In looking at some recent numbers around the visitor economy on the Outer Banks from the Dare County tourism team, it’s helpful for a moment to consider the “three C’s of context” before we begin to assess probabilities for the New Year.
The causes, courses, and consequences of a softening of the visitor economy are as unique as the places we call home, but let’s build on a few basic foundations for vibrancy in the region.
Regarding growth in the regional visitor economy, the number one limiting factor to economic growth isn’t real estate, zoning, infrastructure, government, or even supply and demand.
It’s our workforce!
In short, fewer people are working across the region for various complex reasons, some clear and some subtle.
That trend will likely continue through at least the rest of this year for those same mercurial reasons.
Our seasonal workforces, third-country nationals and summer students, have increasingly filled that gap. That trend will continue as businesses continue to buy their own housing for seasonal staff or face simply going out of business.
As we think about the probabilities of growth in our core industries, we acknowledge the bandwidth limitations of the workforce overall in driving business growth.
As an indicator, watch student numbers at our College of the Albemarle. More students in continuing education classes suggest a slowing economy as workers seek to level up their skills.
Scott Rawls, for example, who heads the state’s largest community college in the state’s most populous county, says simply that Wake Tech “focuses on the roles that keep Wake County running.” That’s a good vision to follow.
We may have seen peak tourism, for this economic cycle, over the past three years.
For a fun analogy, if we as a destination were a stock, we’d be a value play moving into 2023 instead of a growth pick.
Now, in a different cycle, what could be interpreted as a softness in tourism demand is perhaps better framed as a retention challenge within the visitor economy.
As a region, let’s keep our existing visitors coming back and make sure those numbers from 2018 or 2019 are still a reality over the next several years.
As an indicator, don’t focus too much on 2021 or 2022 comparisons. The most insightful numbers will compare 2023 to some combination of a more normalized 2018 and 2019.
Take a look at the public company Invitation Homes, for example – they manage more than 75,000 rental homes. Their stock is back to pre-pandemic levels.
Keep an eye on the rapid development of downtown Elizabeth City as a barometer for the region in the so-called halo counties of the Outer Banks.
With a lot of rooftops in the pipeline, the success of the downtown movement right now will be a bellwether for a range of similar experiments, and growth potential, across the region.
Whether it’s the relatively lower cost of housing, larger labor force, or access to the colleges or hospitals, if downtown succeeds, it will provide a blueprint for other areas.
Let’s keep our fingers crossed for those entrepreneurs downtown who believe in the future of Elizabeth City. They’re our regional version of the so-called Carolina Core development partnership along the interstate corridor from Winston-Salem to Fayetteville.
Of course, at the governmental level, we’ll assume that in terms of resource allocation, there remain no higher priorities than the visitor economy, healthcare, and education–that iron triangle is what keeps our bedroom communities and neighborhoods resilient.
That’s a start, at least, and on an optimistic note, I think it’s safe to say that as a region, we’ve never been more well-positioned to move into another economic cycle.
Happy New Year to all, and to all, a good year.
“Sound Strategy”, a weekly commentary from our publisher Clark Twiddy, features issues, ideas and information focused on our mission statement of “Covering the Business News of the Greater Outer Banks”.