The Chmura Economics Blog
OnStage May 01

New Feature: Customized URL's
The new OnStage login screenWe are pleased to announce that OnStage now offers customized site URLs. You and your users can access your OnStage site by browsing directly to a URL such as your existing organization home address! A custom URL will allow you to specify a subdomain for your site, for example http://YourCompany.onstageportal.com. You can continue to login using the older URL (http://onstageportal.com/login).

New Login Screen
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Referral Program
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Applied Economist Apr 21

Monday, April 21, 2008.
By CHRISTINE CHMURA
TIMES-DISPATCH COLUMNIST

We've now logged four months of contraction in key economic indicators. Along with continued signs that the credit crunch is affecting the overall economy, it's highly likely that the nation is in recession.

Recessions are tough on people who lose their jobs and businesses that have to deal with reduced revenue and profit. But can anything good come out of a recession?

Yes, recessions often make businesses more efficient. During times of strong growth, some businesses don't notice the fat they are taking on. Or they may not realize that new technologies have increased their efficiency to a point that reduces labor needs.

The proliferation of computers in the 1980s, for example, gradually encouraged employees in offices to create letters and reports directly in electronic form rather than dictating or writing in long hand to be transcribed. The efficiencies gained from this shift in administrative work from secretaries to higher-level office workers was largely realized during the 1990 recession. Firms were looking for ways to cut costs and found that fewer administration assistants were needed.

This recession already is bringing efficiencies to businesses associated with residential real estate, which has been hardest hit by the slowdown.

John McGurn, Realtor with Re/Max Commonwealth, said slower sales and higher gas prices "have encouraged me to organize my days better to minimize trips. When the housing market was booming, I did not worry about taking multiple trips to the same location."

He also has a service that he sets up for clients that sends them an e-mail with details, including pictures, of any new listings that fit their needs in terms of price, location and other factors. Driven, in part, by higher gas prices, this expanded use of the Internet provides more efficient use of time for McGurn and his clients.

And undoubtedly, financial institutions are becoming more efficient around mortgage lending to more accurately assess the credit risk of potential homeowners, as well as assessing the risk of complex financial instruments they put on their balance sheets.

Without heavy rain storms, a leaky basement or roof may go unnoticed for years, and the related damage can be significant to repair. So, too, recessions often highlight a business's point of weakness in need of attention. In the long run, we are better off with the correction.

The world lost a wonderful economist and a fantastic person late last month. Dan M. Bechter, Ph.D., died March 26 at age 69.

When I was a young economist at the Federal Reserve Bank of Richmond, Dan served as a mentor to me and others who continuously wanted to learn.

When presented with an opportunity, he would teach us how to apply economics by thinking out loud about how an event might work through the economy. He was also an excellent writer and was generous and patient in taking time to help us develop our writing style.

I am probably only one of many who would say that my career would not have been as successful without Dan's influence. He clearly made the world a better place through the people his life touched.

Even in his retirement, Dan continued to help me improve. As you are reading this article, I am missing his Monday morning e-mail critiquing this column. More so, I'll miss his examples of enjoying his retirement years and hearing about the many successes of his family members. 

Christine Chmura is president and chief economist at Chmura Economics & Analytics. She can be reached at (804) 649-3640 or receive e-mail at www.chmuraecon.com.

 

Applied Economist Apr 20

In his article, Government work force rises, Will Jones of the Richmond Times-Dispatch writes:

Just as the Richmond area is growing, so is its need for teachers, librarians, police officers, dispatchers and other municipal workers.

The number of full-time equivalent jobs at local governments and school systems in the 20 localities in central Virginia increased by 1.5 percent in 2008 compared with the prior year.

"Municipalities play an important role in Richmond's economy," said Christine Chmura, president and chief economist for the Richmond-based consulting firm Chmura Economics & Analytics. "The government sector tends to be more stable than the private sector."

With the economy faltering, Chmura said she expects slower growth and perhaps some losses in municipal jobs during the next year even though the region continues to add residents, which drives the need for more teachers, police officers and other workers.

In some respects, Chmura suggests thinking of the large localities, particularly Chesterfield and Henrico, as having the same impact as major private and state employers such as VCU Health System, HCA and Capital One.

Chesterfield, which leads the region with more than 311,000 residents, also has the most municipal employees, 11,067.

Yet, with a region-high of nearly 58,000 students to educate, a large share of Chesterfield's total number of employees work within the school system. The number of teachers, administrators, custodians and other school employees outpaced their counterparts in county government nearly 2-to-1.

At the same time, Chesterfield has fewer government-only workers than Henrico and Richmond.

Henrico had 1.49 percent more government-only employees in 2008 compared with the prior year.

Richmond had the largest number of full-time government jobs among the 20 localities in central Virginia -- at 5,039 workers, up 0.44 percent from the previous year.

Richmond, with its greater challenges with crime and poverty, also is the only locality with more government workers than school workers. Nearly 60 percent of Richmond's municipal employees work in its government.

By contrast, Powhatan County has the largest percentage of municipal jobs assigned to schools. About 84 percent of the county's total employees work in the school system.

That isn't likely to change anytime soon as largely rural Powhatan continues to develop and attract new residents, including many families from Chesterfield.

A testament to that growth in Powhatan is the planned Flat Rock Elementary School.

By this fall, the school will open its doors to hundreds of students, plus its own set of teachers, custodians, administrators and other workers.

 

Applied Economist Apr 20

Emilio Dooley of the Richmond Times-Dispatch writes:

Finance edged by health care as top employer
VCU Health System No. 1 for first time among private firms
 
Sunday, Apr 20, 2008

TOP 50 AREA EMPLOYERS
The Richmond Times-Dispatch's 16th annual Top 50 area employers section examines trends in full-time equivalent employment in the major industry sectors in the area.

By EMILY C. DOOLEY
TIMES-DISPATCH STAFF WRITER

When it comes to top employers, health care is taking the place of financial firms that once dominated the local scene.

Virginia Commonwealth University Health System ranked No. 1 for the first time on the Top 50 list of private area employers this year, increasing the number of full-time equivalent workers by 1.32 percent to 7,082 employees.

As in past years, three health-care organizations -- VCU Health System, HCA Inc. and Bon Secours Richmond Health System -- had places among the top 10 spots.

All three added positions to keep up with the demands of aging baby boomers.

"We're all expanding," said Dr. Sheldon Retchin, chief executive of VCU Health System and vice president for health sciences at the university. "As boomers started to age, the demand heated up."

Three financial institutions remained in the Top 10 as well, but each reduced the number of full-time employees.

Capital One Financial Corp., Wachovia Corp. and Sun Trust Banks cut their total work forces by the equivalent of nearly 1,000 full-time employees, or 6 percent.

Five years ago, the same players were involved but their roles were swapped.

In 2003, the top three financial firms combined had the equivalent of 17,414 full-time employees, while health care at the time had 15,707.

Today, health care firms in the top 10 account for 19,315 workers.

"The Richmond economy continues to be dominated by finance and health care firms with health care continuing to increase in employment," said Christine Chmura, president and chief economist for Chmura Economics & Analytics.

"The health care industry, in general, doesn't respond much to the business cycle," she said.

The Richmond area is home to 22 hospitals and has more than 5,700 hospital beds, according to a community profile from the Virginia Economic Development Partnership.

Statewide, 11 of the 20 occupations projected to grow by 2014 are in the health care field, the state agency said.

In the Richmond area, 15 of the 20 growth occupations are projected to be in health care, the partnership reports.

Home health aides and personal and home-care aides top the list. Occupational therapists and substance abuse and behavioral disorder counselors also are included.

The other five occupations on the list were in non-health care jobs relating to computer and technology industries.

Demand for dentists, hygienists, physical therapists, pharmacists and nursing home staff also is expected to increase. "It doesn't take a rocket scientist to think about what the elderly are going to need," Retchin said.

All that need could spell trouble for the industry.

"There's a potential shortage out there," said Patrick Farrell, president of the HCA Richmond Health System, which operates six area hospitals.

By 2020, the U.S. may need an additional 200,000 doctors and 800,000 nurses, according to the Council of Physician and Nurse Supply, a new organization based at University of Pennsylvania's Leonard Davis Institute of Health Care Economics. The group was formed to address staffing shortages in the industry.

A 2004 report by the State Council of Higher Education predicted that Virginia will be short 22,600 more full-time registered nurses by 2020.

"One of the greatest limitations is the work force," VCU's Retchin said.

Mindful of that, VCU Health System, HCA and Bon Secours report that they focus on retention and training, as well as education.

VCU Health System includes five schools -- for dentistry, medicine, allied health professionals, pharmacy and nursing -- and Bon Secours has a nursing school that graduates 120 nurses every year.

"Our goal is to hire 100 percent of these nurses into our organization," said Bonnie Shelor, senior vice president for human resources at Bon Secours.

Perks, such as offering on-site day care, continuing education opportunities and signing bonuses, are often part of the deal. HCA, for instance, offers a $1,500 bonus for a one-year commitment and $3,000 for two years.

Quality leadership also helps. "Leadership definitely attracted me to the job," said registered nurse Adam Schwer who moved to Virginia to work as a critical-care nurse at Bon Secours' St. Francis Medical Center after a hospital where he worked in New York began laying off nurses.

The Top 50 private area employers added the equivalent of 2,540 full-time workers, or 2.3 percent.

In all, 31 companies reported that they added employees between Jan. 1, 2007 and Jan. 1, 2008.

Northrop Grumman made it on the list for the first time, placing No. 33, thanks to a contract with the state to maintain computer and communications systems from a site in southeastern Chesterfield County.

Seventeen companies or firms -- six of them financial services -- reported a drop in the number of employees in 2008 compared with the prior year.

For instance, despite a new research center, Philip Morris USA also lost employees, starting the year with 7.7 percent fewer workers. A smaller, declining cigarette market has limited the company from replacing workers who left for other work or because of retirement, a spokesman said.

Four companies -- Northrop Grumman, Southern States, Performance Food Group and YMCA of Greater Richmond -- are new to this year's list.

Contact Emily C. Dooley at (804) 649-6016 or edooley@timesdispatch.com.

Read the original article.

Applied Economist Apr 18

Beth Mirza, senior editor of HR News Magazine quoted me in her article, Virginia Workforce Development Summit Highlights Best Practices:

Best Practices

Virginia SHRM chapters and government, education and business leaders shared their successes and lessons learned in workforce development. Christine Chmura, an economist heading Chmura Economics & Analytics, presented information gained from mining data on how each region of the state was spending money on training and comparing that to what jobs were needed and demanded.

Students, businesses and government “need information to select careers that are in demand in the regions where we want to live,” Chmura said. “The industry mix is constantly changing. Whether there is a shortage or a surplus of workers, both are bad, if there are too few or too many workers for specific jobs.”

For example, in one region of the state, she found that 115 students were training to become licensed practical nurses (LPNs), but there was demand for only 13 LPNs. What the area really needed were registered nurses (RNs). That region could consider creating a “bridge” between LPN and RN training, Chmura said.

“The question is, how do we solve the information gap? Because it is driving the skills gap,” she said. 

The Editor's Blog Apr 07

The first quarter 2008 edition of the Ohio Economic Trends has been released. Both print and electronic versions of this publication can be purchased through this website. This publication details the economies of Ohio and its six largest metropolitan areas; it also includes a national economic profile and feature story.

The feature story in this issue, "Commercial: Another Slumping Market,"—sponsored by Colliers Ostendorf-Morris—details trends affecting Ohio's commercial real estate market. Office employment—a driver of demand for office space—declined an annualized average 0.2% in Ohio from 2002 through the first half of 2007. Another trend in commercial real estate is the migration of office and industrial employment out of metropolitan area geographic centers. In the Ohio portion of the Cincinnati metropolitan area, for example, office employment in the region's central county of Hamilton dropped from a 74% share of regional office employment in 2001 to 68% in 2006 while Hamilton’s share of industrial employment fell from 66% to 61%.

Over the twelve months ending December 2007, employment growth in Ohio's six largest metro areas varied from +0.7% in Akron to -0.3% in Dayton. State employment dropped 0.3% over the same period, driven by a loss of over 13,000 jobs in manufacturing. A recent article from The Economist—highlighting the Cleveland Clinic—quipped that Cleveland has "an industrial hangover," and the same can be said of the state. Ohio shed over a quarter of a million manufacturing jobs from December 1999 through December 2007.

 

Applied Economist Apr 05

New study shows region got $1.84 billion from visits in 2006
In a story on tourism in Richmond, Emily Dooley of the Richmond Times-Dispatch writes:

Visitors to the Richmond region doled out about $1.84 billion in 2006 and spent enough time in bars, restaurants, theaters and shopping malls to support 25,990 jobs, a new study shows.

Those same travelers paid $454 million in federal, state and local taxes, saving households in the Richmond area $585 in taxes in 2006, the latest year figures are available, according to a study released this week by the Richmond Metropolitan Convention & Visitors Bureau.

Tourism activity in the city of Richmond and the counties of Chesterfield, Hanover, Henrico and New Kent were included in the survey. Betting proceeds from Colonial Downs in New Kent were not.

The convention bureau commissioned the $20,000 study to determine the economic impact tourism had on the area. It also wanted to know where tourism money was being spent and what it meant for local taxes.

But Christine Chmura, president of Chmura Economics & Analytics in Richmond, said the economic impact of tourism is difficult to figure "because people often have more than one reason to visit an area, and also, there are few establishments that you can identify as tourism-only," she said.

The amount of money spent on food and beverages -- $494.6 million -- topped the survey list.

Read the full story.

Applied Economist Apr 05

Emily Dooley of the Richmond Times-Dispatch writes:

The work week increased in the manufacturing sector, where production workers averaged 4 hours of overtime each week. That is 2.9 hours more than during the same period last year and the longest work week since the state began gathering work-week numbers in the early 1950s, Mezger said.

The extra hours may indicate that production companies are getting more orders for work and using existing employees to fill that demand. "Usually the long work week is a sign of the economy improving," Mezger said.

Fears of a slowing economy may also be a contributor.

"The fact that hours are up is good news, but there may be an underlying current that is negative," said Christine Chmura, president and chief economist with Chmura Economics & Analytics. "It could be that manufacturers are holding back from hiring new workers because they are concerned about future growth in the economy."

Read the full story.

Applied Economist Apr 01

Fairfax Office Closing as Jobless Claims Rise; Work Goes to Alexandria, Woodbridge
Alejandro Lazo, staff writer for the Washington Post writes:

The Virginia agency charged with processing unemployment claims is retrenching just as workers are beginning to feel the pinch of the economic slowdown.

The Virginia Employment Commission said yesterday that it plans to close its Fairfax office and relocate 45 positions in offices around the state to save an estimated $1 million on building and operating costs.

The announcement comes after the commission last month eliminated 243 staff positions, which included laying off 157 workers.

The cuts and relocations come at a time when economists say Virginia's unemployment rate is likely to increase as the U.S. economy weathers a downturn that is spreading beyond the housing market.

"Like the rest of the nation, the Virginia unemployment rate will inch up and employment growth will slow significantly from 2007," said Christine Chmura, chief economist for Chmura Economics & Analytics in Richmond. "With the overall U.S. economy slowing, the cuts in the Virginia state government are not coming at a good time."

Read the rest of the article: Va. Employment Commission Cuts Back

Ask Xiaobing Mar 31

In today’s metro business section, Richmond Times-Dispatch takes a closer look at the legal industry in the Richmond metro region and how Richmond has evolved into a “city of law and order”.

Chmura Economics and Analytics helped Times-Dispatch reporter prepare the story. Chris Chmura provided a series of data regarding the size and wages of the legal industry in the metro area. The paper quoted her in the article, City of Law and Order:

The average salary of people in the legal profession in Richmond was $77,000, compared with an overall average salary here of $44,270 in the third quarter of 2007, according to Chmura Economics & Analytics.

"When people are being paid more, they spend their money," said Christine Chmura, president of the Richmond research firm. "It has a ripple effect."

In a separate story, Legal jobs help drive economy in Richmond, Xiaobing Shuai analyzed how legal industry help create jobs in other industry sectors.

At the end of last year, 5,838 people in the Richmond area were employed in the legal industry. An additional 1,685 workers here support the legal jobs, said Shuai, who analyzed wages, benefits and productivity to compute the numbers.

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