Mohave County Economic Development Letter from the Director

Published by The Bee News

March 1, 2022

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As we end the first quarter of 2022, we see many changes to the economy.  One key concern with most people I talk to is the question of “what is happening with inflation”.   In the last couple of years, we have seen housing prices soar, gas prices rise, empty shelves in the stores and “Help Wanted” signs everywhere.  According to the US Inflation Calculator the US has seen a drastic rise in inflation this past year. January 2021 started out low at 1.4% and continued month-over-month to rise until in December 2021 with the inflation rate at 7.0%

A strong economy is demonstrated when supply and demand are close.  A healthy economy is determined with 1.5% to 3% inflation growth.    When consumers see prices rise, they purchase consumer goods before the price goes up.  This creates an imbalance with supply and demand ultimately spiking inflation.   If inflation is low, consumers tend to hold on to their cash.  Consumers wait for prices to drop before buying, especially for larger purchases including homes and/or purchasing a business.  This is a time when companies lose sales and might even sell their company or close their doors.

Since 1929, inflation rates were higher in only 11 years above 2021.  The chart below shows the different years of inflation.  The smaller chart shows annual inflation rates from 2012 to January 2022.

Year Inflation Rate YOY Events Affecting Inflation
1942 10.9% Pearl Harbor and Defense Spending
1946 8.3% Budget Cuts
1947 14.4% Cold War Spending
1948 8.1% Defense Spending
1974 11.0% Watergate
1975 9.1% Continued from Watergate
1978 7.6% Energy and Home Ownership Prices Rose
1979 11.3% Energy and Home Ownership Prices Rose
1980 13.5% Recession
1981 10.3% Reagan Tax Cuts
2021 4.7% Forecasted (Pandemic)

 

One of the strengths Mohave County can boast is its business diversification.  As prices rise, we have different industries that will carry the economy.  Within the county, several organizations are partnering to create training programs that will increase wages to a livable wage, even during a spike in the economy.  Just as every other community, we are seeing prices continue to rise at the grocery stores, gas tanks, housing, and every other commodity.  We also see people stepping up to help others including companies.  People are learning new trades that have been lacking. People are learning to do things for themselves instead of hiring it out.  People are looking for ways to hire and buy local and are starting to barter.   According to the US Census, Mohave County is also projected to continue to grow by 33% the next few years.

With new business and population migration in the county, new money is flowing.  We still will need to pay more money for gas and other commodities coming from outside the county and state.  Businesses have raised prices to support the new $12.80 per hour minimum wage, but our companies are paying more to hire and retain employees.  We have training programs in place and are creating additional programs to support higher paying jobs.  My office is working with companies to bring in “at home” jobs, and we are working with entrepreneurs and local businesses to help them grow.

One of the causes for the Great Depression was the lack of foreign trade.  Businesses grew rapidly during the early and mid-1940’s.  By late 1940’s businesses were doing well, and money was used to start investing again in foreign countries.  Today, as we see rising concerns with international trade, it is proof we need to produce and manufacture more on US soil and specifically, in Mohave County.  There are so many opportunities to bring to our county.  If you have an idea for a new company, or if your business needs support to grow or your business has concerns and challenges, please contact my office for ideas and resources.

Let’s all work together to make Mohave County strong during this delicate time.

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