By David Mclain
The economy of the greater Waco area experienced a brief surge this July during a year noting a general decrease economic activity.
Local business owners gathered together at the First National Bank of Central Texas on Wednesday, Aug. 24 to discuss the fluctuating economic condition of the city of Waco.
The July Greater Waco Economic Index is an economic analysis of Waco and the surrounding area measured by Amarillo-based economist Karr Ingham.
The overall index for July 2011 was measured at 102.4, a 1.5 percent decrease from last year’s July index of 104.0. The decrease indicates a drop in economic activity.
The economy is given a number, or score, using a formula that includes a variety of influential factors. This score is compared to the score of an earlier date, known as the base year. The base year is used as a reference point so as to compare the current economic rating and determine whether the economy is improving or decreasing.
In 2000, the base measurement was 100.6, and the index for each subsequent year is a comparison to that base year.
“It gives a constant measure to see how the economy is doing,” Sarah Roberts of the Greater Waco Chamber of Commerce said of the Index.
The Index focuses on patterns of changes in three areas, namely: spending, jobs and construction.
The early 2000s recorded numbers decreasing until a substantial rise between 2003 and mid-2007. Then the city faced two years of steady decline, and in 2009 the Index fallen additional 6 percent below the base year.
However, the index did see some improvement from June to July this year. That improvement is largely attributed to Waco’s housing and construction sectors. Existing home sales and average home sale prices have both improved over 4 percent from last month, which have helped the overall numbers move in the right direction, Roberts said.
“The number of new housing construction permits issued in Waco in July was almost three times higher than the year-ago total,” Ingham said. “July represents at least a temporary surge in activity in what has been a generally down year in housing construction.”
“We are in the least negative our negative has been,” Roberts said of the housing sector. While not content with where existing home sales and average home sale prices sit, Roberts said he was pleased with the direction each was headed.
An increase of large company interests in visiting sites for possible locations in Waco assured the business leaders of a positive economic forecast. The site visit activity this July was recorded as 85 percent higher than the rate for all of 2010.
This kind of activity is a good indication of whether new companies are going to come into Waco, Roberts said.
A good number of these companies would bring Information Technology (IT) oriented jobs, a sector of the Waco Economic Index that is improving and has room to continue to improve. Roberts expects the IT sector increase to attract graduates of Baylor, MCC, and TSTC who would normally leave Waco upon graduation looking for IT-specific jobs.
Local businesses are also becoming more comfortable with spending on advertising. According to Donnis Baggett, publisher of the Waco Tribune-Herald says they are finding even with less advertising activity from national and regional companies, the local businesses are stepping into those roles.