The metro area’s job growth, which has been slipping through 2018, is expected to pick up for a year or two, thanks largely to single-terminal renovation of the Kansas City International Airport.
But challenges remain, mostly in finding the workers that companies need.
Those are among the chief ideas in the 2019 economic forecast prepared by Frank Lenk, director of research services at the Mid-America Regional Council.
“Labor shortages are currently the number one problem for business,” Lenk writes. “Even as the economy cools down, businesses are likely to continue having difficulty matching the skills they need in their open jobs with the worker availability.”
Specifically, the forecast says the Kansas City region and the nation as a whole will each end the year with growth in gross domestic product of 2.9 percent. Kansas City slips to 2.7 percent in 2017, and the country slips to 2.1 percent, and growth for both slows further in 2020.
Put another way, “... the KC economy is forecast to outperform the national economy over the next two years after underperforming it in 2017 and staying even in 2018.”
A big factor is employment from the KCI project, expected to cost at least $1.3 billion. The airlines are paying for that, so the project means a huge infusion of money into the area.
Meanwhile, businesses are coming and going, growing and shrinking. Harley-Davidson (800 jobs in Kansas City) leaves in 2019, Procter & Gamble (380 jobs in KCK) leaves in 2020, and next steps for DST (hundreds of layoffs so far after a change in ownership) are unknown. Meanwhile, T-Mobile’s takeover of Sprint is likely to cause the loss of headquarters jobs here but perhaps the creation of others so it’s “difficult to estimate the net employment effect of the merger,” Lenk writes.
Cerner, on the other hand, keeps building out its south Kansas City campus, Garmin is adding 2,600 jobs in Olathe, and Burns & McDonnell is expected to add 700 people by 2020. All in all, Lenk said, this is “normal creation and destruction in a dynamic economy.”
Still, Lenk says the current construction boom “masks some underlying weaknesses in the regional economy” on basic measures such as GDP and job growth. Kansas City is near the bottom among its peers – 26th out of 31 – that include Austin, Indianapolis, St. Louis, Oklahoma City, Seattle and Sacramento in GDP growth.
Long term – and we’re heard this before – the concern is getting workers ready for good jobs.
“Given the likelihood of persistent labor supply needs,” Lenk writes, “the region that best solves its workforce issues will have a significant competitive advantage over its peer metros.”
A ribbon-cutting for the Lion’s Choice roast beef restaurant in front of Menards on Little Blue Parkway in Independence is set for Nov. 28. Ribbon cuttings and grand openings often don’t align closely with the actual opening of the doors for business. No word from Lion’s Choice on that. … A new company is coming to the massive warehouse once occupied by Toys ‘R Us in Lee’s Summit south of U.S. 50. It’s Mid-States Distributing, which says it plans a $35 million investment in the 725,769-square-foot facility. It plans to hire 30 to 35 people. Mid-States describes itself as a farm, ranch and home retail cooperative with 675 stores in the U.S. and Canada. It says easy access to various interstates was a major factor in its decision to come to Lee’s Summit.
This is worth noting in passing. The Little Blue Valley Sewer District is celebrating its 50th anniversary. A large sewer system – this one designed to spare the Little Blue River a growing load of pollutants – isn’t very exciting, but few things have done more to open the way for growth in Eastern Jackson County that the creation of this district.
Executive Director Greg Boettcher accepted congratulations on Tuesday from the Jackson County Legislature but stressed that the credit really goes to the local leaders 50 years ago who had the foresight to have cities stop dumping their pollution into the river.
The area could have had 13 cities build 13 sewer treatment plants.
“But the leaders 50 years ago said, ‘Let’s build one,’ and they did,” Boettcher said.
This is one more illustration of how infrastructure, though often taken for granted, is a vital underpinning of economic development.
“And they created the solution that’s bigger than themselves.” Boettcher said.
Jeff Fox is The Examiner’s editor. Reach him at 816-350-6365 or email@example.com