968,190 25,485,617 Aug 22,789,090 28,673,645 23,228,671 Sep 19,977,364 16,904,337 22,220,731 Oct 24,775,646 23,724,631 21,927,384 Nov 21,791,530 22,856,574 15,874,102 Dec 21,569,548 22,389,814 23,080,437
Total 260,907,832 275,973,508 267,710,197 Source: North Carolina Department of Revenue & Dr. Steve Morse, University of Tennessee
Transylvania Co. Taxable Sales per Month 2006 2009 (J )Month, 2006 – 2009 (June)
$35,000,000 2006 Sales
2007 Sales2006
$25,000,000
$30,000,000 2008 Sales
2009 Sales
2006
2008
$20,000,000
2007
$10,000,000
$15,000,0002009
$0
$5,000,000Note of interest: Easter holiday 2008 fell on March 23, earliest Easter date since 1913
$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec.Source: NC Dept. of Revenue & Dr. Steve Morse, University of Tennessee
Brevard City Taxable Sales per Month 2006 2009 (M )Month, 2006 – 2009 (May)
2006 Sales ($) 2007 Sales ($) 2008 Sales ($) 2009 Sales ($)Jan 9,610,271 15,478,986 15,878,725 12,815,770 Feb 9,961,570 13,988,550 9,374,594 9,556,853 Mar 11,698,280 12,327,840 17,915,415 12,968,858 Apr 12,866,293 14,308,849 15,237,249 12,418,334 May 10,111,828 13,958,708 14,900,235 13,464,408 Jun 13,766,927 15,435,354 17,798,291 Jul 20,791,541 12,944,426 16,106,983 Aug 14,925,596 16,604,424 15,061,201 Sep 10,671,812 9,731,041 15,363,941 Oct 15,256,854 13,187,508 14,873,720 Nov 13,026,426 14,320,140 11,274,934 Dec 13,672,469 14,100,531 17,778,673
Total 156,359,867 166,386,357 181,563,961 Source: North Carolina Department of Revenue & Dr. Steve Morse, University of Tennessee
Brevard City Taxable Sales per Month, 2006 – 2009 (May)2006 2009 (May)
$25,000,0002006 Sales2007 Sales
$20,000,000 2008 Sales2009 Sales
2006
2008
$15,000,000
$10,000,000 20072009
$5,000,000
Note of interest: Easter holiday 2008 fell on March 23, earliest Easter date since 1913
$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec.Source: NC Dept. of Revenue & Dr. Steve Morse, University of Tennessee
Annual Taxable Sales for Transylvania Co. & Brevard City, 2006 ‐ 2008Co. & Brevard City, 2006 2008
$260,907,832$275,973,508 $267,710,197
$300,000,000
$ , ,$260,000,000
Transylvania Co.
$181,563,961
$220,000,000
$156,359,867$166,386,357$180,000,000
Transylvania Co.Brevard City$140,000,000Transylvania Co.
Brevard City
Brevard City
$100,000,000
2006 2007 2008Source: NC Dept. of Revenue & Dr. Steve Morse, University of Tennessee
Impacts of Tourism on the T l i C E 2008Transylvania County Economy, 2008
Tourist Worker Spending:$77 1 Million
Payroll:
$14 9 Million$77.1 Million $14.9 Million
Employment: State Taxes: Local Taxes:Employment:
780 Jobs
State Taxes:
$2.99 Million
Local Taxes:
$3.71 Million
Source: NC Division of Tourism. Film & Sport Development & U.S. Travel Association
Q: If tourists to Transylvania Co. yspent $77.1 million in 2008, how
h d i dmuch do tourists spend on an average day inaverage day in
Transylvania County?
$211,23217Source: Dr. Steve Morse, University of Tennessee
Also on an Average Day in Transylvania Co., tourist spendingTransylvania Co., tourist spending
generates…
Paychecks worth $40,821 daily
State taxes worth $8 191 dailyState taxes worth $8,191 daily
T l i C t thTransylvania Co. taxes worth $10,164 daily$10,164 daily
18Source: Dr. Steve Morse, University of Tennessee
How much in NC State and Transylvania Co. taxes did Tourism Generate in 2008?
• NC State sales taxes $2.99 million
• Transylvania Co. local taxes + $3.71 million
• Total State & Local Taxes $6 7 million• Total State & Local Taxes $6.7 million
19Source: NC Division of Tourism, Film and Sport Development
If we spread out the $6.7 million in taxes generated by tourism across all
households in Transylvania County, howhouseholds in Transylvania County, how much would this be per household?
• According to the U.S. Census Bureau, hthere were 17,242 permanent resident households in Transylvania yCounty in 2007.
20Source: Dr. Steve Morse, University of Tennessee & U.S. Census Bureau
Tourism Tax Relief for Transylvania CoTransylvania Co.
• Each household in Transylvania Co. pays $388 less in State and local taxes as a result of tourism economic activityresult of tourism economic activity
$388Tax relieff hfor each
Transylvania a sy a aCo. household
Source: Dr. Steve Morse, University of Tennessee
A Big Check for $388 to Each Transylvania County HouseholdTransylvania County Household
For tourism taxFor tourism tax relief of $388 each householdeach household does not have to pay Providedto pay. Provided by taxes generate bygenerate by tourist spending in Transylvania
Amount: $388in Transylvania County.
Source: Dr. Steve Morse, University of Tennessee
For every $1 invested in tourism for Transylvania County, each $1 generates…Transylvania County, each $1 generates…
$22.70$12.57
$22.70
$10.13 in localin combined
in State taxes
in local Transylvania Co. taxes
combined State & local taxestaxes local taxes
Source: Dr. Steve Morse, University of Tennessee
What is the Return on Investment (ROI) of Transylvania County’s Tourism Budget ofTransylvania County s Tourism Budget of
$295,000?
•$12.57 in local taxes (ROI = 12 57%)
Each $1 taxes (ROI = 12.57%)
•$10.13 in State t (ROI 10 13%)
spent on tourism in taxes (ROI = 10.13%)
•$22.70 in State & Transylvania
Co local taxes (ROI = 22.7%)
Co. generates…
Source: Dr. Steve Morse, University of Tennessee
How have Transylvania Co. Employment Trends Changed Since 2002?Trends Changed Since 2002?
Industry 2002 2008Manufacturing 22.0%Education & Health Services 19.1%
Retail, Wholesale Trade, Transp & Utilities 18.8%Transp. & Utilities
Tourism & Hospitality 15.8%
Construction 9.0%Prof & Business Services 5.1%
Financial Activity 4.2%Source: U.S. Dept. of Commerce, Bureau of Labor Statistics & Dr. Steve Morse, Univ. of Tennessee
How have Transylvania Co. Employment Trends Changed Since 2002?Trends Changed Since 2002?
Industry 2002 2008Manufacturing 22.0% 4.8%Education & Health Services 19.1% 22.6%
Retail, Wholesale Trade, Transp & Utilities 18.8% 26.6%Transp. & Utilities
Tourism & Hospitality 15.8% 17.8%
Construction 9.0% 10.3%Prof & Business Services 5.1% 8.0%
Financial Activity 4.2% 4.0%Source: U.S. Dept. of Commerce, Bureau of Labor Statistics & Dr. Steve Morse, Univ. of Tennessee
How has Transylvania Co. emplo ment chan ed since 2002?employment changed since 2002?
26.6%30%2002 2008
Percent of total employment
22.0%19.1% 18.8%
15 8%
22.6%
17.8%20%
25% 2002 2008
15.8%
9.0%10.3%
8.0%10%
15%
5.1% 4.2%4.8%4.0%
0%
5%
0%
Source: U.S. Dept. of Commerce, Bureau of Labor Statistics & Dr. Steve Morse, Univ. of Tennessee
Today’s U.S. Economic Health
• Significant drop in GDP in 4th Qtr. ’08, U.S.
Economy has Slowed
g p1st Qtr. ’09, & 2nd Qtr. ‘09
• Consumer Confidence Index hit 25 0 l t i 30Consumer
Confidence
hits 25.0, lowest in 30 years
U.S. unemploy
• U.S. unemployment rate 9.5% is highest in 30 years (Oct. ‘09)unemploy
ment rate g y ( )
Source: U.S. Dept. of Commerce
Top 10 Ways Tourists Reduced Travel Spending in 2009
1) Take shorter trips (miles) 58%2) Look for discounts 38%3) Less on paid attractions 35%4) Buy less souvenirs 33%5) L i l d i 27%5) Less expensive lodging 27%6) Less nights away home 25%7) More meals in room 18%7) More meals in room 18%8) Drive different vehicle 10%9) Split costs with others 9%9) Split costs with others 9%10) More fast food 8%
Source: Jerry Henry and Associates29
When did the recession start?Percent Change in Real Gross DomesticPercent Change in Real Gross Domestic Product (GDP) from Previous Quarter
6.0
2.0
4.0
‐2.0
0.0% change
6 0
‐4.0
‐8.0
‐6.0 (2006) (2007) (2008) (2009)Source: U.S. Bureau of Economic Analysis
Recessions impact some areas harder than othersareas harder than others
Let’s identify:20 strongest Metro areas (cities hit least by recession)
y
(cities hit least by recession)20 middle strength Metro areas
20 second‐most weakest20 second most weakest Metro areas
20 weakest Metro areas20 weakest Metro areas
(cities hit hardest by recession)
Percent employment Change in p ychange from peak to
Q2 ‐ 2009
gunemployment rate March 08–June 09Q
4 Key Economic Indicators Used to Rank Economic Strength of
Percent change in h i
Metro AreasPercent change in
Gross Metro Product produced peak to
Percent change in housing prices Q1 –produced, peak to
Q2 ‐ 2009 08 to Q2 ‐ 2009
20 Strongest Economic Metro Areas, as of Q2 – 2009
Albuquerque, NMAustin TX , Q
(cities hit least by recession)Austin, TXBaton Rouge, LADallas‐FW, TXDallas FW, TXDes Moines, IAEl Paso, TXHarrisburg, PAHouston, TXLittl R k ARLittle Rock, ARMcAllen, TXNew Haven CTNew Haven, CTOkla City, OKOmaha, NE
Rochester, NYSan Antonio, TX
VA Beach, VAWashington, DC
Pittsburg, PA Tulsa, OK Wichita, KS
Source: U.S. Bureau of Labor Statistics & Brookings Institute
Allentown, PAAtlanta GAAtlanta, GABaltimore, MDBuffalo, NYBuffalo, NY Charleston, SCCharlotte, NCChattanooga, TNCol. Springs, COG ill SCGreenville, SCIndianapolis, INKansas City MOKansas City, MOKnoxville, TNNashville, TN
Springfield, MASt. Louis, MO
Provo, UTRichmond, VA
New York, NY Wooster, MASeattle, WA
Source: U.S. Bureau of Labor Statistics & Brookings Institute
Akron, OHBakersfield CABakersfield, CABirmingham, ALBoise City, IDBoise City, IDChicago‐Naper, ILCincinnati, OHCleveland, OHDayton, OHG b NCGreensboro, NCLouisville, KYMilwaukee WIMilwaukee, WIMinn‐St.Paul, MNNew Orleans, LA
San Francisco, CASan Jose, CA
Phoenix, AZPortland, OR
Orlando, FL Tucson, AZSan Diego, CA
Source: U.S. Bureau of Labor Statistics & Brookings Institute
20 Weakest Economic Metro Areas, as of Q2 – 2009Sarasota, FL
Ft Myers FL ,(cities hit hardest by recession)
Ft. Myers, FLDetroit, MIFresno, CAFresno, CA Grand Rapids, MIJacksonville, FLLakeland, FLLas Vegas, NVL A l CALos Angels, CAMiami‐Ft. Laud, FLModesto CAModesto, CAVentura, CAMelbourne, FL
Tampa, FLToledo, OH
Riverside, CASacramento, CA
Providence, RI Youngstown, OHStockton, CA
Source: U.S. Bureau of Labor Statistics & Brookings Institute
SummaryEconom to
= strongest metro areasiddl t th tEconomy to
Q2 ‐ 2009= middle strength metro areas= weakest metro areas
Source: U.S. Bureau of Labor Statistics & Brookings Institute
Outlook for 2009 & 2010( i i di ?)(Swimming or treading water?)
“Predictions are difficultdifficult, Especially when
lkiyou are talking about the future.”
Y i B‐ Yogi Berra
What will be the shape of our recovery?
V‐Shaped?1.2Economic Growth
1
1.2
N
0.6
0.8 NowOct. 2009
0.4
0
0.2
2007 2008 2009 2010 2011 2012
Source: Dr. Steve Morse, University of Tennessee
What will be the shape of our recovery?
U‐Shaped?1 2Economic Growth
1
1.2
0.6
0.8
Now
0.4
0.6Oct. 2009
0
0.2
2007 2008 2009 2010 2011 2012Source: Dr. Steve Morse, University of Tennessee
What will be the shape of our recovery?H i t l L Sh d?Horizontal L‐Shaped?
1 2Economic Growth
1
1.2
Now
0.6
0.8
Now Oct. 2009
0.4
0.6
0
0.2
2007 2008 2009 2010 2011 2012Source: Dr. Steve Morse, University of Tennessee
What is today’s consensus for recovery?
• V‐shaped recovery: 10% ( t d )–(steady)
• U‐shaped recovery: 80% p y–(getting weaker)
• Horizontal L‐shaped: 10% –(getting stronger)(getting stronger)
Source: Dr. Steve Morse, University of Tennessee
For an electronic copy of this presentation email me atpresentation, email me at ……
smorse@utk [email protected]: Oct. 15 presentationj p
Contact Information:Contact Information:
Dr. Steve Morse
Director & Economist, Tourism InstituteUniversity of Tennessee; Knoxville, TN
Ph: (865) 974‐6249E‐mail: [email protected]
Th k f i itiThank you for inviting meQuestions? Comments?Q