May 2013 was a boom month for construction locally, and May this year suffered in comparison, causing the Greater Waco Economic Index to decline for the first time in seven months, according to a report released Wednesday by Amarillo-based economist Karr Ingham.
One year ago last month, Baylor University secured a permit to build its new $260 million football stadium at Interstate 35 and Lake Brazos. And even before that happened, permits issued between January and April of last year were running 165 percent ahead of the first four months of the previous year.
“So there is absolutely no chance construction activity in Waco in 2014 will match those numbers from 2013,” said Ingham, who prepares a monthly snapshot of local economic trends on behalf of the First National Bank of Central Texas and the Tribune-Herald.
The GWEI slipped to 112.6 in May from 113.3 in April, but was up from the 110.4 in May a year earlier.
“The decline has everything to do with the building permit data,” Ingham said in his report.
Elsewhere among the indicators, spending and employment continued to register modest gains, and the unemployment rate continued to post significant year-over-year declines.
Hotel/motel tax receipts were up sharply for the month, as were the number of permits for construction of single-family homes.
Inflation-adjusted taxable spending rose a modest 1.5 percent compared to May 2013. For the first five months of the year, spending has reached nearly $1 billion and is running a “solid” 4.7 percent ahead of last year, “and the general trend remains one of increase,” Ingham said.
The Waco area has created about 1,600 jobs during the past year, with the rate of growth standing at 1.5 percent, a figure Ingham said he would like to see improve.
McLennan County’s jobless rate in May stood at 5 percent, down from 6.1 percent in May a year earlier.
Auto sales down
The May report reflected a major shift in automobile sales, which dipped 1.3 percent from May a year ago, the first decline of 2014.
“In fact, auto sales posted double-digit percentage year-over-year increases each month January through April,” Ingham said, adding that despite the lackluster showing in May, sales have risen 10.1 percent for the first five months of the year compared to the same period a year ago.
Though building permits fell well below 2013 figures, they were “perfectly” respectable, Ingham said.
With May contributing $33 million, the year-to-date total has reached $131 million, which is the third-highest showing ever.
Permits to build 37 new single-family homes were issued in May, a 94 percent increase from the 19 in May of 2013.
Existing home sales were flat compared to May of last year; however, the May 2013 figure was up 17 percent from May of 2012.
“The real dollar volume of residential real estate sales activity is up by a solid 3.4 percent thus far in 2014 compared to the January-May 2013 period, which in turn was up by over 13 percent compared to the first five months of the prior year,” Ingham said.
Area business leaders
The results of the Waco area’s economic performance in May were presented during a news conference held Wednesday at the First National Bank of Central Texas. Several local business and community leaders attended the session, and had observations about their areas of expertise:
Scott Neal, who will serve as general manager of McLane Stadium, said it has proved challenging to fill the more than 500 food-and-beverage and guest services positions required to make Baylor University’s opening game Aug. 31 against Southern Methodist run smoothly.
“But we still have two more months, and we plan more hiring sessions, so I’m confident we will get it done,” Neal said during an interview after the news conference.
State Rep. Charles “Doc” Anderson, R-Waco, said an estimated 900,000 people will move into Texas by 2015, “and most of the growth will be along the Interstate 35 corridor.” He made the comment during a discussion of Texas’ reputation as a business-friendly state that is creating new jobs.
Brooke Lewis, business development manager at Home Abstract & Title Co., said business there “has been very steady the past three years,” as home sales have remained robust.
“Late last year and early this year, we’ve seen an increase in commercial transactions, and business from builders has increased,” Lewis said.
Hewitt City Manager Adam Miles said the new Walmart superstore to be built at Interstate 35 and Sun Valley Boulevard will double the city’s annual sales tax revenue.
Add new restaurants and smaller stores that likely will follow Walmart to that area, “and we easily could see our sales tax receipts triple.”