COURT HOUSE – “The county was well on its way to another record year” when “the bottom fell out,” said Freeholder Director Gerald Thornton.
No one yet has a comprehensive handle on the novel coronavirus’s full economic impact since it first appeared in the county March 18. The pandemic’s economic devastation isn’t over, as the county struggles with a second wave of new cases larger than the first.
The impact on the economy has been variable. Many small businesses in the traditional hospitality structure struggled, and some succumbed to the strain of lockdowns, partial reopening, capacity limits, and the additional costs of doing business. Some areas of the economy have done well.
Before the virus appeared, the county had the highest yearly unemployment rate in the state and the lowest median household income, allowing the virus to do its damage to some sectors of the population already suffering with “underlying conditions.”
Yet, the county also experienced an unexpected boom in high-end real estate sales and new home construction, as well-off urban dwellers decided to seek space and relative safety from the disease.
Amid the pandemic’s ravages of the traditional tourist-based economy, the county became an attractive place to live for those who could afford to flee the density of urban living.
A recent panel discussion on tourism at the Jersey Shore, conducted by Stockton University experts on South Jersey’s economy, focused on the fact that the summer at the shore went “better than expected,” with economist Dr. Oliver Cooke cautioning that better did not mean good.
The economy did not quite crater in the way many feared in April, but the damage was real. With some bounce back in July and August, and with longer stays by vacation homeowners, unemployment remained high, even after the federal boost expired.
The closed border with Canada, shuttered and capacity-limited casinos in Atlantic City, problems with the J-1 visa program, indoor and outdoor gathering limits, and moving restrictions that hampered planning contributed to lost business.
Vicki Clark, president, Cape May County Chamber of Commerce, praised business owners for being creative. She pointed to positives as lost Canadian visitors were partially offset by newcomers who had not visited the county before.
Clark said that the camping industry in the county saw an increase in activity, also noting that outdoor dining was surprisingly successful, something, she believes, will remain a part of summer offerings going forward.
Cooke agrees that businesses showed remarkable ingenuity, but tries not to overplay the positives. The economy, he states, was still down, even after high summer rebounds. He argues that the South Jersey Shore economy will take time to recover. The recovery will be driven, he believes, by changes in consumer behavior.
“Some consumers already feel comfortable returning to old ways. Others may still hold off,” said Cooke. He offered no prediction.
“It is hard to say how that will balance out,” he added.
For Cooke, there are major unknowns. The timing of a generally available vaccine will be critical to recovery. He points to the need for another federal stimulus package to aid state and local governments, something, he said, is not advancing in Washington.
Cooke also looks at the unemployment numbers and argues for more unemployment insurance benefits. “I don’t know any business that would not rather have money in the pocket of consumers,” he said.
The boom in real estate purchases and long-term rentals has Clarke hopeful that the pandemic will help people see that the county is a “wonderful place to live.” She sees an opportunity to promote more year-round living.
Population loss has been a feature of the county’s experience since 2000, the point at which the census recorded the peak population totals for the area.
There is little doubt that the pandemic made Cape May County an attractive place to wait out the spread of the virus. Every feature of municipal service from fire and emergency medical technician (EMT) calls, to trash removal, to water usage showed “more people” in the island towns.
Basic statistics show that the year-to-year sale of housing units increased over 2019, that active inventory is down, according to one realtor, by 45% in October, and that the median sale price of homes increased.
Cape May County Tourism Director Diane Wieland suggested that longer stays by vacation homeowners and an increase in longer-term rentals might mean a drop in the traditional flow of people who visit for shorter periods, keeping county amusements supplied with new visitors. If so, what might a change in that rhythm mean for those businesses?
For some businesses, a rebound during the peak summer months helped them cope with an unpredictable year. For others, the bottom fell out, as Thornton suggested, with recovery, if possible, a long way off. New patterns emerged, but it’s too early to tell their long-term impact.
To contact Vince Conti, email vconti@cmcherald.com.
