PITTSBURG, Kan. — As local data begins to become available for the past few months, a clearer picture of the economic impact of COVID-19 is emerging.
In March, the local unemployment rate was at a 20-year low of 3.3 percent, Pittsburg Director of Economic Development Blake Benson noted at the city commission meeting on Tuesday.
“And virtually overnight it spiked to 9 percent,” he said, “and to put it in perspective, 9 percent is right around where we were in 2008 when we lost our largest private employer in Superior Industries and we were facing the Great Recession, so we know what kind of territory that we’re in.”
Benson noted, however, that the local economy is still doing better than the US overall, which had a 14.7 percent unemployment rate for April, and some are expecting that number could rise to 20 percent or more when the May numbers are released.
The hotel occupancy rate is another important indicator of the coronavirus pandemic’s effect, Benson said, as visitor spending and tourism has been an increasingly important part of the local economy in recent years.
“Those visitors spend a lot of money in our community,” Benson said.
Crawford County Convention and Visitors Bureau data show that the hotel occupancy was 44.6 percent in February, but dropped to 25.3 percent by April.
Benson said he didn’t “necessarily want to paint a doom and gloom scenario,” but as more information becomes available, it is becoming evident that the coronavirus crisis has had a significant economic impact locally.
Later in the meeting, and also in a city update video released Wednesday, Pittsburg City Manager Daron Hall discussed the impact of the pandemic on the city’s finances.
“About a month ago we sat down with a team, all the financial people and the experts that know how to save money and cost cut, and just said ‘What is our financial impact?’” Hall said in the video. The city is currently estimating the pandemic’s impact at just under $2.5 million, he said.
While the city has to find ways to cut expenses to make up for that loss, preventing city employee layoffs is a major priority, Hall said. The city has frozen hiring for vacant positions, and city employees will not be getting raises that were scheduled for 2020.
City Commissioner Patrick O’Bryan said at Tuesday’s meeting that he had heard that in Los Angeles, city employees were having to take a 10 percent pay cut, and the fact that City of Pittsburg employees weren’t having to do that “speaks well to how we manage our business.”
Hall said, however, that “there is a list with that number on it, and it’s 5 percent pay cut and it creates a significant amount of money, so we have a list and we’re prepared to go down it as much as we need to, but yes it’s great that we’re looking right now like that’s not going to be needed, and we’re just going to buckle down and get through this with everybody else.”
Decisions to keep the Pittsburg Aquatic Center closed for the summer and to cancel the city’s 4th of July fireworks display also had to do with financial considerations, Hall said.
“We are going to allow for the sale of fireworks in the community,” he said. “We’re still going to have the same number of days and hours for people to shoot them off. We encourage you to enjoy the 4th of July, and believe me, we’re very disappointed that we won’t be able to bring it all together on Saturday night at the park.”