March 17, 2010

All eyes on tourismIf tough times put a dent in Maine's largest economic sector, a lot of businesses and workers could suffer. This is a 6-60-1 dummy headyne yyyyy

By MATT WICKENHEISER Staff Writer

— The last of six parts

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Doug Jones/Staff photographer : Friday, March 21, 2008: Bill and Sandy Vorra, their son Will, along with Nick Helvig and his parents, Betty and Ron Helvig are served by Stacie Melanson, left as they dine at the Sudbury's Inn's tavern. Vacationing from Mystic, Connecticut, the families are visiting Bethel for a weekend of skiing.

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Doug Jones/Staff photographer : Friday, March 21, 2008: Scott Davis, new owner of Bethel's, Sudbury Inn, and "Pockets" the Inn's maskot, has the establishment peaking during ski season with hopes that nearby Sunday River Ski Resort will become a four season facility, to increase his summer business.

Additional Photos Below

By MATT WICKENHEISER

Staff Writer

This winter has been outstanding for tourism, even as the economy stalls.

Ski resorts have been open and packed since December. Snowmobiles have buzzed across Maine's vast network of trails. People have enjoyed the season on cross-country skis, snowshoes, skates and sleds.

Now the question arises: How is the summer tourism season shaping up, and what implications does that hold for the broader economy?

It's an important question.

Tourism is Maine's single largest sector. In 2006, tourists spent $6.7 billion in Maine. Directly and indirectly, that supported 176,633 jobs, generated $3.8 billion in wages and produced more than $531 million in tax revenues.

A strong summer showing could help alleviate the impact of the broader economic slowdown at a time when many analysts and economists see troubling signs.

A big concern nationally is that credit will grow tighter, choking economic growth. And although payrolls have held up in Maine so far, the country lost 63,000 jobs in February. Layoffs are an indicator of recessions, which are periods of extended negative economic growth such as the one that most economists believe exists right now.

Maine's Consensus Economic Forecasting Commission has cut its forecast for personal income growth in 2008 and predicts no increase in the number of jobs this year.

Maine leads the nation in people working multiple jobs -- commonly called ''under-employed'' -- noted John Mahon, dean of the University of Maine's College of Business, Public Policy and Health. Such workers can be vulnerable in a downturn.

''The multi-part-time job holders are often the first to lose their jobs -- an employer forced to reduce the work force generally lets part-time folks go to hold on to full-time employees,'' Mahon said. ''But if part-time employees get no benefits, then there will be a temptation to let full-time individuals go and/or convert full-time jobs to part-time positions.''

Economic woes aside, a successful summer season is largely dependent on good weather.

A weak summer tourism season would add to the problem -- less tax revenue for the state, fewer people from away spending money here, and possible job cuts. At least one economist who studies the sector isn't optimistic. Still, tourism-related business owners say they're seeing positive signs.

MORE SUMMER DRAWS IN BETHEL

Scott Davis bought the Sudbury Inn in Bethel in January, and has been busy.

''It's been hard-charging since Jan. 3,'' said Davis. ''It doesn't seem to be slowing down going into the summer months.''

Bethel is central to some of the region's prime skiing. People travel through on their way to Sunday River, Wildcat, Mt. Abram and other hills -- often staying in the town, hitting restaurants and pubs, or spending money at the various shops.

Bethel is about a 90-minute drive from Portland, about three hours from Boston and seven hours from New York City.

In the winter, the draw of skiing is obvious. But in summer, the Bethel region wouldn't be seen as such an obvious attraction for tourists as, say, Old Orchard Beach, or Wells, or the York beaches.

Davis said he and other business owners he's polled are optimistic about Bethel's increasingly compelling summer tourism season. The area is growing as a fishing destination, he said, and people are calling now about the summer, and to book venues for weddings.

Boyne USA Resorts, which bought Sunday River last year, is developing the ski resort into a four-season venue, said Davis. There's already a golf course there, and Sunday River reopened trails for mountain biking last fall.

''They haven't fully announced their plans going forward, but they are talking about aggressively developing the area,'' said Davis. ''They've indicated to their employees that in the future, they won't have to look for jobs in the off-season.''

Also boosting the economy is a still-active real estate market, with a number of people buying or building second homes.

POSITIVE SIGNS IN MILLINOCKET

If summer tourists have to drive a bit to get to Bethel, it's nothing compared with what they have to do when visiting Matt Polstein's properties in Millinocket -- a drive of roughly three hours and change from Portland. Polstein is co-owner of the New England Outdoor Center, running whitewater rafting trips and renting cabins, camp sites and lakeside houses in the shadow of Mt. Katahdin.

Still, even with a slowing economy, even with ever-increasing gas prices, Polstein is seeing positive signs for the summer. His bookings for rafting trips are up 15 percent over what they were this time last year. Bookings for rentals at his Twin Pine Camps are up 41 percent.

The Center currently has booked 81 percent of the business it did in August of last year, Polstein said.

''Through the '80s and the '90s, our industry always argued that in a period of economic softness, the activities we provided were affordable and represented an alternative to expensive vacations and mundane purchases,'' said Polstein. ''I think vacations that take advantage of natural areas are going to be probably less impacted, may even see some growth.''

ECONOMIST MORE SKEPTICAL

Those involved in tourism may be optimistic, but that's not necessarily true for the economists who study the sector.

David Vail, a Bowdoin economics professor, thinks the summer tourism season will be flat or down a bit, compared with last year.

''We're living through a period of growing consumer pessimism,'' Vail said. ''The use of discretionary income tends to move away from frivolous items like trips tourism that is dependent on what I would say is the non-rich taking marketable overnight trips is likely to be hit pretty hard.''

That pessimism is piled on top of real problems, he said -- people with debt problems who have overspent on credit cards, combined with a general stagnation of middle-class incomes since the 2000 recession.

And gas prices will likely play into the season's prospects, Vail said. AAA did a study a year ago that found car-based trips are generally only affected when the price of gas goes above $3.25 a gallon, he said. The statewide average for regular in Maine was $3.29 on Monday. And ''the smart money is saying gasoline prices are going to be well above $3.25 this year,'' Vail said.

''It has to do with what we might call 'threshold effects' -- a threshold of perception that 'Whoa -- this is really getting beyond our means,''' he said. ''Although objectively, it won't increase (the cost of the trip) by more than 10 percent.''

But all that is theoretical at this point. Vail said he's hearing anecdotally that snowmobile and ski operations are doing well this winter, despite the economic slowdown and already high gas prices.

''It does seem to suggest that pessimism and debt problems and gas problems might not be affecting (tourism) quantitatively,'' he said.

VACATIONS RESISTANT TO DOWNTURN

Recently, Davis asked guests checking out of the Sudbury Inn if they had considered staying home because of the high cost of gas. The answer was overwhelmingly ''no,'' Davis said.

Then he asked if they would curtail travel this summer if gas prices hit $4 a gallon.

''They said 'no.' They were tired of the gloom and doom, and they need to get away,'' Davis said.

That analysis fits with what Greg Dugal suspects. Dugal, executive director of the Maine Innkeepers Association, said his group's members are ''cautiously optimistic'' about the summer season. His board members' advance reservations were flat to a bit up, he said. Dugal said even in a weak economy, people are willing to give up only so much.

''The only thing you have left at this point is your vacation,'' said Dugal. ''Impulse travel will suffer greatly -- we'll feel that. But I don't think people are willing to sacrifice vacations yet.''

Staff Writer Matt Wickenheiser can be contacted at 791-6316 or at:

mwickenheiser@pressherald.com

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Additional Photos

click image to enlarge

Doug Jones/Staff photographer : Friday, March 21, 2008: The Kloepping Family, Dennis, Karolyn and their son Kyle, head off to the ski slopes from their rooms at Bethel's Sudbury Inn. The family is vacationing from their home in Upton, Mass. Scott Davis, new owner of Bethel's, Sudbury Inn, has the establishment peaking during ski season with hopes that nearby Sunday River Ski Resort will become a four season facility.

click image to enlarge

STAFF PHOTO BY HERB SWANSON, FEBRUARY 4, 2004: Adam Richards of Bethel makes tracks in the half-foot of fresh powder snow that fell early Wednesday morning on the Risky Business trail at Sunday River Ski area in Newry Maine.

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John Patriquin/ Staff Photographer: Wed., September,5, 2007. Maine guide Rocky Freda guides Dot-t and Joe Dehmer from Jackson, Miss. fishing on the upper Androscoggin river from Gilead to West Bethel, Maine today.

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STAFF PHOTO BY DOUG JONES -- Tuesday, July 14, 1998 -- Range Pond State Park's beautiful beaches attract many area regulars even on a Tuesday.

click image to enlarge

Doug Jones/Staff photographer : Friday, March 21, 2008: Bill and Sandy Vorra, their son Will, along with Nick Helvig and his parents, Betty and Ron Helvig are served by Stacie Melanson, left as they dine at the Sudbury's Inn's tavern. Vacationing from Mystic, Connecticut, the families are visiting Bethel for a weekend of skiing.

click image to enlarge

Doug Jones/Staff photographer : Friday, March 21, 2008: Scott Davis, new owner of Bethel's, Sudbury Inn, and "Pockets" the Inn's maskot, has the establishment peaking during ski season with hopes that nearby Sunday River Ski Resort will become a four season facility, to increase his summer business.

click image to enlarge

Doug Jones/Staff photographer : Friday, March 21, 2008: The Kloepping Family, Dennis, Karolyn and their son Kyle, head off to the ski slopes from their rooms at Bethel's Sudbury Inn. The family is vacationing from their home in Upton, Mass. Scott Davis, new owner of Bethel's, Sudbury Inn, has the establishment peaking during ski season with hopes that nearby Sunday River Ski Resort will become a four season facility.

click image to enlarge

STAFF PHOTO BY HERB SWANSON, FEBRUARY 4, 2004: Adam Richards of Bethel makes tracks in the half-foot of fresh powder snow that fell early Wednesday morning on the Risky Business trail at Sunday River Ski area in Newry Maine.

click image to enlarge

John Patriquin/ Staff Photographer: Wed., September,5, 2007. Maine guide Rocky Freda guides Dot-t and Joe Dehmer from Jackson, Miss. fishing on the upper Androscoggin river from Gilead to West Bethel, Maine today.

click image to enlarge

STAFF PHOTO BY DOUG JONES -- Tuesday, July 14, 1998 -- Range Pond State Park's beautiful beaches attract many area regulars even on a Tuesday.

  


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