The return of the local economy is a work in progress | Local News
CHEYENNE — Like many things in life, gauging the state of the economy in Wyoming and its capital is not easy. Particularly these days.
Things have mostly steadily improved since some of the biggest economic disruption brought on by the early days of the COVID-19 pandemic, with public health precautions leading some to scale back their daily activities. Both here in Laramie County and in our state as a whole, returning to business activity remains a work in progress.
This is the result of a review of the latest state and industry statistics and interviews conducted by the Wyoming Tribune Eagle last week. Overall, these numbers and interviews show that many industries are well on their way to returning to the good times before the pandemic.
Employment, earnings and other numbers indicate that jobs are plentiful and business is quite strong in most industries. However, the energy sector, Wyoming’s biggest industry, still has a long way to go before its comeback is complete.
Wyoming’s unemployment rate last March was 3.4% seasonally adjusted, still lower than the 3.6% for the United States as a whole, according to a report released Wednesday by the Economic Analysis Division of the United States. Wyoming Department of Administration and Information.
Showing the general strength of economic activity in our state, sales and use tax collections were up 22% in April compared to the same month, according to Dylan Bainer, senior economist with the Economic Analysis Division. from last year to reach a total of $67.7 million.
The intricacies of understanding the state of the economy in The State of Equality were illustrated in a single paragraph of Bainer’s written summary of the Economic Analysis Division report:
“Compared to February 2020 (before the pandemic hit the labor market in March 2020), total employment has still not fully recovered from the pandemic, mainly due to the slow recovery in the mining industry [which includes much of the energy sector]. Compared to February 2020, total employment is down 5,300 jobs, while employment in the mining sector is down 4,700 jobs. Meanwhile, other industries, such as retail trade and professional and business services, have more jobs than they had in February 2020. The construction and recreation and construction industries hospitality industry have roughly returned to pre-COVID employment levels.
In other words, according to experts, the recovery of the energy sector could take longer than that of other industries in Wyoming.
“Most of the economy appears to have recovered from the pandemic, but the energy sector appears to be lagging a bit,” the economist said by phone. It is “close enough to pre-pandemic levels” for “every other industry in terms of employment”.
The bigger picture of energy and the economy gets complicated when you consider the skyrocketing prices of natural gas, the regular unleaded gasoline you put in your vehicle, and the diesel fuel used by truckers. .
Even though many Americans and Wyoming residents are feeling the financial pain of gas stations, rising prices correspond with an increase in energy activity in our state. There were some 7,900 oil and gas workers in Wyoming in March, up more than 10% from a year earlier.
This has not translated into a return of all the jobs in the sector that were lost earlier in the public health crisis. “These jobs are still slow to come back,” Bainer noted.
One way to gauge the strength of oil and gas activity is to count active rigs.
There were an average of 15 active oil rigs in Wyoming during the month of April, with three more for “conventional gas.” That’s a significant improvement from six and one, respectively, in April 2021.
It is far from the zenith. In numbers dating back about 11 years, the highest number of active oil rigs in Wyoming was 40, last seen in November 2014, according to Bainer. For gas, it was 35 in November 2011.
“We are certainly not fully recovered yet. There are definitely some positive signs, but it’s definitely a suppressed industry,” said Ryan McConnaughey, vice president and director of communications for the Petroleum Association of Wyoming. “A lot of this has to do with some of the issues we’re seeing in many industries, including labor shortages, supply chain issues ‘such as difficulty getting steel pipe’, and just the fact that a lot of companies have problems getting access to drilling rigs.
Because tourism and related activities are the #2 industry in our state, and because the price of a gallon of gas can affect whether tourists drive here, these costs are worth watching.
A difference from the past is that now there is believed to be a lot of pent up demand for travel due to people who previously stayed close to home. Such demand is seen in the prices of things like airline tickets, and economists say it’s a contributing factor in fuel prices hitting new highs. Experts also refer to Russia’s war in Ukraine.
“Despite rising gas prices, AAA still expects a busy year for road travel,” spokesman John Treanor wrote via email. He noted that an earlier survey by the group found that people responded that $4 prices would not affect their driving much. “Demand for fuel is high, which has contributed to higher prices at the pump,” Treanor said Thursday.
Gas is more expensive than ever, according to the AAA Automobile Association and others. It was $4.42 Thursday for a regular gallon of unleaded gasoline, on average, across the country. It was $4.23 in Wyoming and several cents less here in Laramie County.
Prices may continue to rise, at least for a while.
“Liquid fuels have turned into liquid gold, with gasoline and diesel prices spiraling out of control with little power to exploit them as the imbalance between global supply and demand continues to widen with each passing day” , wrote Patrick De Haan, head of oil. analysis at the GasBuddy price comparison service. “There is little, if any, good news on fuel prices before the summer.”
At Little America in Cheyenne and other local businesses, that hasn’t translated to canceled trips, station general manager Tony O’Brien said. It also didn’t slow down trips to the property’s gas station, he noted. “Even with high prices, we really haven’t seen fewer gallons sold.”
Summer and fees
Continued consumer demand for travel should allow for a strong summer tourist season, O’Brien said, noting that he was not speaking on behalf of any of the tourism boards of which he is a member.
“It’s definitely been a good start to the year, and we’re anticipating a steady summer, similar to last year,” O’Brien said. “We are a bit optimistic to be ahead of last year for the summer months. I think the trip will be strong. He cited the 150th anniversary of Yellowstone National Park among the things that draw visitors to our state.
It’s also more expensive to live here, O’Brien and others have noted. Recently released statistics from the state and other sources show that prices for buying a home or renting accommodation have gone up.
Last week’s state report shows more than 500 single-family residential building permits were approved in Wyoming in the first three months of 2022. That compares to 408 in the first quarter of 2021 and 267 for the same period in 2020. The latest figure set a record, dating back to at least 2010, according to Bainer. “The 542 single-family dwellings authorized until the end of March 2022 are a little above average.”
This strong demand for housing has translated into higher prices in our city, county and the state as a whole. In the part of Laramie County outside of the city of Cheyenne, for example, homes have averaged over the half-million dollar mark for sale prices.
Factors like inflation have prompted employers to increase what they pay, companies and experts say.
“I think everyone’s increased their pay, including us,” O’Brien of Little America said. He noted that in such a competitive market to find employees, it is important to have a workplace that itself attracts and retains staff, which he called a good work environment and culture. . That, along with a slightly better market for those hiring compared to last year’s number of quits, has helped, he said. “We’re still looking for people and it’s tough, but a lot of companies have at least increased their workforce to such an extent that we’re not bleeding every day.”
A local company, Taco John’s, has also raised wages, made sure its benefits are attractive and is trying to be a place people want to work. The restaurant, drive-thru/pickup and food delivery app chain “provides a fun and fulfilling work environment,” said Barry Westrum, chief marketing officer.
“The wage hike has really been going on for over a year now. When businesses reopened, you just had that gap in terms of the number of employees available” compared to the needs of employers, and “it’s all in retail,” Westrum said by phone from Minneapolis, where the company opened a satellite office as part of the growth plans “We struggled with it,” and “it really puts the employee in the driver’s seat.”
Like other businesses, not to mention consumers, the chain faces higher food prices. Rising raw material costs for things like cheese and meat mean that “we are watching very closely what price increases we have to take to cover the cost increase, but also to make sure our consumer is willing and able to pay,” Westrum said Friday. “So far we think we are doing a good job. But we believe that this situation is not going away anytime soon.
“Whether you’re McDonald’s or Taco Bell or Burger King or whatever, everyone seems to be saying the same thing. The conditions we see in the economy and in our business are (largely) not geographic,” the executive said. “Consumer concern over inflation and especially low-income consumers is affecting traffic in our industry.”
This has resulted in some consumers earning less for reducing their purchases, even when driving traffic increases. Taco John’s total sales are at record highs, and it’s expanding to other western states like Arizona, Texas, and Utah and moving to the eastern United States.