Are Vail Valley businesses hiring?
VAIL VALLEY, Colorado- It’s been more than a year since the national economic slump hit home, hard, in Colorado’s Vail Valley.
Virtually every business in the valley has cut costs everywhere possible – including staff – and it shows in the numbers. According to figures provided by the Colorado Department of Labor and Employment, Eagle County’s unemployment rate was 4.8 percent in November of 2008. That number was 7.5 percent in November of 2009, the last month for which figures are available.
The county’s unemployment rate topped out at 9.7 percent in May of last year.
Unless you were one of the roughly 2,200 people in the county out of work in November, the numbers aren’t bad, compared to the country as a whole (10 percent) or states like Michigan, where some counties’ unemployment rates are pushing, or exceeding, 30 percent.
Still, the national economy seems to be starting at least a weak recovery, which leads to a couple of questions:
Has unemployment bottomed out locally?
When are companies going to start hiring again?
The news isn’t good on either front.
“We’ve still got a long way to go,” Colorado Department of Labor and Employment spokesman Bill Thoennes said. “I don’t think we’ve touched the bottom yet.”
And, from the perspective of people who look at the whole state, just trying to get a handle on how many people are out of work can be a tough job.
“If people haven’t looked for work in the four weeks prior to the measurement period, they aren’t counted that month,” said Alexandra Hall, the labor department’s chief economist.
Hall believes that the residue of this slump still hasn’t cleared yet, and unemployment will probably stay relatively high until that happens.
Michelle Evans, a co-owner of Evans Chaffee Construction Group, also believes the valley’s unemployment rate is probably going to grow in the next year.
While architects, land planners and general contractors were among the first companies affected by the slump as new projects disappeared from the pipeline, many subcontractors – from plumbers to electricians to drywallers – kept working. Once those projects are finished, that’s going to be end of work for those companies, Evans said.
“The (construction) business has changed,” Evans said. “I don’t think it will come back to what it was for some time, if ever. There’s some real carnage out there.”
In the lodging business, Rob LeVine laid off 10 percent of his employees at The Antlers Lodge in Vail. It was only four people, but 10 percent is 10 percent. Since the initial layoffs, he’s been able to bring back one person full-time and another part-time. He’d like to do more, but in the current climate, simply can’t justify it.
“I don’t have any visions of when that’s going to change, either,” LeVine said.
People interviewed for this story agree that companies aren’t going to start hiring again until businesses start growing again. But that could take some combination of local opportunity and outside forces.
Sarah Franke is the communications manager for the company that owns the Chophouse restaurants in Vail and Beaver Creek, as well as the two Blue Moose Pizza restaurants and Foxnut in Beaver Creek. She said company owner Brian Nolan is always looking for opportunities, but isn’t sure what it would take to get the company growing, and not just holding on to what it has.
“It’s hard for anybody to think about growth right now, but there’s a lot of opportunity out there,” Franke said.
In the construction business, Evans said what the valley needs are “vertical” projects, meaning residential or commercial construction of some kind. While roughly $12 million in federal stimulus money will be used to build roundabouts at the Edwards Interstate 70 interchange starting this year, there aren’t many local companies that are qualified to do that work.
“I’d hope they’d hire local workers, though,” Evans said.
Evans said there are a lot of projects on hold right now, so the construction business could ramp up fairly quickly once developers decide it’s time to build.
That, though, will require some changes in the national economic picture.
“It’s pretty clear that there needs to be both consumer and business confidence,” said Chuck Madison, a partner with Avon-based East West Partners.
Consumer confidence seems to be coming back, Madison said. But business confidence is still weak.
“There’s no lending going on right now,” Madison said. And banks need to lend money for businesses to grow.
Madison believes a few things need to happen before the lending pipelines open up again.
First, the inventory left by the residential building boom has to clear out. Then, the rubble from an expected crash in commercial real estate is going to have to be cleaned up.
“Congress isn’t going to want to hear this and taxpayers aren’t going to want to hear it, but I think we need another round of TARP money to get through it,” Madison said, referring to the federal “Troubled Asset Relief Program” that loaned money to banks that were sitting on bad mortgages.
While he wasn’t talking about employment, Madison said he believes the country is about at the bottom of the financial mess, which needs to clear up before most companies will think about hiring.
“There’s some private money starting to come back into the market,” Madison said. “But before more comes in, the banks have to start lending. And banks may say they’re lending now, but they aren’t.”
Business Editor Scott N. Miller can be reached at 970-748-2930 or firstname.lastname@example.org.
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