Orlando Pulling Florida Out of Recession
Miami and Orlando continue dragging Florida out of recession, but only Orlando is performing above its economic weight class.
Though Orlando represents just 14 percent of Floridaâ€™s 7.2 million-person workforce, it accounts for 46 percent of the Sunshine Stateâ€™s 44,000 new jobs in the latest monthly report. South Florida, home to 30 percent of the stateâ€™s workers, accounts for 44 percent of the new jobs.
Orlandoâ€™s muscular role in the recovery makes sense, given the tourism rebound that hit Florida well before other industries showed signs of life. But Orlandoâ€™s vitality also highlights Central Floridaâ€™s lead over South Florida when it comes economic growth, and why analysts increasingly look north for the Sunshine Stateâ€™s next boom.
â€śOrlandoâ€™s position has risen compared to its peers,â€™â€™ Wells Fargo economist Mark Vitner told reporters Thursday during his annual review of Floridaâ€™s economic outlook. â€śItâ€™s certainly coming out ahead of the other large metropolitan areas in this recession.â€™â€™
Vibrant medical and technology sectors give Orlando bragging rights as economic development agencies across Florida try to supplement low-wage hospitality jobs with industries generating well-paying careers.
A new â€śMedical Cityâ€ť park tied to the University of Central Floridaâ€™s medical school is expected to jumpstart an already bustling $3â€‰billion industry tied to bio research, according to the Metro Orlando Economic Development Commission.
Orlandoâ€™s strong video-game industry also supports a lucrative niche of combat simulation, pumping tens of millions of dollars worth of Pentagon contracts into Central Florida.
â€śThe high-tech workforce in Orlando is growing,â€™â€™ said Chris Lafakis, who follows Floridaâ€™s economy for Moodyâ€™s.
South Florida boasts its own bio-medical hopes, most notably in the new Scripps research center in Palm Beach County, but also a University of Miami medical park under construction in the health district centered around Jackson Memorial.
And Orlando lacks the boost from foreign trade enjoyed by South Florida, where commerce tied to booming Latin American economies helped shield Miami-Dade from an even bigger downturn during the recession.
In the last 12 months, South Florida added 1,100 financial jobs compared to Orlandoâ€™s loss of 1,500, hints of a broader recovery, said Jaap Donath, vice president of research for the Beacon Council, Miami-Dadeâ€™s economic development agency.
â€śCompanies are hiring,â€™â€™ Donath said. â€śTheyâ€™re hiring across the board.â€™â€™
For all the talk of Central Floridaâ€™s diversifying its economy, theme parks continue to dominate. Eighty percent of the Orlando areaâ€™s new jobs in March came from the leisure and hospitality sector, compared to 41 percent in South Florida. (Healthcare was South Floridaâ€™s top growing industry, with 8,700 added positions.) A new Harry Potter park at the Universal Studios theme park opened last summer, boosting tourism and prompting more marketing by Disney and other rivals.
Part of Orlandoâ€™s comeback story stems from its David status compared to the Goliath of Miami. Along with having less than half the workers of the South Florida metropolitan area, the Greater Orlandoâ€™s $100â€‰billion economy also is about 40 percent the size of South Floridaâ€™s $253 billion economy, according to the federal Bureau of Economic Analysis. The smaller the economy and the smaller the workforce, the easier it is to show big gains.
Between 2001 and 2009, Orlandoâ€™s economy grew 55â€‰percent compared to South Floridaâ€™s 39 percent gain, according to the BEA. While no 2010 data is available yet, forecasters expect the trend to continue. By 2014, a UCF forecast has Orlandoâ€™s economy up 31 percent compared to 16 percent growth for South Florida.
â€śOrlando is the most dynamic, and the strongest, economy in Florida,â€™â€™ said William Fruth, president of Policom, a financial research firm in Palm City, near Stuart. Policom ranks Orlando the 27th strongest metropolitan economy in the country, compared to No. 53 for South Florida, an area that includes Broward, Miami-Dade and Palm Beach counties.
Tourism will continue fueling both economies, but real estate factors favor Orlandoâ€™s growth. Situated in the center of the state, it faces none of the natural development boundaries squeezing South Florida.
South Floridaâ€™s coastal boundary also makes housing more expensive, in part thanks to the high cost of hurricane insurance and in part thanks to pure demand for vacation homes near the ocean. At the end of 2010, the median price for a Miami-Dade home ($191,000) was 45 percent higher than the median Orlando price ($131,000.)
â€śThe Everglades are crimping you,â€™â€™ said economist Sean Snaith, who compiles the UCF forecasts. â€śYouâ€™ve got nowhere to go.â€™â€™
Source: Miami Herald, Orlando pulling Florida out of recession, Floridaâ€™s economic slide reversed thanks to Miami and Orlando, though Central Florida is posting a stronger recovery, by Douglas Hanks,Â DHANKS@MIAMIHERALD.COM