“We at the Hampton Roads Chamber are educating and enlightening business leaders which is the purpose of today’s event and LEAD Hampton Roads,” began Bryan K. Stephens, President and CEO, Hampton Roads Chamber, during the 2019 State of the Region Address.
On Tuesday, October 1, 2019, the 20th Annual State of the Region took place on the Southside at the Norfolk Waterside Marriott Hotel. The State of the Region Address is presented each year by LEAD Hampton Roads, a program of the Hampton Roads Chamber, to inform business leaders of the economic outlook and forecast for the year ahead. Salient topics focused on the regional economy, defense spending, tourism, women’s leadership, the economic effects of a hurricane, and marijuana usage in Hampton Roads.
Dr. James Koch, Board of Visitors Professor of Economics Emeritus and President Emeritus; and Founding Director of the Dragas Center for Economic Analysis and Policy at Old Dominion University, delivered a brief history of the State of the Region, which began 20 years ago in 1999. Dr. Koch spoke highly of the late George Dragas, Jr., who was instrumental in the creation of the State of the Region report.
Dr. Koch said that the report tends to forecast trends for the future. “If you want to know what the Virginian Pilot or the Daily Press will be reporting next year, then read this year’s State of the Region report,” said Koch. He ended by thanking the Dragas family for their generosity and the Dragas Center for Economic Analysis and Policy for producing the report each year.
“How are we doing? That’s always the question of the State of the Region report,” began Dr. Robert McNab, Professor of Economics; Director of the Dragas Center for Economic Analysis and Policy, Old Dominion University, Strome College of Business. McNab said there was good news for Hampton Roads since the economy is expected to grow by 2.4% in 2019, the third year of consecutive growth for the region. Employment has also grown at a record high in Hampton Roads, 2% higher than in 2017, with more than 822,000 individuals employed.
“There is progress being made after a long and slow economic recovery, following the Great Recession,” stated McNab. The overall sentiment was positive for the local economy. “The Hampton Roads economy is in a better position today than it was last year, and a better position today than it was two years ago.”
Regarding military and defense spending, the military constitutes a large portion of economic activity in Hampton Roads. In 2018, it was estimated that 21 billion dollars were spent on defense and that spending is expected to exceed 22 billion dollars in 2019. “Roughly 40% of economic activity in Hampton Roads is touched in some way by the Department of Defense,” said McNab.
Tourism was evaluated next, concentrated on the Something in the Water festival in April 2019. “Something in the Water was successful from a lodging standpoint,” stated McNab. The music festival took place on the Virginia Beach Oceanfront, but drove tourism and increased hotel revenue throughout the entire Hampton Roads region.
McNab went on to describe Something in the Water as more than just a music festival but said it was “big business” or a “regional event” that injected new dollars into the economy. He compared the festival to Austin, TX’s annual South by Southwest (SXSW) conference, and argued that the success of Something in the Water could result in an annual festival to grow the economy of Hampton Roads. “This is an opportunity for us to work together to improve our regional branding, that will grow organically, rather attempting to just force something on the region that no one likes.”
Dr. Barbara Blake, CAO, Dragas Center for Economic Analysis and Policy, Old Dominion University, was the first woman to present a keynote at the State of the Region Address. Blake focused on the gender wage gap and lack of leadership positions for women in Hampton Roads.
“Even though we as women are half of the population, only 18 to 20% of women are in the C-suite,” said Blake. She presented a figure from Blau and Kahn, which found that women earn 92% of male counterpart earnings, and urged the audience to acknowledge the wage and leadership gap in Hampton Roads. “Something has to be done,” Blake said. “Women are in the pipeline but why can’t they make it to the top?”
Blake encouraged the audience to be intentional in their commitment to diversity and inclusion practices in the workplace for women. “Acknowledging the wage and leadership gap will move us forward to overcome these gaps,” ended Blake.
McNab returned to discuss the economic impact of a hurricane on Hampton Roads. Although the region has not been struck by a Category 3 hurricane in more than 150 years, the physical and economic damages would be disastrous to Hampton Roads. “The physical damage, along with wind and water damage would result in more than $40 billion lost and 16,000 people displaced,” said McNab.
In closing, McNab went over “420 in the 757,” addressing possible outcomes for Hampton Roads if marijuana were legalized in Virginia. “More than 50% of Virginians in recent surveys supported the legalization of marijuana, the Code of Virginia is quite clear: possession of marijuana is illegal in almost every circumstance,” said McNab.
While Hampton Roads has the highest marijuana use recorded among young adults in the Commonwealth, the substance is still illegal in Virginia and warrants law enforcement action. McNab discussed the possibility of decriminalization, which could reduce the number of arrests but may still have negative effects as a civil charge on people who are caught with marijuana.
Comparatively, if marijuana were legalized, it could reduce the number of possession charges but could potentially increase traffic accidents and emergency department visits. McNab also voiced the concern for Hampton Roads of how decriminalization or legalization would affect the number of military service members and federal employees in the region who are regularly tested for drug use.
“So that’s the large question that I will leave you with today,” ended McNab. “Our job is to report the data, have fun with the report.”
Despite the challenges facing the region, there is optimism and opportunity for Hampton Roads as the region continues to grow. The State of the Region Address will take place again on Friday, October 4 on the Peninsula at the Newport News Marriott.
Thank you to the following sponsors: Optima Health (Presenting Sponsor); Bon Secours (Platinum Sponsor); Damuth Trane (Gold Sponsor); BB&T, Old Point National Bank, and The Port of Virginia (Silver Sponsors); Old Dominion University, On Point Communications, and Lori By Design, LLC (Bronze Sponsors).