Krcu's Let's Talk Business

Before the pandemic, technology visionary Leonard Brody called what we are experiencing today a complete reset of the operating system of our planet. And today, it’s only been accelerated. In a recent presentation, Brody said change today is occurring unlike anything we have experienced in the last 100 years. He believes the next decade will bring many of our structures and systems to a place we will barely recognize. At the Chamber, we agree. Just think about these economic drivers for our region and how they will change in the next ten years. Healthcare and its delivery systems, autonomous vehicles, electric vehicles v. gas powered, retail, K-higher education delivery systems, smart highway construction, banks and financial delivery systems, cyber security, utility infrastructure, and the list goes on. In preparation, the Chamber has re-established a Think Tank group designed to research, assess, and recommend ways to prepare ourselves locally for the changes we will face. It is our

2021 is a new year and with it comes a new set of laws, rules, and guidelines. Are you prepared? The Minimum Wage Rate in Missouri for private employers changed effective January 1, 2021. The Governor’s office announced the new rate is $10.30 per hour. All private businesses are required to pay at least the minimum hourly rate, except retail and service businesses whose annual gross sales are less than $500,000. They are still covered under the Federal Minimum Wage Law. As a result of the voter approved Proposition B in November of 2018, the minimum wage will increase 85 cents per hour each year through 2023 ultimately resulting in a minimum wage of $12 per hour in that year. Compensation for tipped employees must also total at least $10.30 per hour and employers are required to pay tipped employees at least 50 percent of the minimum wage – or $5.15 per hour, plus any amount necessary to bring the employee’s total compensation to the minimum of $10.30. Missouri law does not apply to

As 2020 comes to a close, it is time to pull out those crystal balls and look at some top predictions for the business world in 2021. Near the end of each year, I do research to determine what experts believe will be the top trends in business for the coming year. It is interesting how most agree with several leading concepts. Let’s take a look at a few. Convenience is absolutely critical. Regardless of business category, the customer now demands it. Coming out of the experiences of 2020, all businesses must provide an easy way to conduct all transactions. Another reality that continues to get stronger is the customer base just keeps getting smarter. Many times they know as much about a product or service as the person they are interacting with. So a positive customer service experience is critical. Closely related to these two is the need for businesses to effectively automate the business experience. Less paper, more video, and more experiential interactions are key. It certainly

No doubt 2020 has been a very challenging year. Let’s look at some interesting numbers and a few positive results. First, some numbers. The Cape Chamber has distributed more than 21,000 masks to local businesses at no cost to them in an effort to protect their employees, the customers, and to keep them open. In our congressional district, 823 businesses were approved for a PPP loan of greater than $150,000. Our staff participated in over 600 hours of COVID-19 calls and connected with members in more than 750 direct calls. We launched two new websites with several local partners: Keep Cape Strong and Reclaim our Region. And we enhanced our shop local / support local business push. Next, some economic development successes. Cape Area MAGNET announced seven projects representing more than 300 jobs and $67M in investment including KCOE-ISOM, the VA Health Services facility, and Patriot Medical Devices. MAGNET’s annual goals are 300 jobs, $50M new investment, and $12M new payroll so annual

In this year of challenging news, it is really nice to celebrate the positive announcements. Last Friday morning, December 4, at the Cape Girardeau Regional Airport, Southeast Missouri State University officially announced the new Professional Pilot Bachelor of Science program. This program is designed to train students to become commercial pilots and the FAA certification is part of the program. Students will fly early and often and highly performing students may be able to earn money and gain flight hours as flight instructors in their junior and senior years. And, of course, the pilot profession is paid well. This exciting announcement includes a partnership with the city of Cape, the Cape Girardeau Regional Airport, and U.S. Aviation Academy – an organization with 15 years of flight instruction experience. Congratulations to all the partners and especially Dr. Vargas, the Board of Regents, and the leadership at Southeast as they continue to look for ways to be recognized as a

This week we celebrate Thanksgiving and I want to take this opportunity to offer my thanks. First, I want to thank KRCU for this great partnership. Each week I have the opportunity to relay an important business topic to this key listener group. The comments I receive make me realize the importance of this segment. Next, I want to thank our membership. Because each of you are so committed to your role in your businesses and professions you make this place special. Thank you for your investment in our community, your growth in jobs, and your desire to always go the extra mile. And in this challenging year, your commitment has not wavered. I have to say thank you to our team. You are a great group to work with and I wouldn’t have it any other way. We learn from each other, stay focused on making this the best area possible, and have a lot of fun doing it! Thank you to all our area partners. Each of you plays a crucial role developing our people, products, environment, communities, and

Infrastructure can be defined as the physical structures necessary for the functioning of an area or a society. A reliable, robust infrastructure is extremely important for both business and the general public. Unfortunately, much of an area’s infrastructure can be overlooked or taken for granted because parts are not visible. We don’t see the intricate systems of storm sewers, sanitary sewers, water lines, gas lines, and some electrical services. We only notice these things when they don’t work. The traditional view of infrastructure revolved around our highways and transportation system. Roads and highways are more noticeable and very important to both the general public and to business. However, the last 9 months have highlighted an extremely important part of that less visible infrastructure. Yes, I’m talking about broadband and all things related to access to reliable technology. Experts will tell you nothing will have a greater impact on a region’s future success than the

Location, location, location – the phrase is well-known in real estate AND in economic development. Missouri is in a great geographic position with its location in the center of the United States. This can be an advantage in certain economic development projects. We are rich in many transportation resources including rivers, rail, highways, airports, and river ports. However, our transportation infrastructure is struggling. Within 500 miles of the state of Missouri is 43% of the U.S. population, 41% of buying power, and 44% of both wholesale trade and manufacturing plants. However, our infrastructure is deteriorating and, in many places, unsafe. We have the seventh largest transportation system but we are in the bottom five states in revenue per mile. We have the second lowest gas and diesel taxes in the nation and they haven’t been raised in decades. The Missouri legislature will convene again in Jefferson City in January, 2021. Let’s hope the legislature can decide on a fair and

One might argue tomorrow is one of the most important days in the United States in a long, long time Tuesday, November 3 rd is Election Day. And this is a presidential election year. Early voting numbers from throughout the country are extremely high and most experts believe total voter turnout will be at or above all-time records. Cape Girardeau County Clerk Kara Clark Summers believes between 82-85% of registered voters in the county will vote in this election. She made this prediction after a record setting day of absentee ballots. She is hopeful the high absentee numbers will ease the crowds at the polls tomorrow. Certainly, there are many issues surrounding this election. The global pandemic, civil unrest, the economy, the Supreme Court, tax policy, immigration policy, and more are all front and center. But let’s focus on what business owners believe about this election. Several surveys I’ve seen are consistent in reporting the opinions of business owners. More than 80% of small

The research is in and there are major benefits in having diversity on work teams. If you have the pleasure of having racial, gender, and age diversity on the team you work with, you probably understand my opening line. Either way, let’s look at some of the ways diverse work teams produce better results and add to the profitability of a business. Studies show diverse teams are more creative. Although you may be more comfortable working with people who share your same background, certainly people from dissimilar backgrounds see the world differently and can therefore generate more, different, and better ideas. A diverse group is not limited by one set of approaches and experiences. Much research indicates diverse teams are more likely to focus on facts and not get caught up in stereotypes. It seems diverse groups encourage greater examination of concepts and actions thereby keeping their approach sharp. The more trust within the group, the better the openness on helping team members

Now is a critical time for transportation infrastructure planning in the Cape/Jackson MSA. When an area becomes a federally defined metropolitan statistical area, they can establish a metropolitan planning organization. SEMPO, or the Southeast Metropolitan Planning Organization, serves that purpose for the local MSA. This is the group responsible for working with the Missouri Department of Transportation, the Illinois Department of Transportation, and the Federal Highway Administration to assess, plan, and improve the local transportation infrastructure. SEMPO was required by federal law to do a Metropolitan Transportation Plan. This plan identified how the metropolitan area will manage and operate a multi-modal transportation system (including transit, highway, bicycle, pedestrian, and accessible transportation) to meet the region’s economic, transportation, development and sustainability goals – among others – for a 20+-year planning horizon, while remaining fiscally constrained. The

A valuable tool in the area’s economic development infrastructure was only an idea in 1975. The Southeast Missouri Regional Port Authority is located on the Cape Girardeau County / Scott County line. The foundation of the Port’s development came in 1985 when more than 70% of voters in the two counties approved a one quarter cent sales tax that sunset in 1990. The slack water harbor was completed in 1989 and the general cargo dock followed in 1990. Both Burlington Northern Santa Fe and Union Pacific railroads serve the Port. In addition, the Semo Port Railroad provides local switching services for inbound, outbound, and in-plant movements tailored to each customer’s needs. Products handled at the Port are numerous and include coal, corn, soybeans, crude oil, fertilizers, and military equipment. These products are received from, or shipped to, 37 states and more than 30 countries around the world. Many tons of these products are received or shipped representing multiple millions of

As we enter October, what is the economic outlook for the U.S. in the fourth quarter of this unprecedented year? The answer to that question is a guess, at best, but there are some central themes emerging. Experts believe without the passage of another stimulus package of any kind before the end of the year, additional recovery in the economy will be much slower. Most expert forecasts for U.S. domestic product growth is now in the 3% range for the quarter – down from as high as 9% when there seemed an additional package would come out of Washington. There is a hint talks might resume but most believe there is only an outside chance. Then there is the election to consider. Election years always make things a little tricky to predict effects on the economy but this year, more than ever, that is the case. The wide variations in policy proposals and the continued uncertainty of the length of the pandemic make the last few months of this year a real question mark. What does that mean for us

Many local employers are experiencing some of the same issues they faced prior to the pandemic. Last year, we were in the tightest labor market of the last 50 years. Unemployment was at record lows and employers were having great difficulty finding employees in virtually all business sectors. Fast forward to today and while we are not seeing the low unemployment numbers like before, we are seeing an increase in hiring attempts by local businesses. A quick glance at local job postings shows many employers are, once again, trying to hire needed workers. These positions range from entry level, to semi-skilled, to professional. And more and more employers are expressing frustration in trying to find these needed employees. Are you surprised? In the immediate area, there are postings for police officers, accountants, bilingual reservation agents, nurses, plumbers, customer service representatives, manufacturing production workers, drivers of all kinds, and the list goes on. Recently, a

A new manufacturer of Person Protective Equipment has started operations in Cape and already landed a contract with the State of Missouri. Patriot Medical Devices began operations in late August. They are currently manufacturing 3-ply disposable face masks with American made materials and opened with 12 employees. Plans include hiring 9 additional workers quickly and then continue to expand as they increase production volume and add products including N-95 masks. The COVID-19 pandemic resulted in the realization of the United States’ reliance upon other countries for production of necessary PPE and other critical medical supplies. Patriot Medical Devices is committed to bring production and jobs back to the U.S. and chose to do so in Cape Girardeau. Missouri Secretary of State Jay Ashcroft announced a contract with Patriot to make masks available to the nearly 3,000 polling places in the state on Election Day. His press release made clear his excitement to provide a safe environment

The Paycheck Protection Program was certainly used as designed by the businesses in our area. The program, known as PPP for short, was part of the CARES Act passed by Congress and signed by the President in response to the COVID-19 pandemic. The program allowed businesses to apply for loans that could be forgivable if certain criteria were met and maintained. The loans were formula based and businesses had to apply through financial institutions. Maximum loan amounts were $10 million dollars and there were no minimums. We pushed hard locally to get the information to our businesses and our local financial community really stepped to the plate. And, it worked. According to information released by the U.S. Department of the Treasury, the Cape/Jackson MSA had approximately 200 businesses receive loans through the program. With several of these in the higher dollar categories, there is no doubt this area received millions of dollars in support to keep businesses open and workers employed.

As we celebrate Labor Day with this segment of "Let’s Talk Business," it is really difficult to get a grasp on the economic climate both nationally and locally. Last week we learned the U.S. debt reached its highest level compared to the size of the economy since World War II mostly as a result of the of the huge fiscal response to the pandemic. We watched the airline industry announce large permanent layoffs and release projections showing the industry may not fully recover for three to four years. Several additional national retailers teeter on the brink of permanent closure. And the hotel industry continues to struggle. However, we also watched as the U.S. stock market continued to rally as the DOW topped 29000 while the S&P and the NASDAQ posted record highs. There was positive news on the jobs front as unemployment continues to fall. Research continues on a vaccine for the virus and there were advancements in treatment using certain steroids. Locally, our unemployment rate is

Last week’s Governor’s Conference on Economic Development provided timely information and necessary optimism. Of course the meeting was held in a virtual format. Kudos to the Hawthorn Foundation for planning and carrying out event logistics. We heard from the St. Louis Cardinals organization about the changes this season and the real financial challenges. But, we also learned of several downtown economic development initiatives in St. Louis around Ballpark Village. Several sessions zeroed in on the importance of broadband. High speed internet connectivity is crucial for everyone in today’s new world. Business needs it for so many aspects of their operations and the entire education system has become dependent upon it. This makes the recent news from Big River Communication even better as they work to bring fiber to many previously underserved areas of Cape County. There were sessions on the future of manufacturing and how robotics, advanced materials, and industry 4.0 are shaping the

This is the time of year we realize only eleven cities in the state of Missouri are fortunate enough to be home to one of these important economic drivers. Cape is home to Southeast Missouri State University, founded in 1873. While Southeast’s primary purpose is to increase the human capital of its students, it also serves as a tremendous economic driver for the region. One way the impact is felt is through its graduates. The latest U.S. Census tells us individuals in Missouri with a bachelor’s degree earned an average of $16,720 more per year than those with a high school diploma or GED. Given more than 37,000 graduates live in the 24 county region served by Southeast, this effect is estimated to be more than $600 million dollars per year. But that’s not all. An economic impact study analyzed the annual spending of students, University employees, the University itself, and related construction projects. Results showed an annual economic impact of more than $1 million dollars for every

Many times I’ve heard people say just cancel 2020. It is a lost year. There is no doubt it is a challenging year. Just as we began, COVID 19 raised its ugly head. As a country, in parallel with the world, we started down a road not traveled during any of our lifetimes. But today, many experts and I urge all of you to not discard 2020. In the business world, let’s all use this catastrophe to evaluate our operation models. Businesses in categories hardest hit can use this to examine investments, staff, procedures, and most importantly, to pivot and build on opportunities moving forward. Retailers must strengthen their online presence. Restaurants must adapt to delivery methods. The travel and tourism industry must tap a different set of potential clients. And certainly, the entire education system must continue its investment in online instruction methods and infrastructure. For those in industries doing well, it is critical to capitalize on the demand and, again, determine ways to keep