ITHACA, NY – Job growth in the hospitality sector has propelled Tompkins economic growth to an all-time high, according to a report from the Ithaca College Department of Economics.
Each month, Ithaca College produces a report on the Ithaca Business Index, which measures economic growth against a baseline set in 1985. In July, it reached a new all time high of 172.09, which effectively means that the economy has grown 72.09 percent since 1985. The previous peak was 171.14 in September 2015.
According to the report, Tompkins County gained 200 jobs in July on top of 2,200 gained in June — bringing the total number of nonfarm jobs to 73,200 — also a new high. The amount of help wanted ads declined slightly from June numbers, but is up almost 25 percent over last year.
Unemployment in Tompkins sits at 4.0 percent, down 0.6 percent from this time last year and now a full 1.0 percent lower than the state average.
High demand for hotel rooms and the hospitality sector in general were highlighted as primary drivers of this growth. As always, education and health services also continue to be major players in the Ithaca area economy.
According to the report, changes in employment are generally much less volatile than other measures, so job growth is the most heavily weighted factor in the Ithaca Business Index.
Some decline, too
The news isn’t all good, however. Counteracting the job growth, retail sales fell almost 1.0 percent from the previous month and over 6.0 percent from last year. The report says that Ithaca’s retail strength has been lackluster since its peak in 2013.
The real estate market seems to be suffering as well. Home sales fell 19 percent from June numbers, and roughly 36 percent compared to last year. IC economists reported that the real estate market “underperformed” in 2015 and expected the same this year, falling by 9 percent, and 2016 isn’t expected to improve things much, if it all.
If there’s a silver lining here — for buyers anyway — it’s that the median price of homes fell around $17,000.
Residential building permits, meanwhile, are up 13.68 percent over last year. Even more so than real estate, building permits are highly volatile, so there may not be any strong conclusions to draw from this statistic.
Another indicator that the Index includes is air traffic, which is up a little over 4 percent over last year. Air traffic in Ithaca hit a major decline in 2014, dropping 14 percent over 2013. That area seems to have stabilized, and no major change is expected overall.
Overall, Ithaca College economists are predicting a net growth of 0.5 in the Ithaca Business Index in 2016.