By RUSTY MARKS
The State Journal
CHARLESTON, W.Va. — The Mountain State’s economy is starting to bounce back, West Virginia University economist John Deskins said at the annual West Virginia Economic Outlook Conference Thursday at Embassy Suites in Charleston.
“I don’t have as much bad news this time,” Deskins said. “The good news is we finally hit bottom.”
Deskins said the Mountain State’s economy is finally starting to rebound after at least five straight years of decline. Of 26,000 jobs lost since 2012, West Virginia has regained about 4,500.
Deskins said coal production appears to have stabilized and will probably remain at about 90 million tons a year for the next several years. Production of coal had dropped from a high of 158 million tons in 2008 to about 80 million tons last year.
He also said natural gas prices are again rising as infrastructure to distribute gas catches up with massive Marcellus Shale gas production.
But Deskins said West Virginia’s gross domestic product has not really grown since 2012, while average wages in the state have dropped to about 75 percent of the national average.
With the lowest workplace participation rate in the nation, at 53 percent, “What we have is a desperate, desperate need for industrial diversification in our state,” he said.
Economists, academics and state officials believe the state’s untapped labor force is a major stumbling block to economic recovery.
Javier Reyes, dean of the WVU College of Business and Economics, said WVU, Marshall University and the state Department of Commerce teamed up to commission a study by McKinsey & Company to take a hard look at West Virginia’s economic challenges and come up with solutions.
Those plans are compiled under a program titled West Virginia Forward.
Reyes encouraged those at the conference to look at the program’s findings, which can be seen on the West Virginia Forward website, www.wvforward.wvu.edu.
Reyes said correcting West Virginia’s workforce deficiencies will be a big part in moving the state’s economy forward.
State officials do have some hope for optimism. Gov. Jim Justice, who made an unscheduled visit to the Thursday morning conference in Charleston, said he was convinced the administration of President Donald Trump intends to help West Virginia. Justice, at the conference to lobby for passage of his $1.6 billion road bond referendum, said he recently got a text message from U.S. Energy Secretary Rick Perry supporting plans for an ethane storage hub in central Appalachia.
State Commerce Secretary Woody Thrasher is working on the ethane hub idea, but also has plans to increase West Virginia’s tourism and timber industries and attract business to the state.
“This state is not lacking in ideas,” Thrasher said. “What it is dramatically lacking in is people taking great ideas and moving forward.”
Thrasher said the state’s tourism revenue is half that of Kentucky, the neighboring state with the lowest tourism figures. He said the state’s forests produce 24 million board-feet of lumber every year, but only 2 million board-feet is being harvested.
But Thrasher said the departments under the Division of Commerce are working to change that. He said bookings at state parks are up since online reservations were created, and the state harvested 10 million board-feet of lumber this year.
But Thrasher said the state needs to do more. He wants the Legislature to approve $15 million in funding for tourism advertising, a $40 million bond to fix state parks, Sunday hunting on public lands, repeal of the business inventory tax and $35 million for his office to help lure business and industry to the Mountain State.
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