2010 Economic Outlook
Morgantown Metropolitan Area

Version 06/10
By Donald Reinke, AICP, CEcD
Director, Monongalia County Development Authority
President, Morgantown Area Economic Partnership

In spite of current recessionary forces at the global, national and state levels, the economy of the Morgantown Metropolitan Statistical Area (MSA) will fare much better than any other regional economy in the State during the next year. This is largely because the economy of the MSA (including both Monongalia and Preston Counties) is heavily weighted toward employment sectors, such as government (especially state government jobs at West Virginia University), education and health care that are relatively resistant to state/national, and global recessionary forces. Employment and income growth have surged in the Morgantown MSA during the last two decades and its unemployment rates have remained relatively low, even during the "Great Recession."

The Morgantown MSA Economic Outlook 2010, published by the WVU Bureau of Business and Economic Research in March 2010, states that the Morgantown MSA continues to be a force for growth in West Virginia, adding jobs at a rate that far outpaces the state and nation. The Outlook noted that "Morgantown's job growth was just 0.7 percent in 2009, compared to 2.2 percent growth in 2008. However, Morgantown's growth beat the severe job losses for the state (-2.6) and the nation (-4.3 percent)." The forecast for the Morgantown MSA calls for stronger job growth in 2010, as the national economy gradually rebounds. The Outlook calls for most of the net job gains to be in service providing sectors like health care; government; professional and business services; leisure and hospitality; and trade, transportation, and utilities. The region is also expected to post modest job gains in the goods-producing sectors like construction and manufacturing. The complete Morgantown MSA Outlook report is available for review at the WVU-BBER web site (www.bber.wvu).

As a result of this relatively bullish economic condition in the Morgantown MSA, in recent months it was named as one of the "Best Small Places for Business and Careers" by Forbes, one of the "Best Metros for Jobs" by careerbuilder.com., and one of the "Best Small Places to Launch a Small Business" by Fortune.

However, it must be noted that no local economy operates in a vacuum, free from state, national, and /or global economic influences. As was noted above, job growth in the Morgantown area in 2009 was at a lower rate than recent years, although still much higher than state or national rates. The metro's average unemployment rate has increased significantly in 2009, although still the lowest in the State.

Let's take a closer look at the specific employment sectors that comprise total non-farm payroll employment in the Morgantown MSA. In 2009, the most recent year for which complete data is available from Workforce WV, the total nonfarm employment in the Morgantown MSA numbered 63,000 workers. This reflected a small increase from the previous year. Non-farm payroll employment is comprised of three goods-producing employment sectors -- Natural Resources and Mining (820 workers), Construction (2,860), and Manufacturing (3,780); and it is comprised of eight service-producing sectors - Trade, Transportation and Utilities (8,850); Information (650), Financial Activities (1,620)), Professional and Business Services (4,900), Education and Health Services (12,600), Leisure and Hospitality (6,300), Other Services (3,020), Federal Government (1,900), State Government (11,400), and Local Government (4,300).

The employment sectors in which the MSA has a regional "specialization" (i.e., a higher percentage of total employment locally vs. nationally) include Education and Health Services, Federal and State Government (particularly State Government because of WVU), Other Services, and Natural Resources and Mining. It should be noted that there is a very large number of highly-skilled and well-paying Government and Health Service jobs in the MSA. Obviously, the presence of West Virginia University, two large health care systems, a number of state and federal government research facilities, two Federal Bureau of Prisons correctional facilities, and the Camp Dawson military base contribute greatly to the regional specialization in these types of jobs.

A high level of construction activity will continue during the year for a wide variety of private, public, and institutional projects. Some of the larger commercial, industrial, institutional, and government projects that are either underway or proposed to break ground during the year include the following:

Monongalia County:

• Longview Power Plant ($1.8 billion - 695 MW Power Plant)
• Projects at West Virginia University including White Hall Renovation ($33 million), Basketball Practice Facility ($21 million), Agricultural Science Greenhouses ($5 million), an Art Museum (renovation of former Alumni Building), and various other facility construction and renovation projects.
• New $12 million Pediatric Research Institute at WVU Children’s Hospital
• New National Guard Readiness Center ($23 million)
• Development of a Mylan Pharmaceuticals facility at Mountaineer Mall ($5 + million)
• Construction of a new access road ($4 million) to serve the proposed Morgantown Airport Business Park and the proposed Army National Guard Readiness Center
• Infrastructure improvements ($14 million) in Morgantown Industrial Park
• Construction of a new Wharf District Event Center ($22 million – 80,000 SF) including a new WV Public Theater/Exhibition Center and parking garage ($5 million, 350 space) in the Wharf District
• Mon-Fayette Expressway - Cheat Lake Intersection ($12.8 million)
• MUB’s expansion of the Star City Wastewater Treatment Plant and utility line upgrade along Caperton Trail.
• Continued build-out at Suncrest Towne Centre ($50 million commercial center), including a Medical/Corporate Professional Building.
• Continued build-out at Pierpont Landing ($10 million commercial center)
• Continued build-out at University Town Centre project (100 + acre commercial center)
• Mon Health Medical Office Park (Three four-story buildings of 40,000 SF each)
• Mon General Tax Increment Financing District access road and infrastructure improvements ($5 million)
• Beech View Place mixed-use development on Beechurst Avenue ($30 million).
• New National Energy Technology Laboratories Building ($28.5 million)
• Platinum Properties Cheat Lake Development (Commercial/Residential)
• Mountaineer Place Apartments at corner of University Ave. and Stewart Street ($3.5 million)
• Numerous other smaller apartment and commercial developments

Preston County:

• U.S. Bureau of Prisons facility in Hazelton will add a new 1,100 bed men’s medium security prison, which will comprise the fourth prison within the Hazelton facility. At build-out the 1000 acre Hazelton facility will house 2,500 inmates and employ 700 workers ($166 million).
• Additional federal defense investment in Camp Dawson will enhance and increase that facility’s role as a national anti-terrorism center including an expansion to the Robert C. Byrd Building ($70 million), a new Challenge Academy facility ($12.9 million), an expansion to the Reserve Center ($8 million), and other improvements ($22.4 million).
• FMW Composite Systems has purchased the shell building at the Northpointe Business Park
• GNH Trucking at Northpointe Business Park ($1.8 million – 12,000 SF building)
• Commercial development near the Kingwood Wal-Mart
• Commercial development in Pointe Plaza
• Big Bear Lake Water Park ($2 million)
• James Preston Place ( Phase 1 - 30 condominiums, $4 million)
• Abandoned Mine Lands water projects exceed $20 million
• Kingwood sewer extension ($11.4 million) and water upgrades ($4.1 million)
• Water projects in Tunnelton ($1.9 million) and Rowlesburg ($1 million)

The economy of the Morgantown MSA has grown significantly in recent years and it is better positioned for growth than any regional economy in the state. Four basic indicators of the economic health of an area include population growth, employment growth, unemployment rate, and income growth. The Morgantown MSA ranks good to excellent on each of these four indicators of economic health, particularly relative to the rest of the state.

The Morgantown MSA enjoys a strong and diversified economy and it offers an excellent quality of life. It often receives national recognition for its many economic and lifestyle attributes . The question is frequently asked, "Why is the Morgantown MSA doing so well?" The primary reason is that Morgantown is home to West Virginia University (WVU) with an enrollment of 28,000 students and 8,000 faculty and staff. WVU is a large and recession-resistant economic engine for the area. The positive economic impact of having such a large flagship university in the community is further magnified by its recent efforts in regards to technology transfer and commercialization of the $100's of millions of dollars of research being conducted at the University, and the development of the WVU Research Park.

In addition to the presence of WVU, the community has other key attributes that have contributed to its success. The Morgantown MSA offers the best combination of labor, capital, education, commercialization of research, and quality of life in the State. These are all important factors in being able to attract and retain knowledge based employers and employees. Furthermore, there is a good, community-focused, cooperative working relationship that exists between local governments, WVU, non-profits, and the private sector. This relationship, combined with the many other attributes of the area, has fostered a climate of confidence and accomplishment which, in turn, encourages additional investment in the community by the private, public, and institutional sectors. This positive investment climate has produced some outstanding local civic leaders, entrepreneurs and developers, who are responsible for many of the construction projects outlined above.

In summary, the presence of West Virginia University; a skilled and educated labor force; a large health care industry; good public schools; outstanding recreational, cultural, and entertainment programs and facilities; and the continued growth of advanced technology industries and government installations along the Interstate 79 and Interstate 68 Corridors, help to insure a positive future for the area.

During the next year the Morgantown Area Economic Partnership (MAP), the Monongalia County Development Authority (MCDA), and the Preston County Economic Development Authority (PCEDA), will continue to promote and facilitate business retention, attraction, and incubation. The collective goal of MAP, the MCDA, the PCEDA, and their many public and private sector "partners," is to strengthen and expand the area's economy, and, in doing so, to help make the Morgantown Metropolitan Area one of the very best places to live and work in the country.

Footnotes:

1. In 2009, there were 12,610 Education and Health Services jobs, and 17,550 Government jobs in the Morgantown MSA. Both of these employment sectors paid a significantly higher average annual wage than either the average wage in the Morgantown MSA or the average wage in West Virginia.
2. The population of the Morgantown MSA grew by 9,137 people, or 8.2 percent, between 2000 (111,190) and 2009 (120,327). This rate of population growth is much higher than the state rate for the same time period (.7 percent), and comparable to the national rate. In the past year, Monongalia County was the fastest growing county in the state.

Due to population growth between 1990 and 2000, the U.S. Office of Management and Budget designated Monongalia and Preston Counties as the "Morgantown Metropolitan Statistical Area" in 2003.

Non-farm payroll employment in the Morgantown MSA surged by 26.8 percent or 13,300 workers between 2000 (49,700) and 2009 (63,000). This employment growth rate compares very favorably to comparable rates for WV (.82 percent) and the US (-.06 percent) for the same time period.

The Morgantown MSA consistently had the lowest unemployment rates for a metropolitan area in the State (Averaged 5.1 percent in 2009).

Per Capita Personal Income in the Morgantown MSA jumped by 50.5 percent or $11,125 between 2000 ($22,029) and 2007 ($33,154). This per capita personal income growth rate compares very favorably to comparable rates for WV and the U.S for the same time period. The 2007 per capita income for the Morgantown MSA is higher than the per capita income for WV ($28,206); however it is lower than the national average ($36,714). So even though the per capita income level for the Morgantown MSA is gaining on the national average, in absolute terms it still remains below the national average.

3. 2010: # 2 "Best Metros for Jobs" (careerbuilder.com)
   #10 "Best Small Metros for Business and Careers" (Forbes)

   2009: #8 Most Secure Small Place to Live (Farmers Insurance)

   #7 Best Small Place to Launch a Small Business (Fortune)

   #2 Top College Towns for Jobs” (Forbes).

   #3 Best Small Place for Business and Careers” (Forbes).

   http://www.forbes.com/lists/2009/5/bizplaces09 Morgantown-wv wvmor.html

   Morgantown featured in Wall Street Journal Spring 2009 article.

   http://online.wsj.com/article/SB123783142333116161.html

   "Best Small City for Business Startups" in West Virginia (Business Week)

   http://www.businessweek.com/smallbiz/content/mar2009/sb200903272.htm

   2008: #6 of "25 Best Cities to Find a Job" (Careerbuilder.com)

   One of six "Recession - proof economies" (JobBait.com).

   "Best Walking City in West Virginia," 34th Best in Country

   2007: "5th best Boomtown City in Country" (Inc)

   2006: "29th Smartest Place to Live in US" (Kiplinger's).
   "5th Best Place for Business and Careers -Metros less than 150,000 population" (Forbes).
   "12th Hottest Small City: Boomtown -Metros less than 150,000 population" (Inc).
   

   2005: One of best Sports Cities in America (Sporting News).

   2004: "3rd Best Small Town In America" (Men's Journal).
   
   2003: "City of Morgantown Awarded "Well Workplace Bronze Award” Wellness Councils of America

   2002: "Morgantown Graded "A" in Economic Development (BizJournals.com).

   2000: "Morgantown Selected #1 Dream Town in Country" (BizJournals.com).

   1999: "Best Small City In The East" and "3rd Best In America" (Guide to Life in America's Small Cities).

   Morgantown - Best Small City in the Country (BizJournals.com), one of the best Sport Cities in the Country (Sporting News). Morgantown MSA - One of the Best Small Metro Areas for Business and Careers (Forbes), An Inc. Magazine "Boom Town," A Kiplinger 50 Smart Place to Live, One of the Best "Quality of Life" and "Knowledge Worker" Metropolitan Areas in the Country (Expansion Management)

   (Version 6/10)