Douglas County and Recent Business Trends

by Annette Shelton-Tiderman

June 20, 2018

The overall industry mix of southwestern Oregon’s Douglas County tells only part of the story behind the county’s recent economic resurgence. At first glance, the government sector accounts for one out of five jobs. However, government employment includes many working in education and health services. Somewhat unique, Douglas County is not only home to a federal veteran’s hospital, it also boasts a vital local government health care district in coastal Reedsport. By combining these public-sector jobs with those in private-sector education and health services, the county’s largest source of employment is actually associated with education and health care. This combination accounts for nearly 23 percent of the county’s payroll employment.
Trade, transportation, and utilities also make a strong contribution to Douglas County’s economy – nearly 18 percent of employment and the county’s second largest payroll ($221.5 million, 2017) after government. Retail trade accounts for more than two-thirds of the jobs in this large sector. The modest payroll, $120.4 million, reflects the often seasonal and part-time nature of these jobs. Frequently associated with retail endeavors, leisure and hospitality jobs account for 9 percent of employment. The total payroll of this seasonal sector is almost $58 million, an average of $16,820 per year.

Professional and business services offers a wide range of employment opportunities. Although the county’s professional workforce, e.g., accountants, attorneys, engineers, are included in this arena, about 62 percent of the sector’s employment is generated by staffing agencies and other businesses providing support to area enterprises. The employment levels of these business service providers ebb and flow with prevailing business needs.

Manufacturing and construction, hard hit by the recession that started more than a decade ago, continue to regain lost ground and offer a variety of jobs across the area. Since 2012, manufacturing employment has gained an additional 16 percent, and payroll has grown nearly 20 percent. During the same time, construction has outpaced all other industries by adding 45 percent to its workforce and nearly 65 percent to the value of its payroll.
Focus on Wage Ranges Within Broad Industry Groups

Oregon’s three-tiered minimum wage ranges, with incremental increases scheduled for each July 1 between 2016 and 2022, enable businesses in different geographies to better adapt to local economic conditions. Douglas County’s 2017 minimum wage has been $10 per hour; this will increase to $10.50 on July 1, 2018. During 2017, 7.8 percent of the county’s jobs paid the minimum wage. Leisure and hospitality, and retail trade accounted for approximately 40 percent of minimum wage jobs (27.8% and 12.1%, respectively). Nearly two-thirds of the county’s jobs pay less than $20 per hour, and almost all jobs in leisure and hospitality and most of those in retail trade pay less than $20 per hour (92.7% and 81.9%, respectively). Sectors offering opportunities at higher wage levels, e.g., greater than $62,000 per year, include government (state: 30.8%; local: 29.8%); financial activities (28.8%); private health care and social assistance (28.2%); construction (24.8%); and transportation, warehousing, and utilities (18.8%).

Contributing to the financial well-being of area residents are the short commuting distances associated with employment. Nearly 50 percent of Douglas County’s workforce lives within 10 miles of work, and another 20 percent commute between 10 and 24 miles. For those employed in the trade, transportation, and utilities sector, 37 percent live within 10 miles of work, and just over 15 percent commute 10 to 24 miles.
Tourism’s Contributions to Douglas County’s Economy

Although most of the tourism-related activities are associated with retail trade, and leisure and hospitality businesses, other businesses contribute to the travel industry’s impact on the county’s economy. Local transportation and gas, air transportation, and food stores also play a role in tourist spending. In 2017, direct travel spending in Douglas County was $237.5 million – an increase of 8.1 percent from 2012, according to Dean Runyan and Associates. By commodity purchased, Douglas County saw $67.2 million spent on food services; $38.5 million on accommodations; and $40.7 million on arts, entertainment, and recreation. Other commodities made up the balance. Rates of direct travel spending were on a rising trajectory prior to the Great Recession. However, the economic downturn and associated decrease in discretionary spending resulted in a substantial drop in business revenue and employment. By 2009, direct travel spending had dropped from $216.4 million (2008) to $197.5 million. Since then the travel industry in Douglas County has seen a steady resurgence.
Douglas County’s Sole Proprietors

Although nearly 96 percent of the workforce is retained by businesses participating in the Unemployment Insurance program, sole proprietors in Douglas County make a noticeable impact on the economy. In 2015 (the most recent data available from the U.S. Census Bureau), the county’s nonemployers generated $244.6 million in sales receipts. Real estate, rental, and leasing activities ranked first, reporting $49.8 million; construction reported $35.6 million; transportation and warehousing reported $23.2 million; retail trade reported $23.1 million; and agriculture, forestry, fishing, and hunting reported $17.9 million. The greatest number of sole proprietors were found in other services – a general industry group which includes such enterprises as grant making; civic, professional and similar organizations; repair and maintenance businesses; and personal and laundry services. Businesses in real estate, rental, and leasing; retail trade; construction; education and health services (primarily health-related activities); and professional and business services were leading arenas for sole proprietors.
Summary

Douglas County’s economy has weathered a number of economic downturns over the last 40 years. The core industries continue to show resilience. The strong education and health services sector, a combination of private- and public-sector entities, provides employment to a substantial number of county residents. The tourism industry with its strong retail trade, and leisure and hospitality components, offers not only a variety of employment opportunities, but also serves to bring outside dollars into the area. Well-positioned to continue its pattern of development, Douglas County has become an economic and cultural hub in southwestern Oregon.


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