MISSISSIPPI GULF COAST – Everyone knew that the economic boom of the 1990s on the Coast couldn’t continue forever. But while the general economy is
currently experiencing a slowdown, it hasn’t yet caused much alarm.
“The general economic state of the Gulf Coast appears to be cooling off in many sectors,” said Dave Dennis, chairman of the Mississippi Gulf Coast Chamber of
Commerce and president of Specialty Contractors & Associates. “We have seen incredible growth and expansion of the economic sector for seven to eight years, and
a plateau or respite should not be totally unexpected. The economy remains strong, but is not growing at the level of acceleration seen in recent years. Interest rates
may be compounding the softness. Most businessmen will agree the economy is still good, but a bit softer than 1998-1999.”
Chevis Swetman, president of The Peoples Bank in Biloxi, agreed that the economy is leveling out.
“We have had an absolutely incredible economy going back to 1991. It has been almost continuously uphill except for a few little dips in 1995 and 1998,” Swetman
said. “I don’t think we’re in bad shape, but it has sort of plateaued. If you follow the stock market, it looks like it is trying to build a stronger base before it takes off to
the next level. Basically, that is what I’m seeing here with the Gulf Coast economy.”
Swetman points to gaming revenues for Biloxi as an indication that the economy continues to grow, but not at the higher rate that has been the norm in recent years.
For example, gaming revenues in August were up 17% over August 1999, as opposed to an increase of 6.25% in September compared to a year earlier.
A lot of construction backlog has been eliminated with the conclusion of major Beau Rivage and Grand Casino projects, in addition to rebuilding from Hurricane
Georges in 1998 and completion of the new Crossroads Shopping Center in Gulfport. Swetman said that has an upside as construction labor is now more readily
available, and builders are working to make houses more affordable in a tightening housing market.
The fourth quarter is traditionally a time of the year when the tourism-based economy of the Coast slows. Swetman predicts the next six months will be slow. But he
hopes that the Federal Reserve will reduce discount interest rates sometime in the spring, which could help revive the economy.
“Another big factor affecting the economy is the price of gasoline, which we don’t have any control over,” Swetman said. “That creates a double whammy. It costs
more to borrow money, and it costs more to get goods into the marketplace. I consider what is happening with oil prices a phantom tax on the economy. I think the
high gasoline taxes are holding us back not just here, but all over the country.”
Higher gasoline prices could impact tourism and casinos since many are drive-in visitors. Casino executives have expressed concern over the fact that increased costs
of marketing have cut into profits, and some executives have predicted that the next three months will be tough.
Real estate agents report that home sales have slowed, particularly the sale of higher priced homes. David Nichols, chief administrative officer for the City of Biloxi,
said that building permit activity has slowed down.
“There is a still a good bit of activity going on,” Nichols said. “We’ve gone through a really big growth spurt, and I think that some leveling off would be expected.
“Sales tax revenues seem to be staying steady. We’re not seeing any big hiccups in sales tax. Gaming revenues seem to be up a little bit over the previous year. I think
we are in good shape. I think we are seeing a little bit of a slowdown, which is what we would expect this time of year. It is definitely not anything to panic over.”
Steve Dickerson, business development coordinator for the City of Gulfport, said growth in sales tax revenues has offset declines in other economic sectors. Sales tax
revenues for the fiscal year were up 10%, an increase of about $400,000.
“We’re real happy with our sales tax revenues,” Dickerson said. “The new businesses opening have continued to grow sales tax revenues. The new Chili’s Restaurant,
for instance, has been the highest producing store in the Chili’s chain since the restaurant opened at Crossroads. There has also been an announcement from the group
that operates Crossroads that they are going to open an upscale clothing section, 30,000 square feet of upscale women’s and men’s clothes.”
Building permits are also up in Gulfport. In 1999 the city issued 6,363 permits. By October 22 of this year, 6,796 permits have been issued. “So with two months to
go, we have already issued more building permits than last year,” Dickerson said.
Gaming revenues for Gulfport in August were up about 5% over the previous year. But the growth in casino revenues hasn’t been as high as seen in earlier years.
Dickerson said that previously the growth continued even in the portion of the year from after Labor Day to Christmas that has traditionally been a slow time for
casinos across the country.
“We haven’t seen the fall slowdowns before because the casino industry here was growing so fast,” he said. “But now we’re starting to see the type of falls that are
more traditional in the casino industry.”
In Jackson County, the economy has been flat for about four months. But Terry Carter, president and CEO, Jackson County Chamber of Commerce, said that in the
past 30 days there have been some indications that the county’s economy is beginning to grow again.
“It is coming out of the flat stage,” Carter said. “For example, consumer deposits with banks and new car sales have increased some. So we are beginning to move
back up. The point we want to remember here is when our county’s economy was flat for a short time, it was flat at a very high level. We have been through a
substantial growth period, and now are starting to move up again. Right now while Jackson County’s economy is moving up, the national economy is flattening out.
Jackson County has been recession proof in the past, and we certainly hope that continues to be the case.”
The number of industries in Jackson County that rely on long-term government contracts, such as Ingalls Shipbuilding, has helped cushion the county from recessions in
Contact MBJ staff writer Becky Gillette at email@example.com or (228) 872-3457.