In this week’s Economic Report, Dr. Rick Harper discusses the 10th anniversary of the reefing of the aircraft carrier USS Oriskany and its subsequent economic impact, as well as a rise in applications for unemployment benefits nationally.
The USS Oriskany was sunk in May 2006, about 20 miles off the coast of Northwest Florida, creating the largest man-made artificial reef in the world.
Harper said the Oriskany has been “a great innovation for our coastal tourism economy and also a great opportunity for research.”
“It has been 10 years, and it’s a new element in the kind of panoply of resources that await our visitors,” Harper said. “And so, it’s good from that perspective because the people who come to do artificial reef diving down at almost 150 feet, that’s a fundamentally different group of people than might come to Pensacola for a long weekend and spend that weekend on the beach or in the stores ... Anytime you can use our area assets - our beautiful beaches, our clean, clear waters - to bring in a new class of visitor doing something different, that’s a plus for the economy.”
Harper pointed to research figures which show that a diver spends an average of about $700-per trip to come dive the Oriskany.
“And it’s attracting actually a different class of diver than might have been anticipated when it was first reefed,” Harper said. “Subsequent weather activity, Hurricane Gustav, specifically the wave action that reached down that far, was enough to help the Oriskany settle 10 feet deeper into the sandy bottom. Which means that actually it’s what’s called a technical dive now to go down below the level of the flight deck, because it’s right there just shy of 150 feet and so of course that limits the amount of time that a recreational diver could stay down.”
And the interest in the Oriskany has not come at the expense of other tourism draws in the area.
“It has a strong economic impact, it’s not diverting people from other tourism activities they would do in Pensacola,” Harper said. “Instead, it’s a new group of folks.”
While the Deepwater Horizon oil spill negatively affected the USS Oriskany and other tourism activities in that region of the Gulf of Mexico, Harper said “hopefully that impact that has fallen by the wayside.”
Harper said he believes the potential still exists for more opportunities to do research at the USS Oriskany.
Harper also discussed the latest figures from the U.S. Department of Labor, which showed that the number of applications for unemployment benefits rose last week to the highest level since February 2015.
“We’re still below the critical 300,000 number of new applicants for jobless benefits,” Harper said. “We did rise 20,000, this week. We’re up at 294,000, so not quite as good as it has been.”
Employers added 160,000 jobs in April, which is the slowest growth this year. However, Harper said there was reason for some optimism.
“The good news behind that 160,000 was that hours worked rose by four-tenths of a percent and wages rose by three-tenths of a percent,” Harper said. “So when you add those two together and convert it into annual terms it was a really good month in the labor market actually, because that implies a growth rate of over 8 percent in wages. And so, if we could see upward wage pressure like that so that middle class workers could get raises, spend that out there in the economy that would do a lot to push up aggregate demand in the economy, which has been lagging ever since the start of the (Great) Recession.”
Harper also discussed the results of a recent Quinnipiac University poll released this week, which found almost 60 percent of Floridians believe the state’s economy was in good shape.
“Florida has been creating jobs at a rapid pace, the most recent two months have showed a respite in that job growth,” Harper said. “We’ve had numbers that are below 10,000 in each of the last two months. so that’s a little bit disappointing.”
Last year Florida created about 240,000 new, nonfarm payroll jobs, Harper said.
“It would be reasonable to expect that to fall somewhat as the economy slowed, but the last two months are a little bit worrisome. But still, the index of leading economic indicators for the state of Florida doesn’t point towards a recession anytime in the near future.
But you know at the national level in June, we’re going to complete our seventh year out of the Recession. And so that’s a Recession with pretty long legs by historical standards, and so forecasters are starting to talk about the timing of the next economic slowdown for the nation.”
Dr. Rick Harper serves as associate vice president of research and economic opportunity at the University of West Florida and oversees the University’s Center for Research and Economic Opportunity. He can be reached at email@example.com. CREO staff writer Richard Conn contributed to this report. He can be reached at firstname.lastname@example.org.
This article is part of a collaboration between WUWF and the UWF Center for Research and Economic Opportunity.