Rebounds are not all equal
[ By Katherine Nettles ]
Gunnison County as a whole is enjoying an economic upturn, despite of, and in some cases, due to the pandemic. But the benefits are not necessarily helping local workers, according to recent data. It appears that alongside the rising cost and diminishing inventory of housing and lack of adequate wages, issues of food insecurity and emergency mental and behavioral health visits remain high in parts of the county. These are especially present in the south end of the valley, and seem to have been exacerbated by the pandemic.
Gunnison County’s community and economic development disaster recovery coordinator Loren Ahonen has presented two reports this year, one in March and one in July, to update county commissioners on several socio-economic indicators. Gunnison County overall scores low on a social vulnerability index, but there are several areas for improvement and many persistent issues remain.
“Based on available data (sales tax, unemployment and even survey results) our economic picture is stronger than many other communities. That being said, it’s not without challenges,” said Ahonen.
Sales tax chaos
Overall countywide sales tax as of July was up 32 percent for the year and sales tax collections were at their highest for that month in the past decade. But Ahonen noted that the increase is not consistent across each business sector or community and in fact, widespread discrepancies exist. In March 2021, Mt. Crested Butte sales tax was down 11.9 percent and Pitkin was down 13.9 percent. Sales tax collections show significant rebounds in Pitkin and Mt. Crested Butte this summer, and in all other areas of the county, but the City of Gunnison central business district, which Ahonen said had seen a decline of 12.6 percent this year to date. The town of Crested Butte has had the largest increase in sales tax year over year, at 59 percent.
Specialty stores did not see the same sales tax growth as other countywide sectors. While grocery stores, lodging and building materials had a strong year in 2020, some restaurants, bars and liquor stores in general saw double-digit declines. Vehicle sales, parts and services and utilities also show a decline since the pandemic began. The largest hits to the restaurant sector were in Mt. Crested Butte and Gunnison and despite a robust summer, Ahonen predicted it will take some time for restaurants and bars to regain lost ground from 2020.
The inconsistent sales tax trends during this period are, as Ahonen puts it, “An imperfect reflection of business profits and the devil can be in the details.”
“There are also unanswered questions for me regarding the exponential rise in online sales tax collection and what impact this has on our local business community. I don’t know what proportion of those online sales are to local retailers versus big box stores (IKEA) vs. online retailers (Amazon),” Ahonen said.
The business climate is complex, and Ahonen pointed out that business creation and loss is fluid within the county at any time. Some losses in the past 18-plus months can be attributed to the pandemic, but others appear to have multiple variables and would have happened anyway, he said. And new businesses also started, while others have grown and expanded.
One thing that stood out from community surveys was that employee/employer morale is consistently reported as low.
Business climate, wages and unemployment
Ahonen noted in July that many businesses have staffing challenges that began to materialize in 2019 and have worsened ever since. In an April 2021 survey, 50 percent of business respondents reported they had unfilled jobs, and 46 percent said their ability to recruit and retain employees had declined or gotten harder. These challenges, said Ahonen, are likely due to housing issues and job growth.
The Bureau of Labor Statistics show that unemployment in the valley peaked at over 16 percent in May 2020, then fell below 4 percent last September and was around 5 percent in April of 2021.
“This must also be considered in the light of continued workforce shortages,” said Ahonen.
County wages have improved every year since 2016, but remain lower than many peer communities, and as of December 2020, average weekly wages were $896.
Housing security, food and cost of living
The rise in housing prices by 5.8 percent in Gunnison and 6 percent in Crested Butte over the past two years make home purchases less attainable for local workers, and yet applications for housing assistance (and expenditures) seem to be normalizing in 2021 after a temporary +400 percent spike in 2020. Home sales increased by 45 percent in 2020, creating less housing stock as well.
Housing and rental assistance through the county services has stabilized to pre-pandemic levels, but “anecdotal reports of community members being displaced/losing housing rose significantly in Quarter 2 of 2021,” according to the report. Ahonen noted here that “evidenciary data” of this is not easily identified, however. One is that rents have increased across all units by 15 percent in the South Valley and 17 percent in the North Valley since 2016.
“There are a fair amount of indicators here that to me show household level socio-economic challenges (particularly in the South Valley),” he said.
Food security seems to have stabilized to pre-pandemic levels, but upcoming changes may effect that, according to Ahonen. Federal food allocation programs like SNAP and locally, the Gunnison County Food Pantry have reported they are “at a high plateau.” The majority of food pantry recipients are within Gunnison city limits, followed by unincorporated Gunnison County and Somerset.
Ahonen noted that many SNAP recipients will be up for re-qualification this fall, and with revised qualifications, the county’s health and human services department expects that about half of the current recipients will not requalify for aid. “This will push numbers even closer toward 2019. Should folks continue to have food security challenges, the Food Pantry will be available and is anticipating some climb in demand when the SNAP re-qualifications happen. The Pantry also continues to do pretty brisk business,” he said.
Several other indicators included childcare costs, utility costs and household spending. Childcare assistant programs have a higher wait list than in previous years, and those who don’t meet the qualifications for assistance are also cost-constrained, said Ahonen. Home energy cost burdens vary significantly by Area median income (AMI) bracket, from 3 percent of household income at 100 AMI up to 23 percent of household income for those making less than 30 percent of AMI. While Gunnison County Electric Association reports that late bills and collections are near normal, the city of Gunnison reports that past due accounts were up 225 percent in 2020.
Consumers seemed to have mixed feelings about household spending, with 67 percent of survey respondents reporting in April that they had returned to normal spending and 17 percent reporting that they planned to do so by June.
The household level economic challenges have always existed in Gunnison County, said Ahonen. “But the exacerbation of those challenges by the pandemic made them more obvious throughout the community. So, yes, I think they still exist. But certain dimensions (i.e. utility challenges) have improved.”
Last, Ahonen discussed health and wellbeing. Survey respondents indicated coping with pandemic related stress through largely healthy mechanisms, like exercise, time outdoors and connecting with family. And most reported their alcohol consumption has not changed, with increasing consumption reported by a declining 17 percent (from 28 percent last winter). Emergency Room visits have increased for behavioral health related issues over the past two and a half years.
Combining these metrics paints a bigger picture, says Ahonen. “The still elevated need for food assistance (SNAP and the food pantry) and the precipitous rise in mental/behavioral health ER visits are concerning to me.”
His final metric to share was a social vulnerability index, which factors several data points into an overall score of 0.3 for Gunnison County. Lower is better, and Gunnison County is at the lower end of the spectrum for the state. One large discrepancy there is the calculated Self Sufficiency Standard, in which “sufficient income” is compared to the median household income for the Gunnison Valley. The median incomes fall short of that standard by more than $10,000 for both ends of the valley.
“The challenges we know to exist in our community (income/wages relative to housing costs as one example) have been exacerbated by the pandemic,” Ahonen said.
The Gunnison County economic recovery dashboard can be found at covid19.gunnisoncounty.org