SDI Economic Ledger: Discussing the Importance of the Visitors Industry; Importance of Continued Investment in the Market; Three SDI Economic Indicators are Up
SAN DIEGO, CA – The San Diego economic indicators tracked by the San Diego Institute for Policy Research (SDI) continue to trend downward. Although three of the April 2007 indicators were up compared with the previous month, all key indicators – construction, unemployment, new business licenses, the regional stock indices, and consumer confidence - continue to show lowered activity when compared with the previous year.
Residential construction shows the greatest downturn. Despite a spurt of multiple units authorized in March 2007, the number subsequently fell back down 45 percent in April. Over the past year, the number of units permitted has declined by 21 percent.
San Diego’s unemployment normally declines from March to April as businesses ramp up to meet summer demand. This April, however, saw an increase, the first rise of unemployment during April since 1995.
The local stock index continues to be extremely volatile. While it posted the highest gain in several years in April, increasing 6.3 percent, the index remains 1.4 percent lower than it was a year ago.
SDI’s latest “Economic Consumer Confidence Index” shows a somewhat surprising twist as local consumers’ outlook for their own situations improved, while their views on the local economy continued to erode. “Record-high gas prices and continued sluggishness in the housing market may be souring the outlook,” says Kelly Cunningham, Sr. fellow economist with SDI, “although consumers have a better view of their own situation.”
In this month’s in-depth report, the San Diego Economic Ledger focused on the region’s visitors industry. SDI reported strong gains in occupancy and a record number of room nights sold. In San Diego, an all-time record 32.2 million people visited San Diego County during the past year spending approximately $7.7 billion. Meanwhile occupancy levels rose to a very healthy 73.3 percent, one of the highest occupancy rates in the nation.
“The recovery and current performance of San Diego’s visitors industry is most impressive,” says Steven Francis, chairman and founder of SDI, “especially in light of the industry’s nation-wide struggles following 9/11.” He went on to add, “It is a testament to San Diego’s natural assets and should remind us that it is critical that the public and private sectors continue to make our region a prime destination for visitors.”
Despite this impressive performance, the San Diego Convention and Visitors Bureau budget has been cut more than 37 percent the past few years. Cunningham noted, “With fewer marketing dollars because of government budget cutbacks at a time when competing markets step up their attraction efforts makes duplicating past performance much more difficult.” He added, “the need to keep local hotels brimming as even more rooms are added will be a formidable challenge for the local hotel industry.”
About the San Diego Institute for Policy Research
The San Diego Institute for Policy Research (SDI) is a non-partisan organization whose goal is to improve the efficiency and effectiveness of the public sector throughout San Diego County. Established in 2006, SDI produces high quality policy research papers, economic bulletins, and public opinion polls, and holds major events and symposiums to help generate debate and discussion among San Diego’s decision makers and citizens alike.
