LEAD Hampton Roads, a program of the Hampton Roads Chamber, hosted its 14th Annual State of the Region Address on October 1 at the Norfolk Waterside Marriott and on October 4 in Newport News. Dr. James Koch, ODU president emeritus and professor of economics, and ODU economics professor Gary Wagner spoke to more than 700 business professionals, community leaders and elected officials from Hampton Roads. Topics included sequestration, coal, the housing market, city government spending and the Asian Indian community in Hampton Roads. The content of the address based on the annual report produced by the Regional Studies Institute at Old Dominion University. All 14 of the State of the Region reports may be found at www.odu.edu/forecasting.
Dr. Koch said, “Because of sequestration some really bad things could have happened, but it could have been worse. We didn’t do so badly after all.” The rate of Hampton Roads’ economic growth slowed in 2013 to 0.94%, down from 1.53% last year. The economic slowdown has been deep and long. At the current rate of U.S. job recovery, it will be September 2014 (80 months from the beginning of the recession) before the country will have recovered all of the jobs we lost between 2008 and 2010.
The three large sectors in our region’s economy are defense spending, the Port of Virginia and hotels/tourism. Defense spending is the most important and in 2013 will account for $21.13 billion in direct spending in our region. The region’s economy is diversifying because military spending is dwindling. Direct federal defense spending has fallen. Sequestration has cost the region 4,000 jobs. Wagner said, “I think we dodged more than a bullet. I think we dodged a hand grenade.”
Dr. Koch discussed tolls, saying that they could divide the region if they are too high. He mentioned Norfolk’s light rail system and said that it needs to connect more population centers.
The recession hit the region’s tourism industry very hard. In 2012, only the city of Virginia Beach saw an increase in REVPAR, revenue received per available room. Williamsburg faces long-term challenges attracting tourists.
The report says that the area’s residential housing market is “on the mend.” Sales and prices are up and foreclosures are down.
LEAD Hampton Roads thanks the following sponsors: Optima Health (Presenting); Bon Secours Virginia Health System (Platinum); Damuth Trane, McDonald's, Saint Leo University, TidewaterBiz.com (Gold); Clark Nexsen, EVMS, Seventh Point, Willcox & Savage (Silver).