Good news trickles down
There is no way to be certain the economy has truly turned a corner. It will be impossible to gauge the success of any of the economic stimuli, job creation legislation, reinvestments or other Holy Grails of economic turnaround medicine until months or years from now.
But the recent news that new home construction in the Suffolk area showed an 83 percent increase over the previous time last year is an exciting indication of where things are headed.
Any economist will tell you new home construction is a crucial indicator of an economy’s health and well being.
The money invested in new homes trickles down through the economy to contractors, sub-contractors, vendors, specialists, landscapers and so on. One dollar invested in a new home has a way of touching six, seven, eight or more people as it works its way through the economy.
While the news of new home starts is encouraging it remains to be seen if the glimmer of hope these statistics show will lead to lower unemployment, higher individual earnings and better earnings for local businesses.
The Hampton Roads region, and Suffolk in particular, is blessed to have the significant impact of the military influences on our economy. The addition of such key employers as Boeing, Northrop Grumman, Lockheed Martin and U.S. Joint Forces Command has led to growth of other quality of life retailers and businesses throughout Suffolk, helping insulate this area from the recent economic downturn.
Suffolk also has worked hard to provide a fertile environment for many types of industry and businesses, leading to a well-diversified tax base. That helps keep an area or city from being vulnerable to the economic fortunes or misfortunes of one economy.
The recent reports on new home construction are great news for area contractors and vendors, but they are even better news for our community at large.