Sunday, January 17, 1999
N.Ky. economy on fast track
BY PATRICK CROWLEY
The Cincinnati Enquirer
FORT MITCHELL — Northern Kentucky's economy, booming since 1983, should grow at twice the pace of the national economy this year, according to a report due out Tuesday.
“There's no question, this is going to be another strong year for Northern Kentucky's economy,” said Tom Zinn of the University of Cincinnati and the economist for the Northern Kentucky Chamber of Commerce.
Mr. Zinn is scheduled to deliver the chamber's annual economic forecast Tuesday during a 7:15 a.m. breakfast at the Four Seasons Country Club in Crestview Hills.
In an interview last week, Mr. Zinn said he expects the nation's gross domestic product (GDP), the total output of goods and services, to grow from 2 percent to 2.5 percent in 1999.
Taking a similar approach to measure Northern Kentucky's activity with a formula he calls “90 percent mathematical model and 10 percent judgment,” Mr. Zinn said the region's GDP should grow from 4.5 percent to 5 percent this year.
“What has been happening with Northern Kentucky's economy over the last several years just continues to grow and build on itself,” Mr. Zinn said.
“There's more jobs coming in and more people working every year, and there's a cumulative effect that allows us to continue to reap the benefits year after year,” he said.
To starkly show how Northern Kentucky has grown over the last 16 years, Mr. Zinn has come up with what he calls an “incredible statistic.”
Since 1983, the nation's GDP has grown 45.6 percent. Applying that formula to Greater Cincinnati, he has come up with what he calls “gross regional product,” which has grown 58.6 percent in that same period.
Northern Kentucky's gross regional product has grown 135 percent since 1983, he said.
“Northern Kentucky is like some of the economic gazelles around the nation,” Mr. Zinn said, comparing the region with other fast-growing areas such as Charlotte, N.C., Phoenix, Portland, Minneapolis-St. Paul and the Raleigh-Durham area in North Carolina.
Mr. Zinn attributes a number of factors to the area's economic vitality, mainly job growth, an educated and available work force, a good quality of life and lots of new construction and infrastructure improvements and expansions.
For instance, in 1998 two Fortune 500 companies, Ashland Inc. and Gibson Greetings, announced plans to move their headquarters to Covington's RiverCenter office towers along the Ohio River.
Then Toyota announced construction of a parts distribution center and warehouse that will employ almost 500 people. And GE Capital is scouting locations in the area to build a high-tech computer facility where 1,100 high-paying jobs will be created.
“All the pieces fell into place at the right time,” Mr. Zinn said.
In 1998 the Tri-County Economic Development Agency, or Tri-ED, the local agency that recruits jobs and businesses to the area, had the most successful year of its 12-year existence. Nearly 7,000 new jobs were created in or came to Northern Kentucky last year.
“The region's appeal to employers is going to remain strong this year,” said Tri-ED President Danny Fore. “We are in discussions with a couple of companies I can't talk about, but we feel very good about having another strong year in 1999.”
LaFarge Co., a French-based maker of drywall and building materials, is considering building a $100 million plant that would employ more than 100 people at the vacant Silver Grove rail yards between Ky. 8 and the Ohio River in Campbell County.
The state of Kentucky has already approved a package of economic incentives for the company, and local officials are optimistic LaFarge will choose Silver Grove for its plant.
Mr. Fore gives a lot of the credit for the area's growth to the Cincinnati/Northern Kentucky International Airport, where more than 100 direct flights, including several overseas, are offered.
He also said recent efforts by leaders in Northern Kentucky and Cincinnati are starting to pay dividends.
“We're becoming more joined at the hip when it comes to marketing the area, and that's good,” Mr. Fore said. “We're getting more bang for our buck — and everybody benefits.”
John Finnan, president of People's Bank of Northern Kentucky, agrees that the economy looks strong heading into the new year.
“There's no real warning signs like a lot of loan delinquencies or anything like that,” said Mr. Finnan, whose bank has boomed along with the area.
One of several independent banks started in Northern Kentucky this decade, the Crestview Hills-based People's Bank has grown from a start-up to five branches and $130 million in assets in seven years.
“We're seeing money borrowed so people can grow, and most of the customers I talk to say Northern Kentucky's economy should remain strong this year,” Mr. Finnan said.
The boom is even trickling down to the region's less fortunate.
Bob Brewster, director of Brighton Center, a Newport social services agency, said for clients going through job training “there are good jobs available.”
Welfare recipients, who are being forced off of public assistance because of federal welfare reforms, are also doing well finding jobs, he said.
“In the past, I don't think we had the motivation of welfare reform, so people weren't affected, or benefitting, from the improvements in the economy,” Mr. Brewster said.
“But with welfare reform, people are getting off welfare and finding decent jobs that pay pretty well,” he said.
Brighton Center is considering adding more skill training in its jobs programs, Mr. Brewster said.
“Minimum wage just ain't getting it for people,” he said. “They need skills, because in this economy those jobs are out there.”
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