Department of Economics
  at Ithaca College

Looking back, 2012 was mildly disappointing for the regional economy. Economic growth was expected to come in at 1.0 percent and ended up closer to 0.5 percent. Total employment fell to 63,900 from 64,400. Retail sales were up 4.6 percent and home sales were up 3.8 percent. Air traffic and help wanted advertising held steady. Building permits closed out 2012 on a very strong note.

Looking forward, economic growth in Tompkins County is expected to be 1.0 percent in 2013. This forecast is based on the national economy expanding by 2.5 percent over the same time frame. Despite the unique nature of our regional economy, we are not immune to national and global economic trends. Nor do we want to be. We want to contribute to, and benefit from, the macroeconomy.

We had been expecting Tompkins County to create 400 jobs in 2011 and (before data revisions) the County lost 500 jobs. In our defense, no one anticipated that educational and health services, our bread and butter industry, would shed 500 jobs in 2012 after losing 800 jobs in 2011. Indeed, some are questioning the numbers.

We see Tompkins County adding 400 jobs in 2013 bringing total employment to 64,300. We think education and health services will steady itself and modest growth will occur in the other sectors.

Retail sales are expected to grow modestly as well –  5.0 percent in 2013 after putting on 4.6 percent in 2011. Employment in the retail sector has remained level at 5,100 for several years now. It’s hard to see big gains coming from retail trade.

The real estate sector has very little downside potential after being dormant since 2007. It is not clear that 2013 will be an inflection point for this underperforming sector, but building permits are picking up. We think County realtors will sell 900 homes in 2013 compared to 896 in 2012.

Strong gains in air traffic helped buoy our economy during the financial crisis. Since 2010 enplanements have held steady. If the national economy revives, so will this sector of our local economy.  However, the outlook for the national economy in 2012 is not robust.

Our other indicators, help wanted advertising and building permits, are extremely volatile. As mentioned, building permits showed inordinate strength in the last two months of 2012. Help wanted advertising, on the other hand, suggests that employers are far from desperate for more employees.

Putting all of these factors into the analysis results in an expected growth rate of 1.0 percent in 2013 for the Tompkins County economy. Since our index is adjusted for inflation, this implies that our standard of living is expected to improve by 1.0 percent. These small increments add up. In 1985, our index stood at 100; in 2012 it stands at 158. This implies that our standard of living has increased 58 percent over those years.

Current Forecasts and Forecasting Record

Economic Activity in Tompkins County (annual growth rate)

                    Forecast     Actual

     1994 >      4.0%        2.4%

     1995 >      1.5%        0.9%

     1996 >      0.0%        1.3%

     1997 >      2.0%        1.0%

     1998 >      1.5%        2.5%

     1999 >      3.0%        6.0%

     2000 >      3.0%        1.9%

     2001 >      2.0%        1.3%

     2002 >      1.0%        0.5%

     2003  >      1.0%        0.8%

     2004 >       2.5%        2.4%

     2005 >       2.0%        1.3%

    2006 >        2.0%        0.7%

    2007 >        0.0%        1.1%

    2008 >        1.0%       -0.1%

    2009 >       -1.0%      -0.7%

    2010 >        2.0%        3.0%

    2011 >        2.0%        0.2%

    2012 >        1.0%        0.5%

    2013 >        1.0%

Holiday Retail Sales in Tompkins County (in millions of $)

                    Forecast     Actual

     1994 >     $155         $156

     1995 >     $160         $159

     1996 >     $164         $159

     1997 >     $155         $165

     1998 >     $178         $168

     1999 >     $185         $186

     2000 >     $189         $186

     2001 >     $202         $195  

     2002 >     $220         $209

     2003 >      $225         $216

     2004 >      $250         $242

     2005 >      $273         $256

     2006 >     $279          $259

     2007 >     $275          $268

     2008 >     $284          $239

     2009 >     $237          $257

     2010 >     $269          $279

     2011 >     $294          $303

     2012 >     $320          $295

 

Home Sales in Tompkins County (number of units)

                   Forecast     Actual

     1994 >      670          610

     1995 >      670          658

     1996 >      620          741

     1997 >      690          785

     1998 >      750          884

     1999 >      850          967

     2000 >      980          936

      2001 >      900       1,019

      2002 >      960         948

      2003 >      925         939

      2004 >      930         997

      2005 >    1,000      1,040

      2006 >    1,000      1,041

      2007 >    1,000      1,007

      2008 >    1,000         877

      2009 >    1,000         798

      2010 >      900          855

      2011 >      890          858

      2012 >      875          896

      2013 >     900

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  The Index of Economic Activity in Tompkins County is a public service of Ithaca College.

Maintained by Elia Kacapyr (kacapyr@ithaca.edu)
Last updated 01/31/2013