CHAPTER 4
ECONOMIC CONDITIONS
1.
Introduction
Economic growth in a community typically occurs as a
result of external forces, such as expansion of the regional, state or national
economy, that are usually beyond the control of the community. By contrast, economic development (the
creation of new jobs, the attraction of private investment and the expansion of
existing businesses) is something that a community can directly influence. In order to encourage and direct economic
development, community officials and residents must have a clear understanding
of state, regional and local economic trends and conditions.
The first part of this chapter focuses on historical
employment and business trends during the 1990s in Conway and compares them to
both Carroll County and New Hampshire.
The next section provides an analysis of employment and business
patterns within Conway. In addition to providing
information on trends and changes in total employment and business establishments,
within major industrial sectors, a summary of Conway’s commercial and
industrial land uses and commuting patterns (employment) is presented.
In order to obtain data and information for this
chapter, three principle methods were used.
The first consisted of labor and employment data provided by the New
Hampshire Department of Employment Security and the U.S. Census. The second involved an analysis of property
assessment records provided by the Town of Conway. The municipal assessment records were used to generate a summary
of commercial and industrial land and buildings throughout the town. The third involved the use of existing
literature that provided insights into the economy of the state, as well as the
Mount Washington Valley.
2.
Summary of
Findings and Conclusions
The following points summarize key economic findings
and conclusions identified within this chapter. Additionally, various implications associated with Conway’s
economic trends are briefly discussed.
In terms of the state and regional economy, New
Hampshire and the Mount Washington Valley/Carroll County region have
experienced strong economic activity throughout the 1990s, with most of the
economic growth occurring during the later half of the decade. Indicators of economy change include:
§
According to the U.S.
Department of Commerce, between 1990 and 2000, the United States’ Gross
Domestic Product increased by 41.7%.
The New Hampshire economy outperformed both the New England and United
States’ economy with an increase in Gross State Product of over 70% during the
same time period.
§
A recent report
prepared for the Mount Washington Valley Chamber of Commerce indicated that the
Mount Washington Valley/Carroll County region has the highest percentage of
entrepreneurs (and fastest growing) of any county in New Hampshire.
§
Between 1991 and 2000,
eight out of every ten employment positions created throughout New Hampshire
were either service or trade related.
As the state and regional economy has experienced
solid growth throughout the 1990s, so to has the local economy in Conway. As a tourist and retail destination,
Conway’s employment and business establishment base is concentrated within the
service and trade sectors. Other
economic findings include:
§
Between 1990 and 2000,
Conway’s unemployment rate has declined by 3.6% - a decline that outperformed
both the state (2.9%) and the county (2.2%) over the same time period.
§
Total employment in
Conway has increased from 4,421 jobs in 1990 to 5,072 jobs in 2000, representing
an increase of over 650 jobs (15%).
§
Collectively, about 92%
of the jobs in Conway are either services or trade related – approximately 13%
more than the county average and 28% higher than the state average.
§
Between 1991 and 2000,
Conway experienced business establishment growth in all industrial
sectors.
§
With the exception of
the Conway School District all of Conway’s largest employers are within the
service or trade sectors.
§
Approximately half of
Conway’s jobs in 1990 were filled by workers who commute in from outlying
communities. Although the majority of
the workers commuting to work in Conway live within Carroll County, about 35%
of the workforce commutes in from outside of the region, with most coming from
Fryeburg, Brownfield and other Maine communities.
Based on the economic findings and conclusions
presented throughout this chapter, implications about how Conway may change in
the future include:
§
The growth and reliance
of Conway’s economy on the service and trade sector creates a situation where
it may be beneficial for the town to investigate economic development
incentives which encourage business diversification of the local employment and
business establishment base. Without
economic diversification across a range of sectors, the town may be susceptible
to larger than average job losses and business closings during economic
downturns.
3.
Key Employment
and Business Trends
Throughout the mid to late 1990s, New Hampshire has
experienced unprecedented economic growth which has been evident across a wide
range of economic indices including employment, per capita income, population
and unemployment. New Hampshire has
benefited from a diversified business establishment base that outperformed both
the New England region and the country across many major economic
indicators. For example, growth in
gross state or domestic product is widely considered to be one of the leading
benchmarks in which to evaluate an economy.
According to the U.S. Department of Commerce, between 1990 and 2000 New
Hampshire’s gross state product increased by almost 71%. New Hampshire’s growth in gross state
product outperformed both New England and the nation by over 30% and 29%
respectively over the same time period.
Most of New Hampshire’s economic activity is focused
within the southern portions of the state which is primarily the result of the
close proximity of this portion of the state to the large metropolitan market
of the greater Boston region. However,
the state’s more northerly regions, including the Mount Washington Valley for
example, have contributed to the state’s vibrant economy. According to a recently released report by
the Mount Washington Valley Chamber of Commerce entitled A View of the Mt.
Washington Valley’s Regional Contribution to the Growing New Hampshire Economy[1],
the region makes an important economic contribution to the state. These economic contributions include:
§
More net in-migration
from other states and regions than any other county except Rockingham and
Merrimack;
§
The highest percentage
of entrepreneurs (and growing faster) of any county in New Hampshire;
§
Employment and business
establishment growth above the New Hampshire average;
§
Educational test scores
and college enrollment rates that are higher than all but two counties; and
§
A private sector
employment and establishment base that results in the creation or support of
another 16,690 full and part-time jobs outside the region and $489 million in
labor income in other areas of New Hampshire.
As any local economy is dependent upon the greater
regional, state and, to a certain degree, the national economy, the following
section examines unemployment, employment and business establishment trends
relative to the state and Carroll County throughout the 1990s. That being said, it is intended that framing
the Conway economy within the context of the regional and state economy would
be most beneficial for comparative purposes.
A.
Unemployment Trends
As New Hampshire moved from the economic recession of
the early 1990s and into a strong period of economic expansion throughout the
later part of the decade, the state’s unemployment rate declined rapidly. Since 1993, New Hampshire’s unemployment
rate has dropped by 3.8 percentage points from 5.5% to its current (2000)
average of 2.8%. The state outperformed
the nation in declining unemployment by 2.9 percentage points with the 2000
national unemployment rate at 4%. In
terms of local unemployment trends, as of 2000, Conway had an unemployment rate
of 3.1% which is slightly higher than the rates for both Carroll County (2.8%)
and the state (2.8%). As presented in
Figure 4-1, throughout the 1990s Conway’s unemployment rate modeled the same
declining trend as both Carroll County and the state. Between 1990 and 2000, Conway experienced unemployment rates
which are on average between one half and one full percentage point higher than
both the state and the county. However,
between 1990 and 2000, Conway’s unemployment rate has declined by 3.6% - a
decline that outperformed both the state (2.9%) and the county (2.2%) over the
same time period.
B.
Regional Changes in Employment and Business
Patterns
As indicated by data provided by New Hampshire’s
Department of Employment Security, between 1990 and 2000, total employment in
New Hampshire increased from 592,000 to 666,000 jobs – representing an increase
of approximately 74,000 jobs (12.5%).
On a countywide basis, Carroll County’s 2000 employment base of 21,276
jobs represents an increase of approximately 2,700 jobs (14.5%) since
1990. Approximately 3% of New
Hampshire’s employment base is located in Carroll County.
As job growth in New Hampshire experienced
significant gains throughout the 1990s, so to did the number of business
establishments. The number of new
businesses in New Hampshire increased by more than 9,600 from 1991 (30,353
businesses) to 2000 (40,005 businesses) – representing an increase of 32%. Carroll County experienced solid business
establishment growth over the same time period increasing from approximately
1,332 businesses to 1,678 representing an increase of 356 businesses
(27%). At approximately 1,700
businesses, Carroll County contains about 4% of the statewide business
establishment base.
Although examining total job and establishment growth
provides a good indication for economic direction, an analysis of the types of
jobs and establishments created provides a clearer economic picture. Similar to many states, most of New
Hampshire’s jobs are concentrated within the trade and services sectors. As of 2000, approximately 64% of New
Hampshire’s jobs were either service or trade related – representing an
increase of 5% since 1991. As indicated
in Figure 4-2, between 1991 and 2000, approximately 100,000 trade and service
jobs were created in New Hampshire representing 80% of the total employment
positions created. Employment growth
was also strong within the construction (7,800 jobs) and manufacturing (7,700)
sectors over the same time period.
Similar to the growth within the service and trade
sectors throughout the state, between 1991 and 2000, 77% of the jobs created in
Carroll County fell within these industrial sectors. Significant employment gains were also experienced within the manufacturing
(574 jobs) and the construction (494 jobs) sectors. While most sectors experienced job growth, employment within the
transportation, communications and public utilities (TCPU) sector remained flat
while the number of financial, insurance and real estate (FIRE) jobs decreased
by 77. Interestingly, almost 80% of
Carroll County’s employment base is within the service and trade sectors – 16%
more than the statewide average. The
large percentage of jobs within the service and trade sectors is likely
attributed to Carroll County being a primary destination for tourists. Figure 4-3 shows employment growth in
Carroll County by industrial sector between 1991 and 2000.
A change in the number of new businesses in New
Hampshire primarily reflects growth in statewide employment (see Figure
4-4). Similar to statewide employment
growth, three of every four businesses that were created between 1991 and 2000
were service or trade establishments.
In terms of business distribution, currently 70% of business
establishments statewide are service or trade related – representing an
increase of 1% since 1991. Besides the
growth in service and trade establishments, New Hampshire’s FIRE and
construction sectors also experienced significant growth increasing by 730
(33%) and 576 (18%) business establishments respectively over the same time
period.
Of the 356 businesses created in Carroll County
between 1991 and 2000, almost 55% (195) were service industry
establishments. Other sectors that
experienced significant growth include the trade (62 businesses or 12%),
construction (37 businesses or 22%) and manufacturing (34 businesses or 53%)
sectors. Interestingly, although
employment within the TCPU sector was flat and the FIRE sector lost jobs
between 1991 and 2000, the number of businesses within these two sectors
increased by 12 and 7 establishments respectively. This finding would potentially indicate that both of these
sectors are experiencing growth in very small or “start-up” businesses. Figure 4-5 presents the growth in businesses
by industrial sector for Carroll County between 1991 and 2000.
C. Changes in
Employment and Business Establishments in Conway
As noted earlier, employment in Carroll County
increased significantly during the 1990s. Conway has also benefited from these
changes. Total employment in Conway has
increased from 4,421 jobs in 1990 to 5,072 jobs in 2000, representing an
increase of over 650 jobs (15%). As
indicated in Figure 4-6, most of these employment gains occurred during the mid
1990s.
The growth in business establishments in Conway also
reflected the significant business growth found throughout Carroll County. The total number of establishments in Conway
increased from 493 in 1991 to 602 in 2000, representing an increase of 22% or
4% below the county establishment growth rate.
As noted in Figure 4-7, most of the growth in business establishments
came with the upsurge in economic growth during the late 1990s. Furthermore, as the national and statewide
economy started to show signs of contraction in 2000, the number of businesses
in Conway declined by twelve establishments during that year – the first period
of negative establishment growth between 1991 and 2000.
As illustrated in Figure 4-8, over half of the jobs
in Conway are within the trade sector, with almost 40% of the remainder being
within the services sector.
Collectively, about 92% of the jobs (over 6,200 jobs)[2]
in Conway are either service or trade related – approximately 13% more than the
county average and 28% more than the state average. The manufacturing and FIRE sectors comprise a small portion of
Conway’s employment base with 309 (4.5%) and 247 (3.6%) jobs respectively.
Compared to the distribution of employment in Conway,
the types of businesses located in Conway are slightly more diverse. As indicated in Figure 4-9, trade (296) and
service (219) businesses account for nearly 86% of the town’s establishment
base, followed by FIRE (39 or 4% of the total) and manufacturing (30 or 5% of
the total) establishments.
As illustrated in Table 4-1, it is not surprising
that with over 80% of the town’s establishment base is concentrated within the
trade and service sector, and most of the largest employers are all within
these sectors. The only exception to
this finding is the inclusion of the Chuck Roast (clothing manufacturer) that
is within the manufacturing sector.
|
Table 4-1. Largest Employers (2000/2002) |
||
|
Town of Conway |
||
|
Employer
Name |
Product/Service |
# Employees |
|
Memorial
Hospital |
Healthcare |
350 |
|
Conway
School District |
Education |
274 |
|
Hannaford |
Supermarket |
175 |
|
Red
Jacket Inn |
Hotel |
156 |
|
Wal-Mart |
Retail |
140-170 |
|
Sheraton/Four
Seasons |
Hotel |
138 |
|
North
Conway Grand Hotel |
Hotel |
80-100 |
|
Source:
Mount Washington Valley Economic Council |
||
An examination of changes in Conway’s employment
patterns between 1991 and 2000 indicates that employment in trade and services
experienced the most gains with the addition of 680 (23%) and 628 (32%) jobs
respectively. The only other industrial
sector to add jobs was the manufacturing sector which added 149 jobs
representing an increase of 93%. As
shown in Figure 4-10, Conway emulated the employment pattern exhibited by the
county by losing FIRE jobs and zero TCPU job growth.
A slightly different pattern was exhibited in the
number of new businesses created, as all sectors experienced positive business
growth between 1991 and 2000.
Specifically, services and trade led in business growth with 57 (35%)
and 18 (7%) new establishments. TCPU
and manufacturing businesses experienced strong growth with the addition of 15
and 14 new establishments over the same time period. Although TCPU exhibited strong establishment growth between 1991
and 2000, the lack of any TCPU job growth indicates that these new businesses
are highly automated or small operations.
Figure 4-11 indicates the growth in business establishments in Conway
between 1991 and 2000.
D. Location,
Acreage and Building Size in Conway
The town of Conway contains approximately 42,780
acres of land of which about 2,180 (5%) are used for commercial activities and
1,367 (3%) are used for industrial purposes.
Combined, commercial and industrial land accounts for over 3,500 acres
of land (8.3%) in Conway. Most of
Conway’s commercial and industrial areas are concentrated along major
roadways. For example, commercial areas
are primarily along Route 16 in Conway Village and North Conway and along Route
302 in Redstone. Industrial activity is
concentrated in two areas – along East Conway Road and along Hobbs Street in
Conway Village. All land uses in Conway
are categorized by property use codes in Conway’s Property Assessment
database. For example, a selection of
commercial and industrial uses include:
Commercial
