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Ferguson: Then and Now

TOP ROW: On Nov. 24, 2014, a protestor poses for a "hands up" photo in front of a burning building that housed several business including a civic program called, "Heal STL," on West Florissant Avenue. On July 31, 2015, taking part in activities, young marchers walk past the empty lot on Friday, July 31, 2105. BOTTOM ROW: On Nov. 24, 2014, firefighters fight a fire at AutoBuyCredit used car lot on West Florissant Avenue after a grand jury did not indict Ferguson police officer Darren Wilson in the shooting death of Michael Brown. On July 31, 2015, another selection of cars are offered for sale. Photos by Christian Gooden, cgooden@post-dispatch.com

More than eight months after the last big outbreak of destruction in Ferguson and Dellwood, it’s hard to detect an impact on the St. Louis economy much beyond the immediate riot zones.

An economic Ferguson effect is not obvious in the data now available on jobs, tourism, real estate sales for the broad metro area or in comments from people who monitor the region’s business.

It’s early, however, and local officials may never hear about opportunities missed due to images of anger, protest and arson broadcast worldwide.

And the aftermath is still felt in parts of Ferguson and Dellwood, where vacant lots mark the spots where buildings burned, and surviving businesses there are struggling to get their customers back.

Last year’s unrest began after the fatal shooting of Michael Brown by Ferguson police Officer Darren Wilson. Protests turned into burning and looting on Aug. 10, and again on Nov. 24.

The violence grabbed headlines and focused the nation’s attention on St. Louis, but around the metro area employers kept hiring after the trouble.

From January through June of this year, St. Louis added 10,500 jobs, according to the Bureau of Labor Statistics. That’s more than the 6,500 jobs gained in the same period in 2014, before the protests. The 0.8-percent job growth here in the first six months of 2015 was close to the 0.9-percent job growth for the nation.

The St. Louis unemployment rate slid to 5.4 percent in June from 6.3 percent a year earlier.

The real estate market actually improved following the riots in most parts of metro St. Louis. Home sales in the region were up 12.8 percent in the first half of this year compared with a year earlier, according to figures from the St. Louis Association of Realtors. That mirrors a national trend toward recovering sales and prices after a weak year in 2014.

Home sales were up only 2 percent in north St. Louis County, but that market was trailing the rest of the region even before the trouble. In Ferguson itself, 15 homes sold in the first half of this year, down from 18 a year earlier.

Tourists shrugged off last year’s troubles, according to the St. Louis Convention and Visitors Commission.

‘IT COULD HAPPEN ANYWHERE’

In January, just weeks after the violence, the CVC held six focus groups made up of dozens of leisure travelers in Chicago, Indianapolis and Memphis. The moderators asked about St. Louis.Commission officials loved what they didn’t hear. “In no part of any of six focus groups did any respondent even bring up Ferguson,” said Brian Hall, the commission’s chief marketing officer.When asked about the trouble, they said things such as “It could happen anywhere.” They weren’t afraid to visit St. Louis.

“We were surprised,” Hall said. “We thought the effect would be more pronounced.”

The tourist business, they decided, was safe.

The commission measures tourist potential in part by visits to its Explore St. Louis website. Web visitors dropped 9 percent during the unrest but have since rebounded to levels above last year.

Visitors are still coming. Hotel occupancy stood at 64.3 percent for the first half of this year, compared with 63.5 percent in the first six months of last year, according to the CVC.

Meanwhile, riots in Baltimore, mass murder in Charleston, S.C., and racially tinged police shootings in several cities have made Ferguson less a story about St. Louis and more one about nationwide problems.

PNC Bank economists didn’t even mention the troubles in an upbeat forecast for the St. Louis economy released last week. They predicted unemployment falling to 5 percent over the next year while incomes improve.

Still, Hall is worried. The CVC gathered groups of meeting planners and association executives in Washington and Chicago in February. These people could bring conventioneers by the thousands to St. Louis. “One in four said they would take a wait-and-see attitude about the way we deal with the social challenge before they would consider booking in St. Louis,” Hall said.

They mentioned the “social values” of their groups and “what it would say about them if they booked in St. Louis,” Hall said.

Indeed, advance meeting and convention bookings for future years are down a bit. They booked 576,000 room nights in the fiscal year that ended last month, down from 625,000 the year before. But that year had set a record, and Hall was reluctant to blame the drop on Ferguson.

MAJOR CONVENTION RETURNS

Still, St. Louis held on to the one convention most obviously at risk.The Church of God in Christ, a largely black congregation based in Memphis, brings 28,000 people to St. Louis for its annual convention. When Ferguson erupted, COGIC was deciding where to hold its meetings for 2017 through 2019. Presiding Bishop Charles Blake Sr. wrote Gov. Jay Nixon urging justice in the Michael Brown shooting and “systemic changes.”COGIC signed on last month for another three years in St. Louis. “Ferguson and the St. Louis metropolitan area have made great strides over the past year,” Blake said in an email.

St. Louis led national news reports day after day during the protests in August and November, with images of tear gas, flames, looting, tear gas and riot police pointing rifles at people. That raised concern that the unrest might cast a chill on the region’s economy, making business reluctant to expand here and outsiders reluctant to come.

Some of that damage may be happening — it’s hard to parse the effects of Ferguson from everything else influencing the region’s business.

Economist Howard Wall, who studies the regional economy from Lindenwood University, thinks the negative effects will be marginal.

“It will be one or two conventions a year,” he said, meaning a little less life at America’s Center than might otherwise have been.

The region may find it a little harder to attract companies relocating from elsewhere, he said, but that’s a small factor in regional growth. The region’s real strength comes from businesses already here that grow bigger, and from new enterprises that start here. Ferguson will have little effect on that, he said.

Sheila Sweeney’s job is to convince executives from elsewhere to place jobs in St. Louis. She is interim CEO at the St. Louis Economic Development Partnership, a joint city-county agency.

“Our pipeline has stayed full. We’ve not noticed that we’ve lost anyone,” said Sweeney. In fact, the region’s biggest economic coup came amidst the protests, as Boeing announced a decision to build part of its 777X airliner in St. Louis, expanding its North County plant and adding 700 jobs.

Out-of-town prospects ask her about Ferguson, says Sweeney, but it’s not a big deal for them. “Nobody said, ‘Don’t take us there,’ ” she said.

Of course, Sweeney wouldn’t necessarily know if a company had shunned St. Louis. Local officials often don’t hear of prospects until their town gets on a company’s short list.

‘DID NOT SEND A GOOD MESSAGE’

James Renzas makes such short lists. He is a principal in the RSH Group, a site selection consulting group based near Los Angeles.The Ferguson troubles will indeed work against St. Louis, he said. Racial violence has a particularly bad effect on the ability to attract tech firms, who hire highly trained people, many from overseas, Renzas said.“Technology companies are into diversity and tolerance, and that did not send a good message,” he said.

Companies in other industries may worry less about such things, he said, noting that St. Louis has other attractions. “It has a reputation as a reasonably good place in the Midwest to look,” he said.

A good airport, central location, low cost of living and good universities give St. Louis a leg up, said Renzas, who specializes in technology companies. But we lack the “coolness” factor that tech companies find in Boston or Austin, Texas.

Bob Bishop is a headhunter, otherwise known as an executive recruiter. He finds people to fill marketing and advertising jobs at the director level and above.

Do prospects from out of town ask about last year’s troubles?

“Surprisingly, no,” said Bishop, who is based in Clayton.

“I was worried about it last year,” he said. But then deadly incidents elsewhere reminded people that St. Louis isn’t the only place with race, poverty and policing issues.

“Maybe it’s the nature of today — such fast news cycles and so many things to focus on,” he said. “No candidate ever asked me about Ferguson.”

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