Local business leaders predict tempered economy for 2007

Monday, December 11, 2006

Will next year bring growth? Recession? The Southeast Missourian spoke with business leaders about 2007.

It's steady as she goes for the Cape Girardeau area, while the rest of the United States will see a slight slodown.

That's the conventional wisdom of some local community and busines leaders who broke out their crystal balls to make their annual predictions for what the economy will do in 2007.

"I think Cape's economy will do pretty well," said Bruce Domazlicky, director of Southeast Missouri State University's Center for Economic Research. "It doesn't have too many problems. But nationally, I see things slowing down."

National experts are predicting growth of the U.S. economy, the world's largest, to slow to 2.4 percent next year from 3.3 percent in 2006 and the 3.1 many predicted in May. The modified projections are largely based on a weakening housing market.

Cape Girardeau may see about a 1 to 2 percent increase in growth, Domazlicky predicted.

"Things probably won't be as good nationally in 2007 as this year," he said.

"But what we'll continue to find is that businesses will be in really good shape," he added.

Domazlicky sees the cooling housing market as cause for concern, though that will likely have less of an impact here, he said. He also doesn't believe the war in Iraq will be much of a factor to the economy.

Mitch Robinson, executive director of the Cape Girardeau Area Magnet industrial recruitment organization, said he sees steady progress for the area. He specifically pointed to Southeast Missouri State University's plans to transform about 400 acres of farmland into retail stores, commercial business, science and technology research operations and residential development in the next few years.

"That's going to be a focal point in the coming years," Robinson said. "When spring comes around, we're going to start seeing some dirt getting moved out there, and things are really going to get cranked up."

This year was a promising year, Robinson said, with the addition of National Asset Recovery System, or NARS, a call center that will open in Cape Girardeau and eventually create as many as 500 jobs, and Signature Packaging, a Georgia-based corrugated box manufacturer that announced plans to build a 80,000-square-foot plant in Jackson that will create 40 jobs.

"And we're making progress on a few other things," Robinson said.

Cape Girardeau Mayor Jay Knudtson -- also an area banker -- said 2007 will be a good time to live here.

"I'm not certain the rest of the country is going to experience the same kind of prosperity that the great city of Cape Girardeau is," Knudtson said. "But there's nothing we can do about that."

The next year promises to bring some exciting developments, Knudtson said, including the opening of the new federal courthouse and the grand opening of the new River Campus near the Bill Emerson Memorial Bridge.

"The long-term and the immediate future looks good," he said.

2007 also promises to be a year of much annexation into the city, he said.

"The city's growing at a good clip from an annexation standpoint," Knudtson said. "But we're not annexing idle ground. What we're going to be annexing is large tracts of ground that have major development occurring in and around those tracts."

Some examples include the new Interstate 55 La Salle Avenue interchange, near the university deal, and new subdivisions like Whispering Oaks.

But there are challenges that will come from that growth, Knudtson said. Annexation isn't going to be easy, he said.

"There are a number of residents in the outlying area that are perfectly content with their noncity status," Knudtson said. "We need to show them the value of being in our city. This will take us to the year 2020 and beyond."

Downtown Cape Girardeau will grow as well, said Marla Mills, executive director of Old Town Cape.

"I think Cape Girardeau's economy will see an upturn for the whole city and our district in particular," she said. "I think there's an optimistic atmosphere in our business community about things that are going on. There's an optimism that encourages development."


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