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Chamber Speaks

Mountain State Momentum: State business experts say economy on the rise (The State Journal)

CHARLESTON — Several state business leaders and academics agree that the Mountain State’s economy is starting to rebound following years of decline.

“The economy of West Virginia is definitely in recovery,” said Steve Roberts, president of the West Virginia Chamber of Commerce.

In two years, Chamber of Commerce officials said, West Virginia has experienced a 3.5 percent increase in state revenue, seen the 11th highest wage growth in the nation since the Great Recession, witnessed the eighth highest GDP growth in 2017, seen a 6.4 percent increase in personal income tax collections and a 25 percent increase in severance tax collections, added 2,700 mining jobs and 4,100 new construction jobs and seen a 21.7 percent increase in natural gas marketed production.

But can recent growth be sustained? Will the state be able to diversify its economy beyond the extraction industry? And can continued growth be expected in the future?

“The economy is growing, but it’s unbalanced,” said longtime Charleston real estate mogul and businessman Brooks McCabe. “Clearly North Central West Virginia and the Eastern Panhandle are doing well.

“Once you get into the more rural areas, you’re seeing an uptick in tourism, and (growth) is more modest.”

But from the Huntington-Charleston corridor down into the southern part of the state, McCabe said, the economy remains sluggish and times remain troubled.

Economist John Deskins, director of the Bureau of Business and Economic Research for West Virginia University, agrees.

WVU’s annual economic preview, “West Virginia Economic Outlook, 2019-2023,” will be released in October.

The report, which tracks the state’s economy and predicts what the Mountain State might expect to happen in the future, is likely to reflect the kind of varied economic situations referred to by McCabe.

Deskins said much of West Virginia’s growth is centered in about half a dozen counties, including North Central West Virginia and the Eastern Panhandle.

But while job growth is strong in those counties, most counties in the state are still losing jobs or treading water, Deskins suggested.

“It’s not like all 55 counties are moving in the right direction,” he said.

Deskins said coal production in the Mountain State rose from about 82 million tons a couple of years ago to about 93 million tons.

That growth helped jump-start a lagging economy, but, Deskins said, “We’re not going to have that again next year, and we’re not going to have that in coming years.”

Deskins said he expects the state’s coal industry to stabilize over the next few years, but he doesn’t expect to see the industry rise to pre-recession levels.

Both Deskins and McCabe agree that West Virginia’s economy remains built largely on extraction industries like coal and natural gas, and that the state needs to diversify.

If the state wants to truly grow its economy, McCabe said, there needs to be growth in knowledge-based jobs like computer technology and the aerospace industry and high-end manufacturing, which McCabe believes will come from a fledgling petrochemical industry tied to the byproducts of natural gas.

State leaders need to recruit new employees to come to West Virginia and retain more college graduates, he said.

“There’s no question in my mind that’s going to happen,” McCabe said. “But how quick?”

McCabe and Deskins agrees the Mountain State still faces major challenges with the worst workforce participation rate in the nation, per capita incomes that lag behind the rest of the nation and diversifying the economy. In addition, McCabe said, cities have to figure out how to deal with an increasing homeless population at the same time able-bodied people are leaving the state, the need to provide public health services and the fallout from the opioid crisis, which has hit West Virginia harder than the rest of the country.

“That all has to be figured out within the next year or 18 months,” McCabe said.

West Virginia also continues to struggle with higher-than-average unemployment rates.

According to the most recent data published by Workforce West Virginia, which contains information through the month of May, the state’s unemployment rate has remained steady while the national rate has seen substantial drops.

Since mid-2017, and despite job growth in some counties, Workforce West Virginia reports West Virginia’s unemployment rate has risen from 5.0 percent in June 2017 to 5.4 percent, where it has remained since October. During that same time period, national unemployment rates dropped from a high of 4.4 percent in August 2017 to 3.9 percent in April.

“The balance of 2018 and 2019 will be difficult years,” McCabe predicted. “We’re in that period of changing the trajectory (from decline to growth). That’s hard work.

“It is turning around, but it takes time,” he said.

“I’d say we’ve hit bottom,” McCabe said of the Mountain State’s economy. “We’re trying to work our way back up. The worst is behind us, but the (economic) damage has been done.”

“I think we’ll have an (ethane) cracker under construction within two years,” McCabe said. Even if the ethane cracker is located in neighboring Ohio or Pennsylvania, “It will mean West Virginia jobs,” he said.

McCabe and Deskins also agree that now is not the time for business and government leaders to merely sit back and congratulate themselves for an improving economy.

“We shouldn’t lose our sense of urgency because we have some good data,” Deskins said.

“We need to act more and debate less,” McCabe said. “We need to move faster.”

Staff Writer Rusty Marks can be reached at 304-415-1480 or email at

West Virginia Chamber Pillars for Progress

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Competitive Business Climate

A better jobs climate will lead to more employment opportunities for our state's workers.

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Infrastructure & Economic Development

A robust economy is built on a solid infrastructure.  Transportation is vital to move people and products to larger economic markets.  Air service, connectivity, maintenance and construction of roadways, and the continuance of the state's water and sewer enhancement program are key.

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Education & Workforce Development

West Virginia employers need an educated workforce.  Schools must be effective, accountable and responsive and produce a competitive, healthy, and world-class workforce.

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Good Government & Quality of Life

Every West Virginian should have the opportunity for a life that includes a healthy environment, a quality education, a good-paying job and an efficient government.

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