Some things about the economy are actually better in Kentucky, but as usual, it’s a good news-bad news scenario.
Two university economics professors told the General Assembly’s Banking and Insurance Committee Tuesday that Kentucky banks are sounder than many across the nation and there are fewer families losing their homes.
Dr. Paul Coomes of the University of Louisville said housing markets in Louisville, Cincinnati and Lexington are steady.
”So, don’t worry. Your home is not falling in value,” Coomes said. “It may take a little longer to sell it, but the value is not falling. (Kentucky) did not have the housing bubble and we do not have the burst.”
He said there were 3,700 foreclosures in Jefferson County last year, sharply up from average years. But that’s misleading.
“It sounds like a lot, but it’s a mistake to think 3,700 families have been forced out of their homes,” Coomes said. “A lot of those are investment properties, not single-families driven from their homes.” He said between half and 70 percent of the foreclosures involve investors in multiple properties.
Coomes said much of the nation’s economic woes are tied to a housing boom which encouraged far too many who had too few resources to purchase homes. Kentucky is seeing only about half the number of new homes under construction it saw three years ago.
But, Coomes said, Kentucky has seen slow job growth over the past seven years, increasing new jobs by only 2 percent since 2001. “We used to add 2 percent a year.” Since 2000, Kentucky has lost 55,000 manufacturing jobs. Surprisingly, he said, Kentucky is not adding retail jobs, mostly because of automation, self-service and plastic transactions done by the customer. The same is true in service industries like travel and hotels.
Kentucky’s adjusted unemployment rate for October is 6.8 percent.
Most job growth has occurred in health care. “We’re relatively unhealthy and we’re relatively old,” in Kentucky, Coomes said. Other areas of job growth have been in government at all levels: state, county, municipal, education and in business technical services. The last represent relatively good, well-paying jobs.
And University of Kentucky economist Dr. Donald Mullineaux said Kentucky’s banks are relatively healthy, because most are community banks which “have been extremely prudent in their lending practices.” Unlike many banks across the nation, most Kentucky banks didn’t enter the sub-prime housing market or exotic mortgage packages.
In fact, Mullineaux said, Kentucky’s banking system ranks 11th out 52 (the 50 states plus the District of Columbia and Puerto Rico).
“Kentucky banks are performing well, well above the national effort,” Mullineaux said. Nationally, banks have been plagued by poor management, unreasonable risk taking and inadequate government controls.
Both Mullineaux and Coomes think things may get worse before they improve.
“Week by week, I’m getting more pessimistic,” said Coomes, who went on to say he thinks the recession will be worse than the one in 2001 and maybe longer than the one in 1992, but, “I don’t think as bad as the one we had in 1980-1982.”
That may not be much comfort for those who lose homes through foreclosure or lose their jobs. But overall, the economy will recover.
“We’ll get through this. The sky is not falling,” Coomes said.
Ronnie Ellis writes for CNHI News Service and is based in Frankfort. He may be reached by e-mail at rellis@cnhi.com. The Richmond Register is a CNHI newspaper.
Local News
Kentucky banks in relatively good shape and so is home ownership
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Judge weighs constitutionality of legislative redistricting
Kentucky’s deadline for filing to run for legislative seats was in flux on Monday because a judge did not immediately rule on a lawsuit challenging the constitutionality of newly redrawn district boundaries.
Franklin County Circuit Judge Phillip Shepherd said he expects to enter a ruling in the case by mid-week.
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Couple recovering from injuries suffered in weekend house fire
A couple was hospitalized after their home was set ablaze Sunday by a spark from a cigar, according to a county fire official.
County Fire Chief Jim Cox said the city and county fire departments were called to the home at 111 Concord Road in the early afternoon. Waco Volunteer Fire Department and the Richmond Fire Department also responded.
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EKU closes dining room at Arlington Clubhouse
A Richmond country club is no longer offering dining to members, but remains available for catered events and will be open on certain holidays.
Arlington Country Club, which has been a staple of Eastern Kentucky University for the past 40 years, laid off all dining staff late last week, according to Tom Coffey of the EKU Foundation.
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Standoff at Super 8 Motel ends peacefully
A bizarre drug-fueled standoff at the Richmond Super 8 Motel ended peacefully with no one hurt, including a child who was in the room with a man that police found wielding two knives.
About 1:53 a.m. Friday, police received a call about a man who was threatening someone with a knife at the motel on North Keeneland Drive, according to Richmond Police Chief Larry Brock.
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Trial for couple accused of human trafficking delayed
The trial for a Berea couple accused of human trafficking involving their daughters has been delayed.
Despite Monday morning television reports that the trial was beginning Monday, it was postponed because the attorneys are not ready to try the case.
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Richmond man charged with child porn possession
(Editor’s note: The following story contains graphic information some readers may find offensive.)
A Richmond man has been arrested for possession of child pornography as a result of a nearly one-year investigation by local police.
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Noted author to deliver keynote address for Black History Month
Almost a year ago, Arnold Rampersad stood in the East Room of the White House as he was presented the National Humanities Medal by President Barack Obama.
On Thursday, Feb. 16, the noted author will stand in O’Donnell Hall of Eastern Kentucky University’s Student Success Building to deliver the keynote address for the university’s Black History Month observance. Rampersad’s visit is also part of Eastern’s year-long Chautauqua lecture series, and the title of his talk, “Black History: The Challenge of Living with Others,” coincides with this year’s Chautauqua theme, “Living with Others: Challenges and Promises.” -
Habitat for Humanity
Habitat for Humanity of Madison and Clark Counties, which has built 160 homes for people in need since 1992, is seeking applicants for partner families, according to Judy Flavell, executive director of the organization.
“We really need applicants right now,” Flavell said. “More people can qualify for Habitat homes than people realize.”
Eligible applicants must have lived in Madison or Clark counties for at least one year, have a stable income, be able to pay a modest monthly mortgage and be able to demonstrate that their current housing is overcrowded, physically substandard, too expensive, unsafe, or they are living in subsidized housing, according to Habitat.
For more information about eligibility, or to apply, call Habitat for Humanity at 625-9208 or visit its office at 1417 East Main Street in Richmond. Visit online at habitatmadisonclark.org. -
Occupational therapy dept. at EKU offers program for adults with memory loss
For local adults who are experiencing memory loss related to dementia or Alzheimer’s, the Department of Occupational Therapy at Eastern Kentucky University has provided “The Place to Be” for the past two decades.
The department will again sponsor the free eight-week program on Thursdays and Fridays, 10 a.m.-2 p.m., beginning Feb. 9. Participants can attend Thursday and/or Friday. Applications still are being accepted (call 893-0653) for the free service, which is offered in Room 100 of the Dizney Building on EKU’s campus. -
Bible Belt towns in state consider going ‘wet’
In this Appalachian college town where socially conservative views are bedrocks of life, some people want to do what was once unthinkable: legalize liquor sales.
Supporters say passing the measure in Tuesday’s special election in Barbourville would tap a new revenue source in a place where hundreds of jobs are evaporating as one plant shuts down and another cuts its workforce in half. But from the pulpits to the courthouse square, opponents have been pressing their case that uncorking liquor sales would irreparably harm the town of about 3,200. - More Local News Headlines
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