Along Main Avenue, merchants are anticipating a bustling tourist season to match last year, but other sectors of the economy across La Plata County aren’t looking as healthy.
Sales taxes in Durango have been increasing steadily, but other economic indicators, including gas and oil activity and the number of people working in the county, were slightly down in the early months of 2015, said Roger Zalneraitis, executive director of the La Plata County Economic Development Alliance.
“Things look slow in 2015,” he said.
In February, for the first time in 2½ years, the alliance’s economic indicator dipped below zero to negative 2, which is considered neutral growth. The number is based on growth and declines in major sectors of the economy, including real estate, gas and oil, construction and among others.
From January through March, the number of people employed each month has been slightly lower than the year previously, even though the unemployment rate has dropped.
Some of the declines could be driven by a stall in gas and oil production.
“When the oil prices plummeted, that led to a slack in drilling,” he said.
Home prices and median salaries also could have a healthier relationship, which would promote more sales. In March, the median home price in Durango was $410,000, but the median annual salary is far lower than what’s required to buy a home in this price range, he said.
“We don’t have the supply to meet where the demand is,” he said.
Contractors are seeing the demand imbalance, as well, but they have plenty of work, said Lisa Laughlin, executive officer of the Home Builders Association of Southwest Colorado.
“They are feeling a lot of pressure to produce,” she said.
The rain in May has forced many projects to start late, Laughlin said.
But the rain hasn’t dampened optimism in the core of downtown.
Sales-tax growth has been steady for the last few years. A recent nonscientific survey of 54 businesses by the Business Improvement District showed 2014 was a fairly good year for businesses across Durango.
“(Last year) was at least flat and, in a good number of cases, better than 2013,” said Tim Walsworth, BID’s executive director.
July, August and September were particularly good months, when 58 percent of those polled saw growth. Across the city, the second- and third-highest months for sales-tax growth were August and September.
This year, some national indicators such as low gas prices, low unemployment and harsh winters could add up to crowded streets this summer.
“All those indicators are setting us up for an awesome summer,” Walsworth said.
The owner of Rio Grande Trading Co., Marsha Scheutz said sales are off to a positive start, besting last year’s May sales.
“Everybody seems more upbeat, more willing to spend some money,” Scheutz said.
Currently, she said downtown is in a lull, but she expects things to pick up in mid-June with the arrival of more tourists, mostly from Texas, Oklahoma, New Mexico and Arizona.
mshinn@durangoherald.com
