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Has the Wichita Economy Hit Bottom Yet?
Thursday, October 01, 2009 3:57 AM


(Source: The Wichita Eagle (Wichita, Kan.))trackingBy Dan Voorhis, The Wichita Eagle, Kan.

Oct. 1--The nation's economy appears to have hit bottom and started to recover.

So, where is Wichita's economy?

The answer is most likely still headed down, experts say.

The Wichita economy is still slowing as the aircraft industry deals with a worldwide evaporation in demand, and the other sectors react to the manufacturers' struggles.

The 2010 economic landscape is the topic of the 30th Annual Wichita Area Economic Outlook Conference today. The Center for Economic Development and Business Research at Wichita State University, which puts on the conference, will release its annual jobs forecast for the Wichita area.

Wichita traditionally lags the national economy by at least nine to 12 months. If that holds true, Wichita's economy won't bottom out until next year and employment won't turn around until 2011.

Potential factors that could keep the local economy in the doldrums:

-- More cuts at the corporate aircraft makers.

-- Production cuts at the city's commercial aircraft suppliers.

-- Cuts in the service sector -- which makes up about 70 percent of employment -- as it starts to grapple with the downturn.

Allan Safarik is guardedly optimistic for the year ahead after suffering through a dismal 2009.

The owner of Safarik Tool Co., a machine shop in Valley Center, he cut his work force from 16 in 2008 to four today. He is just now working his way out of debt because he didn't cut fast enough.

"We are at bottom," Safarik said. "I just don't feel we have more bottom left to go."

State forecast

WSU, which releases its 2010 forecast for Kansas before its metro forecast, is predicting a 0.8 percent decline in jobs across the state next year.

The biggest hit will come in the manufacturing of durable goods, such as airplanes and farm combines. The center forecasts that this sector will lose 10,000 more jobs, or 8.4 percent.

The manufacturing of nondurable goods, such as soybean oil, will also see a loss, but only about 2.1 percent.

Other sectors that will see declines, although smaller, are retail, information technology, transportation and business services.

Health care will gain nearly 2,500 jobs, government will gain 2,400 and financial services and leisure will see small increases.

In sum, said Jeremy Hill, director of the center, the national recovery will slowly seep into Kansas during 2010. The state will lose jobs but at a slower rate than in 2009.

Aircraft outlook

In Wichita, the trends seen at the state level are made sharper by boom-and-bust aircraft manufacturing.




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