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With Labor Day behind us, it’s time to assess Jackson Hole’s economy during the summer of 2020.

Or at least take a first crack at it. Data never come in as fast as I prefer, but during the first few days of September I received two pieces of data – daily traffic counts for Yellowstone National Park, and the August report of taxable sales in Teton County – that can serve as the foundation of a bit of analysis, especially as it relates to the effects of COVID-19 on the local economy.

This newsletter consists of three basic parts:

1. Yellowstone Summer Traffic Data
2. Teton County’s Taxable Sales During the First Four Months of COVID-19
3. Analysis
   • All the tourists; 60% of the capacity
   • The importance of locals
   • The importance of construction
   • Please Support Our Work

A request

One other note, or more precisely, a request: Will you please make a tax-deductible donation to my Charture Institute to support the work we do, including the analysis I provide in CoThrive?

Jackson Hole is in the middle of Old Bill’s Fun Run season. Thanks to the generosity of community-minded donors, Old Bill’s matches donations received by every local non-profit – last year, every dollar donated up to $30,000 was matched around 50%.

Please CLICK HERE to donate on-line.

Because of COVID-19, this year Charture has been deprived of one of our primary revenue sources: our annual 22 in 21 conferences. This makes donations such as yours all the more important.

The deadline for Old Bill’s giving is Friday September 18 @ 5:00 pm MDT. CLICK HERE to make your donation

Thanks for reading, and I look forward to hearing your thoughts, reactions, and comments.

Jonathan Schechter
Executive Director

I. Yellowstone Summer Traffic Data

Yellowstone National Park has five entry gates. Working clockwise from the park’s northern entrance, these are:

• North (from the gateway city of Gardiner, MT)
• Northeast (Cooke City, MT)
• East (Cody, WY)
• South (Jackson Hole, WY)
• West (West Yellowstone, MT)

Typically, each gate opens for the summer in late April or early May. This year, the two Wyoming gates opened on May 18, while the three Montana gates didn’t open until June 1.

The combination of the delayed opening and the nation’s struggles with the coronavirus resulted in a slow start to Yellowstone’s summer, with visitation during the park’s first several weeks markedly lower than in 2019. Starting in late June, however, things changed rapidly.

For the Jackson Hole gate, the switch seems to have flipped on June 26. From May 18 – June 25, only 8 percent of the days saw 2020 traffic counts higher than those in 2019. From June 26 – August 31, though, 96 percent of 2020’s days had higher traffic counts.

Graph 1 (below) looks at this phenomenon, comparing the number of vehicles entering Yellowstone in 2019 v. 2020 for three periods (for May, just the two Wyoming gates were counted):

• May 18 – June 25
• June 26 – August 31
• the total summer of May 18 – August 31

Graph 1

The big takeaway? During the summer of 2020, the growth in Yellowstone’s traffic was driven by traffic coming through the South Gate; i.e., from Jackson Hole.

In particular:

• during the first half of summer, the Jackson Hole gate had the lowest decline in traffic;
• during the second half of summer, the Jackson Hole gate had the biggest increases in both number of vehicles and percentage growth of traffic;
• for the overall summer, without people coming into Yellowstone from Jackson Hole, overall park traffic would have been down.

Which is why it felt so darned busy here.

(Note: Because the main road through Grand Teton National Park is a US highway, Grand Teton cannot provide the same kind of traffic data.)

II. Teton County’s Taxable Sales During the First Four Months of COVID-19

Data geek preface

Before getting into the data, three data-geek notes.

First, industrial codes. When you get a Wyoming business license, the Department of Revenue categorizes your operation using one of 10,000 North American Industrial Classification Codes (e.g., code 4441 is “Building Material and Supplies Dealers”). These codes are used when reporting taxable sales, and form the basis of this analysis.

Second, the sales taxes you collect in any given month must be sent to the state by the end of the following month. The state then tabulates the taxes it receives and issues its monthly report. For example, taxes you collect in July must be sent to the state by the end of August, so August’s report generally reflects sales in July. By extension, July’s report reflects June’s sales, etc. April was the first complete month that COVID-19 affected the local economy, meaning its effects were first fully captured in the May 2020 report.

Third, taxable sales account for only around 15 percent of Teton County’s economy. However, they are the best proxy we have for local economic activity because they are the only meaningful economic data reported accurately and regularly. Sales taxes also provide around 2/3 of local government general revenue – Jackson Hole is more dependent on sales taxes than the state of Wyoming is on hydrocarbons.

Onto the data.

The data

The first thing the data tell us is that, while COVID-19 clearly hammered the local taxable economy, even before COVID Teton County’s taxable sales economy was slowing down. For example, during the reporting months of January-August 2018, taxable sales grew 10 percent from the previous year. For those same months in 2019, the growth rate was 4 percent.

Then COVID-19 hit, and during the same January-August period this year local taxable sales fell 11 percent. As Graph 2 shows, in just four months the local taxable sales economy gave up over 1.5 years’ worth of growth.

Graph 2

It did so by dropping 20.5 percent during the four reporting months of May-August 2020 versus the same four months in 2019. (Graph 3)

Graph 3

What’s interesting, though is how unevenly the pandemic has affected Teton County’s taxable sales.

At a macro level, Teton County’s taxable sales fall into four basic categories:

1. Retail
2. Lodging
3. Restaurants
4. All Other

During the pandemic, sales in all four categories have declined. Get a bit more granular, however, and things are not quite as simple as they appear.

Graph 4 does two things. First, it breaks the four categories of local taxable sales into seven:

1. In-store retail (a subset of the larger Retail category)
2. Lodging
3. Restaurants
4. Construction (a combination of sub-categories in both All Other and Retail)
5. Car Sales (All Other)
6. On-line retail (Retail)
7. All Other

It then breaks the seven categories into two customer groupings: businesses patronized by a combination of Tourists and Locals, and those whose clientele is Primarily Local.

Graph 4

Two points jump off this graph.

First, broadly speaking, since COVID-19 hit, businesses associated with tourism have done poorly, while those catering to locals have done well.

Second, on-line sales are booming. Exactly how much of this growth is due to increased sales isn’t clear, for about a year ago Wyoming became more diligent about taxing on-line sales. That noted, it’s clear that a goodly portion of the 68 percent jump in on-line sales-related taxes is due to residents opting to use their devices to shop.
Graph 5 provides more detail about Retail sales, which is Teton County’s largest category in terms of sales.

Graph 5

Here again, COVID-19 wreaked havoc on Retail businesses catering to tourists, while seemingly benefitting those stores locals turned to for shelter-in-place supplies. Hence the growth in Liquor sales and those related to Home Improvement. Ditto Sporting Goods (because it’s too small to warrant its own category, Sporting Goods is lumped under “All Other”).

One other point worth noting about the local Retail scene is that Kmart shut down right before COVID-19 struck. The data suggest it generated around $3.5 million in annual sales, the loss of which is also lumped into “All Other.” Back Kmart out of the equation, and the decline in “All Other” was only 35 percent instead of 38 percent.

III. Analysis

The conclusions I draw from the data fall into three categories:

1. All the tourists; 60% of the capacity
2. The importance of locals
3. The importance of construction

1. All the tourists; 60% of the capacity

Both gut feeling and Yellowstone traffic data tell us July and August produced a bumper crop of tourists to Jackson Hole. Further, while we won’t have actual numbers for another few weeks, it seems likely that August’s sales tax numbers will be decent – not a record, but not nearly as bad as anticipated by most folks, including respondents to my spring surveys.

What the data won’t reveal is that, from a tourism infrastructure perspective, Jackson Hole handled all those visitors with one arm tied behind its back.

Friends object when I use the term “industrial tourism,” but I think it’s a fair description of Jackson Hole’s tourism industry. I don’t mean it as a pejorative, for to me the world’s economy is replete with industries producing highly sophisticated, highly-customized products. Like Jackson Hole’s tourism experience.

As with other world-class industries, tourism in Jackson Hole depends on a finely-tuned infrastructure, with a number of linked parts working closely with and complementing each other. Lodging, restaurants, retail, guides, transportation, cleaning services – all these and more must coordinate with one another to provide a high-quality and, with increasing frequency, high-end experience for the region’s visitors.

In this context, what was striking about this summer was how well this mechanism worked despite COVID-19.

COVID’s biggest blow to the local tourism infrastructure was the capacity reductions it forced upon Lodging and Restaurants. The hotels in Yellowstone and Grand Teton opened 40 percent of their rooms at best, some restaurants around the region converted to take-out only, and even those restaurants that did serve dine-in customers did so at no more than 60 percent capacity. Most other tourism-related industries dealt with their own challenges. Yet somehow it all worked.

Mostly. Talking to merchants and employees, the degree of end-of-summer burn-out seems to be at an all-time high, for workers had to knock themselves out to deal with a summer hallmarked by higher-than-usual tourist numbers and lower-than-usual staffing levels. All that plus the many other stresses of this most unusual summer.

The other thing I wonder about is what lessons employers will draw from this summer’s experience. Of particular interest is the fact that, for most tourism-related businesses, labor is the single biggest expense. Will this summer teach employers that they can save money by using fewer employees in the future? If so, at what price to the employees who are hired? And at what price to the visitor experience?

None of this is knowable right now. But given the extraordinary adaptability local businesses displayed during this extraordinarily challenging summer, I have to believe we’ll look back upon 2020 as a watershed in the internal mechanics of the local tourism industry, with it emerging leaner and, in all likelihood, more profitable.

2. The importance of locals

Graph 6 looks at the changes in four local economic indicators during June and July of 2016-2020.

The green bars are the percentage change in recreational visits to Grand Teton National Park. Building on the categories used in Graph 4, the yellow bars are the change in taxable sales by those businesses catering to tourists or a blend of tourists and locals.

The blue bars are a crude proxy for per-tourist spending, and show the result of dividing the yellow bars’ tourist-cum-blend sales into the green bars’ number of Grand Teton visitors. Finally, the red bars – the ones to pay attention to – are the taxable sales by businesses catering to locals.

Graph 6

The graph’s basic point is that sales to locals are becoming an increasingly important part of our summer economy. This was true even before COVID-19 thoroughly disrupted our tourism economy, and coronavirus or not, there’s no reason to think the trend won’t continue in future years.

Will summer sales to locals ever dethrone summer sales to tourists? Of course not. But as our population grows, and as it becomes ever-harder to cram even more tourists in here, sales to locals will likely grow faster than sales to tourists.

That noted, let me flag an utterly predictable exception. Next summer is almost certain to show a big jump in the growth of sales to tourists. Why? Because the ” in that calculation will be this summer’s knocked-down-by-COVID spending number. Reduce any ” enough, and big growth is bound to follow.

This “reduce the denominator” dynamic is the same one we’re currently seeing nationally with the sharp percentage growth in job numbers – the coronavirus knocked employment down so far that high growth rates became inevitable. And to editorialize just a wee bit, it’s at best disingenuous for Mr. Trump to take credit for those job increases if he wasn’t willing to assume responsibility for the decreases preceding them…

3. The importance of construction

The thing that most surprised me about the sales tax data was this.

For the reporting months of May-August 2020, taxable sales in the Lodging and Restaurant categories fell 27 and 48 percent respectively. Those drops were so sharp that, when combined with the 7 percent rise in Construction-related taxable sales, Construction-related sales actually eclipsed those of both Restaurants and Lodging.

As Graph 7 shows, that’s never happened before. Not even close.

Graph 7

This is, no doubt, a one-off occurrence – I expect that when next month’s numbers are reported, both Lodging and Restaurants will be back in their usual places, jockeying to see who plays second fiddle to Retail in terms of biggest category of taxable sales.

I highlight the construction figure, though, because it shines a light on a larger phenomenon, one that’s gotten lost in the chaos of not just COVID-19, but also the incredible growth pressures Jackson Hole has been and is facing.

For the past couple of decades, it’s become increasingly easy and acceptable for people to telecommute. As that’s occurred, Jackson Hole has become increasingly attractive to both primary and second home owners. In turn, that has produced two booms: in our non-tourism economy; and in the pressure for ever-more housing in the entire Tetons region.

In two ways, COVID-19 has thrown gasoline on the growth fire. One is that it has scared people away from crowded urban areas. The other is that it has produced a boom in working remotely. Combined, the result is a new wave of people moving to places like the greater Tetons region.

All this has created even more pressure for new construction, particularly housing.

As Graph 8 shows, this is not a new phenomenon. Indeed, since the beginning of 2015, Construction has been Teton County’s fastest-growing category of taxable sales.

Graph 8

Why does this matter? Because of the potential that the development industry will develop a momentum of its own, becoming so powerful that local elected officials will have a hard time saying “no” to its demands, regardless of those demands affect the rest of our community.

The Jackson/Teton County Comprehensive Plan is supposed to prevent this sort of imbalance from occurring. Indeed, the plan’s Vision Statement reads: “Preserve and protect the area’s ecosystem, in order to ensure a healthy environment, community and economy for current and future generations.” To that end, the Comp Plan and its related tools actively attempt to guide the amount and location of commercial and residential development in both the county and town.

That guidance is increasingly being questioned, though, by those who feel the Comp Plan is too restrictive. One particular concern is that it errs on the side of long-term environmental quality at the expense of today’s pressing needs.

Although the soundness of that argument is debatable, what’s undeniable is the importance of the local construction industry:

• There are about as many businesses in Construction as in Retail, Lodging, and Restaurants combined.
• Construction employs nearly as many people as Retail and Restaurants (although only 40 percent of those working in Lodging).
• The typical Construction job pays around twice as much as the typical Retail, Lodging, or Restaurant job.

Perhaps most striking is that, over the past 10 years, Teton County ranks 7th out of 3,112 US counties in per capita construction jobs, eclipsed only by counties recovering from Hurricane Katrina and those experiencing a fracking boom. Those, and Nantucket, where construction workers commute from the mainland on a daily basis.

Long story short, Construction not only plays a significant role in Teton County’s economy, but is growing in importance vis-a-vis tourism. Combine that with the essentially limitless demand for housing in Jackson Hole, and it seems almost inevitable that the pressure for new development will only increase over time. Doubly so should development slow down – given how large the industry is, how many folks it employs, and how much money is at stake, a slowdown in Construction will cause great disruption across the region.

The question then becomes what kind of community we are. Vision Statements such as the Comp Plan’s are developed not for the good times, but for when an organization is stressed: A Vision Statement’s fundamental purpose is to serve as a North Star for guiding decisions in difficult times.

The Comp Plan’s Vision Statement ranks a healthy economy third behind a healthy environment and healthy community. It does so because the plan’s animating belief is that if we preserve and protect our ecosystem, we and future generations will enjoy not just a healthy environment, but a healthy community. If we have those two things, a healthy economy will follow.

That much is clear. Less clear is whether we and subsequent generations will continue to agree with this formulation. The fact that no other place on the planet prioritizes environmental health over economic growth suggests those who embrace the Comp Plan’s current Vision Statement are, over the long run, fighting an uphill battle.

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Hello,

Welcome to the June 25, 2020 edition of the CoThrive newsletter.

First things first. Today’s my son’s birthday. He’s the apple of my eye, the spring in my step, the light of my life. He’s also 32, which is inconceivable (especially given that I feel no more mature today than I did the day he was born). I’m also confident that no father can bestow upon his son a greater birthday gift than a blog post discussing tourist visits to Yellowstone and Jackson Hole’s taxable sales – the happiest of birthdays, Alex.

The previous edition of CoThrive was published five days ago (click here to read it). In it, I looked at the first four week’s of this summer’s visitation to Yellowstone, and found that, for several days in mid-June, traffic counts through the South Gate (i.e., coming into Yellowstone from Jackson Hole) were essentially the same as they were in 2019. Since then, I’ve gotten additional visitation data, showing a drop. That kind of volatility is likely to be this summer’s theme.

The remainder of this edition focuses on how COVID-19 affected Jackson Hole’s taxable sales economy in March and April, the most recent months for which data are available.

• Yellowstone Visitation: May 18 – June 20
• Taxable Sales During COVID-19: Introduction
• Two Quick Explanatory Notes
• Big Picture
• Sales by Season
• COVID-19-related Losses in March & April
• How Locals Spend Money
• On-line Purchases
• Looking Ahead

The combined big take-away of the two pieces of research? This summer, Jackson Hole’s economy may end up doing better than we feared.

Thanks for reading, and I look forward to hearing your thoughts, reactions, and comments.

Jonathan Schechter
Executive Director

Yellowstone Visitation: May 18 – June 20

This summer, on a weekly basis, Yellowstone National Park has been kind enough to provide daily vehicle counts for each of its five weeks. Since my last newsletter, I’ve received an additional five days of data, and present them below in Figures A and B.

Yellowstone’s South Gate (Figure A) is its entry point from Jackson Hole. During the park’s first three weeks of being open in 2020, South Gate visitation was down markedly from the same days in 2019: 37%, 36%, and 41% respectively. Since the second full week of June, however (the week of June 8-14), visitation has picked up markedly – down just 9% the week of June 14, and 26% for the six days ending June 20.

Yellowstone’s overall visitation has not been as strong (Figure B). Of its four major gates (excluding the lightly-used Northeast Gate near Cooke City), traffic from the South Gate has clearly been the strongest.

Taxable Sales During COVID-19: Introduction

In the first week of June, the Wyoming Department of Revenue issued its most recent monthly sales tax collections report.

This was noteworthy because it provided the first comprehensive sense of how Teton County’s economy (at least its taxable economy) performed during a time of near-complete COVID-19-related economic shutdown.

Before exploring the data, though, a couple of contextual notes are in order.

Two Quick Explanatory Notes

Sales month v. reporting month

Let’s say you own a doughnut shop in Jackson, and sold $1,000 worth of doughnuts in April. By the end of May, you would be required to send Wyoming’s Department of Revenue $60 for the six percent sales tax levied on those sales. At the beginning of June, the department would combine your payment with all the others it received from Teton County in May, and send out the results. That was the report I received.

I mention this because the May report generally, but not perfectly, reflects sales in April. Why not perfectly? Because your $60 check would be included in the May report only if it arrived in May. If instead it arrived in June, it would be included in that month’s report. Similarly, if you check covering March sales arrived in May, it would have been counted in that month’s report. Big picture, though, May’s report generally reflects April’s sales, April’s report generally reflects March’s sales, etc.

The analysis below is drawn from the April and May reports, which reflect March’s and April’s sales, respectively. References are to the sales months, unless the term “report” is used (as in “May’s report”).

NAICS codes

The other thing to know is that, when the state issued the business license for your doughnut shop, it assigned a North American Industrial Classification System (NAICS) code to your account. There are 10 million such codes, including 7222133 for “Doughnut Shops: This industry comprises establishments primarily engaged in selling doughnuts, for consumption.” (This begs the question of what doughnuts are for if not consumption, but I digress.)

Using these codes, the state issues two reports of taxable sales by industry. The “Major” report identifies 20 different categories of industries using two digit NAICS codes (your doughnut shop falls under NAICS 72: “Accommodation and Food Services”). The “Minor” report classifies all of Teton County’s businesses into one of 306 different categories using the first four digits (your doughnut shop falls under 7222 “Limited Service Eating Place”).

These codes are the basis of the analysis below.

Big Picture

According to the May, 2020 sales tax report, Teton County’s merchants sold $62.3 million worth of taxable goods during April.

This represented a drop of 14.9 percent from April 2019’s sales. Yet because our economy was in a medically-induced economic coma in April, to me this not-even 15 percent drop seemed surprisingly small. Certainly it was smaller than the drop seen the previous month (reflecting March’s sales – Table 1). What happened?

Sales by Season

The first clue to explaining April’s relatively small drop lies with how taxable sales ebb and flow during the year. Historically, April and November vie for the slowest month of the year. As Figure 1 shows, over the past two years April has had the lowest percentage of Teton County’s total taxable sales, and May has ranked third.

The reason, of course, is that April is when the ski areas close and many residents go on spring break. If you make the crude assumption that the number of tourists who ski in early April balances out the number of locals who leave for spring break, then the April figure becomes a rough proxy for pure local spending.

Which, as Figure 2 shows, basically matches up with visitation data. Averaging the amount of monthly activity at the Jackson Hole Airport with that of Grand Teton and Yellowstone national parks, March and April are very slow (especially if you consider that much of late March’s air traffic is locals getting out of town for spring break).

The long and the short of it is that, if we had to get shut down by COVID-19, we got exceptionally lucky that the period affected was mid-March through mid-May. Arguably no other time of year would have been so fortuitous.

COVID-19-related Losses in March & April

Knowing the seasonality of our taxable sales also helps us better understand why May’s drop was surprisingly low.

Here’s a little basic math. As our baseline, let’s use the total amount of taxable goods local merchants and hoteliers sold during the fiscal year that ended February 29: $1.66 billion. Let’s also assume that the local tourism economy shut down on March 16, the day Jackson Hole Mountain Resort and Grand Targhee shut down.

Had COVID-19 not struck, then using Figure 1’s monthly taxable sales percentage, in March we would have expected to see $1.66 billion x 6.7%, or $111 million in taxable sales.

Instead, in March we got $87.3 million in total sales, a total decline of $23.8 million (21%) from the expected amount. (Table 2)

Do the same calculation for April, and we would have expected to sell $1.66 billion x 4.6% = $76.3 million worth of taxable goods. The actual, however, was only $62.3 million, a $14.0 million decline (18%).

Combined, in March and April Teton County’s taxable sales were $37.8 million lower than we would have expected, a drop of 20%. $16.8 million of that was due to the decline in tourists’ spending and the remaining $21.0 was due to a decline in non-tourist spending.

Put another way, tourists accounted for 44 percent of the $37.8 million drop in combined March and April taxable sales, while all other sources accounted for the remaining 56 percent.

How Locals Spend Money

That only 44 percent of the drop was due to a decline in tourist-related spending may seem surprising, but for two reasons it makes a lot of sense. First, only half of March was lost, and by all accounts tourist spending was robust in the first half of March. Second, even in a normal April there is essentially no tourist business. Had the COVID coma occurred at any other time of year, the tourists-to-non-tourist ratio would have likely been more skewed toward tourists’ expenditures.

Taking a closer look at how locals spend their money, as noted above the Department of Revenue’s monthly “Minor” reports associate each one of Teton County’s businesses with one of 306 NIAICS four-digit codes. Using these to determine whether a business serves tourists, locals, or a combination yields the sort of analysis shown in Figures 3-5.

Figure 3 shows the figures reported in the May report, broken down into the four basic categories of Tourism, Tourism/Local Blend, Local, and All Other. (Note: Because this section’s analysis is more granular than the one above, the two sections’ numbers don’t quite line up. Their gist is the same, though.)

The big take-away from Figure 3 is that April 2020’s tourism-related sales were off by about half from the previous year, local-related sales were about break-even, and those in blended categories basically split the difference.

Figure 4 breaks the first three categories into their respective sub-categories. Four things jump off this graph.

First, while the two basic “pure” tourism categories of Rental Cars and Lodging took big hits in April, they did not go away altogether. In part, this is likely due to late-arriving payments for sales taxes collected in March. Late payments can’t account for everything, though, so it’s likely some of April’s lodging sales were likely due to the “essential workers” who needed places to stay. Another part may be due to the fact that many downtown motels have been converted into seasonal or even year-round residences for Jackson Hole’s workforce.

Second, because they were not exclusively dependent on tourists, the “blend” categories fared better than the core tourism categories.

Third, the pure “local” categories did better than pure or blended tourism categories.

Fourth, only two categories of business showed an uptick in sales during April: Construction and On-line Shopping. The former was up a solid 7 percent; the latter was up an astonishing 87 percent (more on that in a moment).

Figure 5 looks at different sub-categories of Figure 4’s “Core retail” category, and it gets at one other interesting phenomenon.

During April, two retail sub-categories actually showed growth from 2019. One was Sporting Goods, up 22 percent (best guess: retailers trying to liquidate merchandise). The other was Liquor, up 53 percent (best guess: whatever it takes to get you through a very difficult month).

It’s also notable that gasoline was down as little as it was, especially given how much gas prices fell during the month.

Figures 6-8 show the same data for the April and May reports combined (i.e., the reports reflecting March and April’s sales). For good or ill, over the course of these two difficult months, the one retail category which grew was liquor.

On-line Purchases

So what about on-line purchases? In March 2020, they were up 93 percent over March 2019; in April they were up 87 percent; for the two months combined, a near-doubling at 90 percent.

Which, to put it mildly, is a stunning rate of growth, especially when compared to the 21 percent decrease in all other retail sales during the combined months of March and April.

This growth rate becomes even more eye-popping when we consider that, during March and April, on-line shopping accounted for 25 percent of all of Teton County’s retail sales, accounting for $12.4 million of Teton County’s total retail expenditures of $47.9 million.

And if that weren’t enough, take away on-line sales, and Teton County’s combined total taxable sales in March and April combined would have fallen an additional fifth, from 20 percent to 24 percent.

So what’s going on?

Three things, really.

First, during the pandemic, with a lot of stores closed, people turned to on-line shopping. Not just in Jackson Hole, but across the country.

Second, because so few tourists were here in March and April, retail sales were at their annual nadir. As a result, on-line sales could account for a much higher percentage of overall totals.

There was a third, more Wyoming-specific reason, though, for what appears to be such a huge jump in on-line taxable sales. This was a change in Wyoming’s sales tax laws.

As Figure 9 illustrates, through the first quarter of 2017, on-line retailers could sell goods to Wyoming residents and businesses without charging buyers any sales tax. This, of course, put Wyoming merchants at a big disadvantage, one that started to change in April, 2017, when Amazon began charging Wyoming customers the sales tax applicable in their county.

Commerce being what it is, all this led to a big court fight, which was eventually decided in the state’s favor. When that occurred, all on-line merchants selling into Wyoming had to charge sales tax (this happened in April, 2019, as indicated by the purple arrow in Figure 9).

The law being what it is, though, it turns out the ruling didn’t cover every on-line activity. This is because the on-line sales world is broken into two general categories of merchants: sellers and facilitators. Amazon is a hybrid of the two, selling some things directly and serving as an on-line clearing house, or “facilitator”, for other vendors. Last July, those facilitators were finally subject to sales tax, meaning that as of July 2019, essentially all on-line sales into Wyoming are taxed at the rate applicable in the recipient’s home county.

As a result, since last July Teton and other Wyoming counties have seen a huge surge in sales tax collections under the 2 digit “44 – Retail Trade” category. That artificial growth stimulus will end in another month, though, allowing us to directly compare growth in local local bricks and mortar retail to its on-line counterpart.

Looking Ahead

When we are able to make such “apples-to-apples” comparisons between types of retailers, though, I’m concerned our local bricks-and-mortar retailers will not fare well. This is because even before COVID-19, things were not looking good for Jackson Hole’s traditional retailers.

Retail is the single biggest category of Jackson Hole’s taxable sales economy. Back out building materials and on-line sales from overall retail sales, though, and this remaining “core retail” sector had essentially stopped growing before the pandemic struck. In particular, starting last fall growth dropped dramatically and, put charitably, had become anemic even during the halcyon pre-COVID days. Strong sales in building materials and, especially, on-line shopping were hiding this weakness among our core bricks-and-mortar retailers, but it’s been there for a while.

The concern, of course, is that our local bricks-and-mortar retail sector was not in strong shape going into what will arguably be Jackson Hole’s most fateful summer in decades – at least since 1988, and maybe for decades before that.

None of us knows what will happen this summer, but given how dependent so many of our retailers are on summer, it suggests many anxious weeks ahead for them. Combine that with the undoubted growth in locals’ on-line shopping, and it’s a fraught time to be a Jackson Hole bricks-and-mortar retailer. As much as it pains me to write this, my fear is that, six to twelve months from now, Jackson Hole’s retail scene will be much less-vibrant than it has been over these last few years.

Hello, and happy Summer Solstice!

Welcome to the June 20, 2020 edition of the CoThrive newsletter.

This newsletter’s purpose is to explore the concept of co-thriving; i.e., the state in which a human community and the ecosystem in which it lies simultaneously thrive.

In this, CoThrive is both an extension of the column I wrote for many years in the Jackson Hole News&Guide, and a refinement: an extension because the column ended two years ago when I became a candidate for the Jackson Town Council; a refinement because I want to use the newsletter not only to explore the dynamics of the Jackson Hole region, but also what it means to co-thrive – or whether co-thriving is even possible.

The first edition of CoThrive came out in January, and my plan was to publish it either monthly or, if things broke right, semi-monthly. As the saying goes, though, life got in the way of plans, and so this is the first edition in far too long.

On the positive side, in writing this piece I ended up with so much material that I’m splitting it into two editions. Both editions focus on the human side of the co-thrive equation by using looking at how COVID-19 is affecting Jackson Hole”s economy. Below I look at visitation during the first four weeks Yellowstone National Park was open (May 18-June 15). The June 25 edition (my son’s birthday – woo woo!) will complement the visitor data by looking at taxable sales during the month of April, the first full month of COVID-19’s effects.

• Yellowstone Visitation
• Data
• Concerns
• The challenge
• One final thought

The combined big take-away? This summer, Jackson Hole’s economy may end up doing better than we feared.

Thanks for reading, and I look forward to hearing your thoughts, reactions, and comments.

Jonathan Schechter
Executive Director

Yellowstone Visitation

Because of COVID-19, both Grand Teton and Yellowstone national parks opened late this summer, first letting visitors through their gates on Monday, May 18. On that date, Grand Teton opened all of its gates, while Yellowstone opened its two Wyoming gates: South (the access point from Jackson Hole) and East (Cody).

In normal times, both parks provide monthly visitor counts based on vehicle traffic. Because US 89/191 runs through the middle of Grand Teton National Park, though, that park needs to coordinate its traffic counts with those of Wyoming”s Department of Transportation. Yellowstone doesn”t have that complication, and this year the park has been kind enough to provide daily vehicle counts for each of its five gates (the three Montana gates – Northeast (Cooke City), North (Gardiner); and West (West Yellowstone) – opened on Monday, June 1).

Data

Figure 1 compares 2019 and 2020 total vehicle counts for the four weeks between May 18 and June 14. As it shows, in 2020 the number of vehicles entering Yellowstone from Jackson Hole was down 30 percent, and the park”s overall traffic count was down 37 percent.

Figure 2 breaks the overall data into four one-week periods, revealing a much different story.

During Yellowstone”s first four weeks of summer 2020, overall visitation was down at least 30 percent each week, and in the third week was down 46 percent.

The South Gate followed a similar pattern during the first three weeks, with each week”s vehicle count down around 40 percent. Things really changed in the fourth week, though, with 2020’s vehicle count only 10 percent below 2019’s.

Dig a little deeper, and for the five days between June 11-15 (the most recent five days for which I have data), 2020’s South Gate traffic was essentially the same as 2019’s. Save for the lightly-used Northeast Gate, this wasn”t true for the three other major gates, all of which were down 20%-30%.

To me, this seems significant because of recent talk that”town seems busy.” These recent South Gate vehicle counts support that impression: For at least a handful of days in mid-June, Jackson Hole”s 2020 summer visitation has been similar to 2019’s. (Figure 3)

Concerns

If visitation numbers do stay high, it will create two concerns.

The first is logistical. As in, if our visitor counts end up being surprisingly high, where will all those people sleep and eat? Roughly 2/3 of the hotel rooms in both Yellowstone and Grand Teton won”t open this season, and hotels outside of the park aren’t necessarily operating at full capacity. That”s certainly the case with restaurants, most of which have reduced their dining room capacities by half.

The point is that, compared to past summers, Jackson Hole has far less capacity to handle visitors. If visitation numbers aren’t correspondingly lower, the result will be a mess – too many people with too few places to stay and eat. Yet to the best of my knowledge, no effort has been made to figure out what our restricted visitor carrying capacity might be, much less how to align that reduced capacity with efforts promoting the region.

The second concern is health-related.

To state the obvious, thanks to COVID-19 across the country everyone is going stir-crazy. Throw in the onset of summer”s”it”s so nice outside” weather, and even the most disciplined person is itching to break away from the soul-crushing sameness of the COVID-19 lockdown.

Combine that stir-craziness with nationwide efforts to re-open the economy, and travel is picking up. Not air travel, but driving to places within easy – or in some cases not-so-easy – distance. Like Jackson Hole and, at its northern end, Yellowstone”s South Gate.

Pushing this thinking a bit further, who is going to be most likely to travel to a place like Jackson Hole? Answer: Folks less-concerned about COVID-19. Folks less-concerned about contracting it. Spreading it. Maybe even believing it exists. So when such folks get to a place like the Tetons, they”ll also be less-concerned about things like wearing masks and practicing social distancing.

Complicating matters further is that these folks are not only on vacation, but are likely on their first vacation since the COVID-19-related shutdowns. As a result, this will be their first opportunity to release all the pressure built up during months of self-isolation. And since they”ll likely hundreds of miles from home, they”ll also likely be several hundred miles away from the implicit COVID-related behavioral strictures a community imposes upon its residents (e.g., if someone you know gives you a dirty look because you”re not wearing a mask, it”s far more powerful than if that look comes from a stranger in a town you’re visiting).

Add to all this the dis-inhibiting qualities of alcohol, and it”s not hard to imagine an uptick in Jackson Hole”s tourism resulting in an uptick in Jackson Hole”s COVID-19 cases. Like, for instance, the rise we”ve seen from zero active cases on June 9 to nine on June 19.

Is that a lot? No. But the real concern is the same one that led to March”s clampdown: If the number of COVID-19 cases rises rapidly, it has the potential to overwhelm Jackson Hole’s healthcare infrastructure.

Perhaps this is unlikely. Hopefully it’s unlikely. The unfortunate reality, though, is that if you were going to design a place ripe for becoming a COVID-19 hotspot, you”d be hard-pressed to do better than Jackson Hole and our industrial tourism model.

What do I mean by”industrial tourism”? Just this. Especially in summer, Jackson Hole”s tourism industry depends on quantity, specifically on bringing thousands of people into our community every day, folks from all over the region, nation, and world. Once here, we push them into close proximity in hotels, restaurants, bars, and the like, then send them on their way a day or two later.

This industrial-scale process has worked extraordinarily well for Jackson Hole for many, many decades. In the COVID-19 era, though, such a process makes it essentially impossible to do widespread testing and contact tracing, the two keys to keeping coronavirus under control.

The challenge

Which creates an immense, incredibly thorny challenge. If we fully embrace our standard approach to summer tourism, we”ll leave ourselves and our visitors very vulnerable to a COVID-19 spike, catalyzed by tourists who are asymptomatic disease carriers. If we fully embrace health precautions, though, then our quantity-driven business model falls apart.

Which is why the most recent South Gate visitation data are so eye-catching, for they suggest we could be headed for a summer hallmarked by a worst-of-both-worlds hybrid: Large numbers of tourists plus insufficient tourism infrastructure leading to a lousy guest experience plus a second wave of coronavirus cases.

Through efforts like the Travel and Tourism Board”s Clean, Careful, Connected campaign, our community is trying very hard to strike the right balance between commerce and public health. The vexing problem, though, is that we have no clear idea how to address this unprecedented situation – there is no roadmap, no recipe, no blueprint to follow for what to do or how to do it. So we try, we wait, we gather and evaluate the best data we can find and act accordingly. And then we hope for the best.

One final thought

Everyone who loves Jackson Hole owes a huge debt of gratitude to those involved in creating the community”s response to COVID-19. Public health officials, business and non-profit leaders, government electeds and staff, and concerned citizens have all made Herculean efforts to address the manifold challenges COVID-19 has presented. As a result, the entire community can take great pride in knowing we”ve likely done everything we can possibly do.

None of which may matter.

This is because ultimately, the only thing that will matter is one thing we can”t control: whether potential tourists feel safe enough to travel.

Like a sense of humor or falling in love, feeling safe is visceral. There is no right or wrong – either you feel safe or you don”t. Whatever you feel is valid, and no matter what I say, I can”t change your mind because it”s not about your mind.

But your mind takes in information. For example, as I write this, Wyoming and every state surrounding us is experiencing a growth in confirmed COVID-19 cases. As is every state in the Mountain and Pacific time zones save New Mexico. Further, the Washington Post reports that confirmed cases are growing nationwide, and”The World Health Organization warned Friday that ‘the world is in a new and dangerous phase’ as the global pandemic accelerates.”

Will that matter to potential visitors to our region? Who knows? And the only way we’ll know is if they come. Or don”t.

What we do know is this, though. We”re living in a time of not just uncertainty, but fear. For some, it”s fear for their health. For others, it”s fear for their livelihoods. Or their businesses. Or how the pressures of the last few months are affecting their loved ones. Or themselves. Or some combination of all this and more.

All of which is difficult enough. Making things far worse has been the inexcusable killing of George Floyd and the spotlight it’s shone on racism, inequality, and so many other related issues.

We need to acknowledge and address these issues. These stresses. These fears. All are real, all are profound. And all affect us – as individuals, a community, a people – in ways we we don’t, and maybe won’t ever, fully understand.

Similarly, we have no clear understanding of how to address these manifold and interwoven issues – here again, there’s no roadmap, recipe, or blueprint. As we muddle our way along, though, in no small measure our success will depend on our ability to be empathetic – towards ourselves, our community, our world.

Or, as Mickey Hart, drummer for the Grateful Dead put it in the last words spoken at the Dead”s final show in Chicago on July 5, 2015:

“The feeling we have here –
remember it, take it home and do some good with it.
Hug your husband. Wife. Kids. I”ll leave you with this: Please, be kind.”

A Solid 2020 in Store

As we go roaring into 2020, what might the year hold for Jackson Hole’s economy?

I’ve got some ideas, but first it’s important to share a depressing reality: We don’t understand our economy very well, and certainly don’t measure it fully. Not even close.

What we know; what we don’t know

Economics may be the dismal science, but what the heck, let’s start with a joke.

A man walks out of a bar late one night. The block is dark save for one lamppost in the middle of the block. Underneath the lamppost is a guy on all fours – very clearly drunk and very clearly searching the ground for something.

After watching for a while, the guy says to the drunk: “What are you doing?”

“Looking for my keys” replies the drunk.

“Want some help?”

“Sure.”

So now two of them are looking, but after a few futile minutes the guy says to the drunk: “I don’t see your keys anywhere. Where did you drop them?”

The drunk looks up, points to the end of the block, and says “Down by the corner.”

“So why are you looking here?” asks the guy.

“Because the light’s better,” replies the drunk.

And that is the essence of why Teton County does a lousy job understanding and measuring its economy.

What we measure, and why

Wyoming is the most politically conservative of the 50 states, but in a very libertarian way: Generally speaking, Wyoming residents want as little government involvement in their lives as possible.

This libertarian streak plays out in a number of ways, most notably in how Wyoming funds state and local government – basically we rely on taxing stuff we dig out of the ground and buy at the mercantile. Property taxes are relatively light, and it’s a point of pride that the state has no income tax. Also important to this conversation is that one way we keep government out of our lives is by not measuring much of what goes on within our borders.

Critically, one thing Wyoming does measure is taxable sales. Why? Because especially for local government, sales taxes pay a lot of our bills.

Over-simplifying, Wyoming charges sales tax on those items that were important to the state’s economy when our governmental funding mechanism was established in the mid-20th century, most notably consumer goods, hotel rooms, and food and drink sold at restaurants. And because sales taxes are critically important to local government, the state requires them to be remitted monthly, then dutifully records and reports them.

Here in Teton County, no other economic metric is reported as frequently or accurately as sales taxes. Hence, because it’s the measurement we have at hand – the one streetlight on the block, if you will – we equate it with our economic health.

Which, at best, gives us a profoundly incomplete picture of our economy.

A complete assessment of Teton County’s economic activity would measure not just taxable sales, but all of the community’s other untaxed economic activities. These include non-taxable sales (e.g., professional services and recreational activities) and of course our untaxed income (wages, pensions, and investments). Add these into the mix, and in the most recent data year, taxable sales accounted for around 15 percent of Teton County’s total economic activity.(Figure 1)

Because it’s the only thing we measure on a regular basis, we equate taxable sales with our entire economy. But as with the drunk under the lamppost, in the absence of any other frequent and reliable metrics, we turn to these data even if they illuminate the wrong thing.

Sales taxes in Teton County

Despite this fundamental problem, taxable sales measurements have three things going for them.

First, as noted, they are reported every month.

Second, they seem to account for a relatively stable proportion of Jackson Hole’s overall economic activity: As Figure 2 suggests, especially since coming out of the recession, taxable sales have regularly accounted for 14-15 percent of all local economic activity. So while taxable sales data don’t give us a complete sense of what’s going on in our economy, at least they seem to give us a general sense of trends – if taxes are up X percent, the rest of the economy is likely up by a similar amount.

Third, sales taxes generate a lot of money for our state and local governments.

For every $100 of taxable sales made in Jackson Hole, the state of Wyoming gets $2.77 in general sales tax revenue, Teton County gets $1.23, and the Town of Jackson gets $1.00. Multiply that by the $1.63 billion worth of taxable goods sold in Teton County in 2019, and the state received roughly $44.9 million, the county around $20.0 million, and the town around $16.3 million.

Because the Town of Jackson doesn’t levy a property tax, sales-related tax revenues are especially important to the town, accounting for around 75 percent of its FY 2020 general operating funds. For the county, which does levy a property tax, the figure is closer to 50 percent.

Statewide, in FY 2019 Wyoming’s basic four percent sales tax generated around $768 million for the state’s general fund. Which gives us 768 million reasons why the state counts and reports sales taxes every month.

Sales taxes in Jackson Hole: A look back

The state’s current system for reporting overall taxable sales dates back to March, 1997. Because any one month’s figures can be wildly misleading, it’s far more instructive to look at 12- month running totals. As Figure 3 shows, during the two-plus decades between February 1998 and December 2019, Teton County’s total taxable sales grew from $621 million to $1.63 billion, a total growth rate of 162 percent and a Compounded Annual Growth Rate (CAGR) of 4.5 percent. (Adjusted for inflation, the growth figures were 65 percent and 2.3 percent respectively.)

As Figure 4 suggests, from a growth perspective the last 21 years can be divided into six periods: three of strong growth, one of moderate growth, and two of decline.

Three things jump off of Figure 4:

• During the three separate periods of strong growth, taxable sales grew at essentially the same pace – a tad over eight percent.
• The two periods of decline each lasted 21 months. The post-recession decline, though, was twice as sharp as the one around the time of the 9/11 attacks.
• The current period of strong growth has lasted 81 months, or nearly seven years.

The big question, of course, is how much longer the current growth period will continue.

Sales taxes in Jackson Hole: A look ahead

In July 2004, Wyoming began providing reports showing monthly taxable sales by industrial category. As a result, starting in June 2005 12-month running totals of these more granular figures became available. What do data tell us about the economy since then?

As Figure 5 suggests, if you create a line graph comparing Teton County’s taxable sales to the Standard & Poors 500 average (S&P 500) between June 2005 – December 2019, there’s a striking similarity to the shapes of the two lines.

The similarity becomes even more pronounced if you offset the S&P figure by 15 months, so that the S&P’s recession-related zenith and nadir align with those of local taxable sales. (Figure 6)

Happily, this visual similarity also holds up statistically, at a very high level of confidence. As a result, it can serve as the foundation of a model for estimating Teton County’s future taxable sales growth.

The model’s results

The S&P 500-based model of Teton County’s taxable sales suggests Teton County will continue to see taxable sales growth through at least the first quarter of 2021. Because of the lag between the S&P 500’s performance and local taxable sales, the model indicates this growth will occur even if the stock market slows down or begins to lose value during 2020.

How much growth? The model suggests that during calendar 2020, Teton County’s total taxable sales will grow 6.3 percent from 2019’s $1.63 billion figure, reaching a total of around $1.73 billion. (Figure 7)

Knowing this, the next question to ask is “Which sectors will experience the highest growth?”

Figure 8 shows, Teton County’s taxable sales can be broken down into six basic categories.

The county’s biggest sales tax-generating industry is Retail, which accounted for around one-third of all sales during 2019.

Second place is shared by two specific industries – Lodging and Restaurants – and the catch-all category of “All Other.” Last year, each accounted for around $300 million in sales.

Of note here is that, over the past 15 years, Restaurants has been by far the fastest growing local industry, with its sales tripling between 2005-2019. Only Retail has come anywhere close to matching that rate of growth.

Construction and Government (which is basically vehicle sales) are the two other major categories, each generating around $100 million in annual sales.

Unfortunately, the statistical correlation between the S&P 500 and most of these categories is not nearly as strong as with overall sales. The one exception is Retail, which the model predicts will enjoy 9.5 percent growth during 2020. The model also suggests Lodging, Government, and All Other will grow at around the same pace as the overall economy. That noted, because the statistical correlation is weaker, these estimates should be taken with a goodly-sized grain of salt.

In short, barring some sort of profound disruption, Teton County’s taxable sales in 2020 should grow at a steady, if not spectacular, pace – below the nearly-seven year average of 8.1 percent, but still a vigorous six-to-seven percent.

If there is a dark cloud out there, it’s hovering over the Construction sector. As Figure 9 illustrates, since May 2019 Construction-related sales have been declining.

The recession hit the local Construction industry hard, with taxable sales falling in half during its nearly-three year slump. Since starting to rebound in late 2011, though, local Construction-related sales steadily climbed, to a place where, in January 2019, they finally returned to their pre-recession highs.

Not for long, though. Starting last May, every month in 2019 had lower Construction-related taxable sales than in the previous year. The truly odd thing is that no one can explain why, for from their respective perches, people in all facets of the building trades suggest their business continues to be strong. The sales tax data show a softening though, suggesting that, at least when it comes to Jackson Hole’s construction industry, the whole may not be as strong as the sum of its parts.

A note of caution in what looks to be an otherwise solid 2020.

Income, Income Inequality, and Charitable Giving

The November edition of CoThrive focused on an astonishing fact: According to recently-released Bureau of Economic Analysis data, in 2017 Teton County, Wyoming had the nation’s highest per capita income: $251,728.

One quarter-million dollars, plus $1,728. An all-time record – not only for Teton County, but the nation as a whole.

Today, I’d like to examine the 2017 income data in more detail, focusing on three topics:
• Teton County’s income inequality;
• Teton County’s actual charitable giving; and
• Teton County’s potential charitable giving.

Before diving into these topics, though, let me offer one more tidbit regarding Teton County’s quarter-million dollar per capita income.

OMG

In second place behind Teton County was New York County, New York, the island of Manhattan. In 2017, New York’s per capita income was $193,940, 77 percent of Teton County’s.

That same year, America’s per capita income was $54,446. Add the two together – New York’s $193,940 and America’s $54,446 – and the total is $248,386. Or $3,342 less than Teton County’s figure.

In other words, in 2017 Teton County’s per capita income exceeded that of second-place New York City and the nation combined.

Regardless of whether you view things statistically, from an OMG perspective, or in some other fashion, Teton County’s 2017 per capita income figures are beyond extraordinary.

Why?

These astonishing figures raise the question of “Why?” As in “Why is Teton County’s per capita income so incredibly high?”

For answers, let’s turn to 2017 Internal Revenue Service (IRS) data.

Each year, the IRS breaks down income tax returns by Adjusted Gross Income categories (AGI). The lowest of the seven categories covers tax returns with an AGI of under $10,000; the highest covers returns of $200,000 or more. As Graph 1 shows, for the first six income categories, there’s little per-return difference between Teton County and the rest of America.

Once we get to AGIs of at least $200,000, though, Katy bar the door.

Graph 2 is the same as Graph 1, but adds the final IRS income category: returns with an AGI of $200,000 or more. In this category, Teton County’s per-return income figure is 2.5 times higher than Wyoming’s, and 3.5 times higher than the nation’s. What’s really astonishing is that without Teton County, Wyoming’s per-return mean falls by around $250,000, a full third.

Hence the short answer to the “Why?” question: Teton County’s per capita income figure is so high because of the income generated by households earning over $200,000/year.

Who are those people? While the IRS doesn’t identify individuals, we do know this.

In 2017, 14,410 households claimed Teton County as their residence. Of these, 1,870 – 13 percent, or roughly one-eighth – reported an AGI of $200,000 or more. This is high by national standards, but not dramatically so. (Graph 3)

What is dramatic is captured in Graph 4. In America as a whole, the 5 percent of households reporting a AGI of at least $200,000 accounted for 36 percent of the nation’s overall income. In Wyoming as a whole, the figures were essentially the same. In Teton County, however, the 13 percent of households reporting $200,000 or more in AGI accounted for an astonishing 84 percent of income. Meaning the remaining 87 percent of us earned just 16 percent of the county’s total income. (Graph 5)

America’s Greatest Income Inequality

Do the math, and in 2017 the 87 percent of Teton County households making under $200,000 had a mean AGI of $32,212. For the 13 percent of households making at least $200,000, the figure was $1.82 million, 57 times greater.

Simply put, Teton County has not only America’s highest per capita income, but also its greatest income inequality. And as with per capita income, the “contest” isn’t even close. (Graph 6)

Charitable Giving – Actual

Which raises another interesting question: “What are we doing with all that income?”

One thing is giving it away. Thanks to our well-to-do residents, Teton County led the nation in overall per-return deductions for charitable giving, averaging $16,516. And to sound like a broken record, no one else was even close: The per-return figure for second place Benton County, Arkansas, where Walmart’s world headquarters is located, was $11,864, 30 percent below Teton County’s figure.

Dig a little deeper, though, and a more complicated picture emerges.

In particular, among households earning $200,000 or more, Teton County did not lead the nation in charitable giving per return. While our mean charitable deduction figure was huge – $119,567 – it was 30 percent below Benton County’s figure of $164,464. As a result, our well-to-do households ranked only second in per-return charitable deductions.

Even more striking is that on a percentage basis, the 6.6 percent of AGI donated by our well-to-do residents ranked us only 90th in the nation – barely in the top three percent. The leader? Tattnall County, Georgia, whose well-to-do residents donated an astonishing 17.5 percent of their 2017 AGI to charitable causes.

Arguably, because Tattenall County has only 110 well-to-do households, it may not be fair to compare us to them. But Benton County has four times as many well-to-do households as Teton County, and their charitable deductions totaled 13.2 percent of their AGI, twice our percentage.

In fact, looking at the 100 US counties with the highest percentage of charitable giving among their well-to-do residents, Teton County’s mean AGI was 309 percent greater than the Top 100’s mean figure, but our percentage of AGI donated was 14 percent lower. (Graph 7)

Charitable Giving – Potential

Which leads to the next question: “What if Teton County led the nation in not just mean Adjusted Gross Income, but also in percentage of charitable giving?” Or perhaps more fairly, what if our giving rate equaled that of Benton County, Arkansas?

Running the numbers for 2017, if Teton County overall had donated at Benton AR’s overall rates, we would have collectively donated an additional $136 million to charitable causes. If Teton County’s well-to-do had donated at the same rate as their Benton County counterparts, the figure would have been an additional $228 million.

The bottom line is that, had Teton County residents given at the same rate as Benton AR residents, we would have roughly doubled the amount of money we gave to charitable causes. How much of that would have gone to local non-profits isn’t clear, but the IRS data suggest Teton County has a lot of additional charitable giving capacity.

Why Does It Matter?

One final question to ponder: “So what?” More precisely: “What difference does it make if Teton County has the nation’s highest per capita income?”

At a certain level, not a lot. Why? Because a community’s level of wealth doesn’t really affect its day-to-day life.

By this I mean that, regardless of income, we all have to eat, shop, get around town, and the like. And most of the costs associated with these basics – e.g., groceries, gas, and clothing – don’t vary much with a community’s wealth.

Where our wealth does matter, however, is in the price of Teton County’s scarcest commodity: land.

Specifically, of America’s 3,100 counties, only one has less private land than Teton County: Esmeralda County, Nevada: Population 826 (4 percent of Teton County’s) ; per capita income $40,113 (16 percent).

That Teton County has a limited amount of private land isn’t new, of course, but until 30 years or so ago, that scarcity wasn’t much of a problem. Why? Because our geographic isolation also isolated us from regional, national, and global economic forces, resulting in land prices being reasonably well-connected to the the local wage base.

No more. Instead, as changes in technology and the economy have increasingly stretched, frayed, and severed the umbilical cord that connects where we work to where we live, the demand for Jackson Hole’s incredibly scarce land has become essentially unlimited.

As it has, land prices have followed the basic law of supply and demand and gone up, up, up. As they have, those most able to buy that increasingly-dear land have been those with the highest incomes; i.e., those whose incomes are based either on investments or location-neutral jobs. And as that’s occurred, those whose incomes are based on “traditional” Jackson Hole industries such as tourism and construction have found themselves increasingly out-competed.

The resulting asymmetry has produced a host of consequences, affecting who can live here, commuting and traffic patterns, and community character. And while the consequences are clear, far less clear is what, if anything, we can do about them, especially given that the root causes of these issues – our wealth and income disparity – are unmatched in the nation.

Making our situation even more complex is the fact that we need to address all these issues while simultaneously ensuring the health of our ecosystem, for it is the foundation of everything vital to Jackson Hole. Added together, all of this presents a challenge as magnificent as our ecosystem; as extraordinary as our wealth.

Note: If you would like to make a tax-deductible donation to support CoThrive, please click here to donate to its parent organization – the Charture Institute/1% for the Tetons – through Patagonia’s match program. Through December 31, 2019, Patagonia will generously match donations up to $10,000.

Thank you so much, and happy holidays.

The Quarter-Million Dollar County

$251,728.

In mid-November, the US Bureau of Economic Analysis (BEA) released its 2018 economic data for America’s counties.  Using 2017 income tax data, the BEA calculated Teton County’s per capita income to be $251,728.

One quarter of a million dollars, plus $1,728. That, according to the BEA, was the mean amount of money earned by every one of Teton County’s 23,081 permanent residents. Regardless of age, gender, work status, or what have you.

We’re the quarter-million dollar county.

Never before in American history has a county had an annual per capita income of one quarter of a million dollars. Indeed, only five times in American history has a county had a per capita income of $200,000 or more:

• Teton County in 2014: $200,044
• Teton County in 2015: $202,833
• Teton County in 2016: $214,020
• Teton County in 2017: $227,753
• Teton County in 2018: $251,728 (Figure 1)

$251,728 ranks Teton County first among America’s 3,113 counties, and 2018 marked the 15th consecutive year Teton County has ranked first in the nation in per capita income. Never before has it been by such a large amount, though. Before Teton County took over in 2004, New York County, New York (the island of Manhattan) had led the nation in per capita income for 19 years. Since Teton took over, New York has been relegated to second or third place.

To put Teton County’s $251,728 figure into context, America’s per capita income was $54,446, or 22 percent of Teton County’s.

Of America’s 3,113 counties, only Teton had a per capita income greater than $200,000. In second place behind Teton County was the aforementioned New York County, with a per capita income of $193,940, 77 percent of Teton County’s figure. In 19th place was Goochland County, Virginia, with a per capita income of $100,545, 40 percent of Teton County’s figure. Every one of America’s remaining 3,094 counties had a per capita income of under $100,000. (Figure 2)

Teton County’s unprecedented-in-world-history income levels are due to its unprecedented-in-world-history levels of investment income. In 2018, Teton County’s per capita investment income was $185,891. Except for New York County, this investment income figure alone was higher than any other county’s total per capita income. (Figure 3)

74 percent of Teton County’s total income came from investments, a figure that also led the nation. (Figure 4)

Interestingly, Teton County also ranked in the top 1 percent nationally for wage income: Our per capita wage income alone was $59,809, ranking us 25th among all US counties, and a figure higher than the total income in 92 percent of all of the nation’s counties. But because our wage income accounted for only 24 percent of our total income – the nation’s second-lowest percentage – that nearly $60,000 figure seems relatively inconsequential. Unless, of course, you depend on wages for your income…

Between 2017 and 2018, Teton County’s per capita income grew $23,976. To repeat a now-familiar refrain, this was the nation’s highest figure, and that growth alone was greater than the total 2018 per capita income in America’s 14 poorest counties. (Figure 5)

Not surprisingly, of our 2017-18 income growth, $19,091 – 80 percent – came from increased investment income. The national average growth in investment income was $875, 5 percent of Teton County’s figure. No other county saw its per capita income grow by more than $8,230, 43 percent of Teton County’s figure.

I could keep going, but the two basic points are clear:

• By the widest margin ever, on a per capita basis Teton County retains its title as the wealthiest county in the wealthiest country in the history of the world.
• The source of that wealth is investment income

While Wyoming’s status as an “on-shore, off-shore” tax haven is the obvious reason for our tremendous income, and in particular our tremendous investment income, there’s more to it than that. Far more, actually, for if it were just tax considerations driving our success, other Wyoming counties would enjoy a similarly high income and similarly high proportion of investment income. But they don’t. Not even close. (Figure 6)

Instead, Teton County enjoys its singular place in history because of a combination of factors, including Wyoming’s tax-friendly status PLUS all of the hard and important conservation work done in the region over the past 150 years PLUS all that has been done to build the community’s human elements: its people, culture, and character.  

Which leads into a statement of the obvious: Very few things in life are purely good or purely bad. From that perspective, there are clearly downsides to Teton County’s record-setting wealth.

For one, Teton County’s record-breaking per capita income figure also means Teton County will retain its title as the US county with the greatest income inequality.

For another, the unprecedented amount and growth in income has had, and will continue to have, profoundly distorting effects on the qualities that attract people to Jackson Hole in the first place, including socio-economic diversity and the sense of community that flows from it.

All of these and more are subjects for exploration in further essays. First, though, it’s worth taking a moment to simply stand in amazement at the idea that, for the first time in American history, a county is so rich that in one year, its “average” resident earned one quarter of a million dollars. The mind boggles.  

In mid-September, the Joint Interim Committee on Corporations, Elections and Political Subdivisions of Wyoming’s legislature met in Jackson. While here, they breathed new life into HB 277, a bill killed in the 2019 session but which now may be re-heard in 2020.

Exactions help offset the costs new developments place on a community. Depending on how the final bill is worded, if passed the re-introduced HB 277 will strip away local government’s ability to levy some, if not all, exactions. This would be a big change for Jackson and Teton County, for both governments have levied affordable housing-related exactions since 1995, and other exactions even longer. Absent that tool, it will be much harder for local government to address the already fiendishly difficult challenge that is workforce housing in Jackson Hole. (For more about exactions, see box.)

Worried about maintaining local control over local issues, a number of organizations have teamed up to keep the bill from passing, including the Jackson Town Council, the Teton County Commission, Teton County’s legislative delegation, and several statewide advocacy groups. As a town councilor, one of my contributions to our effort is to counter advocates’ arguments that exactions are bad for the local economy. As a result, I’ve been doing a lot of research into the socio-economics of Jackson Hole over the past several decades. In this piece, I’d like to share some of my findings.

My research has covered a lot of topics. In each case I’ve tried to go back to at least 1990 to get a before-and-after sense of whether those exactions might have harmed the economy.

My basic conclusion? If housing exactions have harmed the economy, it’s sure hard to tell. Different flavors of housing exactions have been in place for nearly 25 years, and during that period Teton County has been an economic house afire. In fact, you could argue that, rather than harming Teton County, the exactions have instead actually benefitted us. How? By supporting our community character.

I say this because Census data about our seven “peer” Rocky Mountain resort counties – the locations of Aspen, Breckenridge, Park City, Steamboat Springs, Sun Valley, Telluride, and Vail – show that only 49 percent of their collective homes are occupied by full-time residents. In Teton County, the figure is 65 percent. No other resort county has even 60 percent. (Figure 1)

Having two-thirds of our homes occupied year-round helps keep Jackson Hole a community rather than a resort. Exactions have played a key role in keeping our housing stock locally-oriented, and as the data below suggest, tney have done so without compromising our economic vitality.

A dozen key facts

As I’ve come to see it, a dozen key facts paint a clear picture of just how robust Jackson Hole’s economy is.

1. Jobs per resident

My point of departure for my exactions research was the work I did for last month’s blog, which looked at Teton County’s workforce.

Specifically, a proximate reason why Jackson Hole’s local governments implemented workforce housing exactions in 1995 was what happened during the previous decade: a sharp rise in the number of jobs per Teton County resident. (Figure 2)

Specifically, between 1982 and 1990, Teton County’s per-resident job figure jumped from 0.82 to 1.23, a growth of 0.51 jobs per resident. To put that figure in perspective, in 1990 the US as a whole had an essentially-identical 0.55 jobs per capita – in eight years we added as many per capita jobs as the nation had overall.

To help address the resulting concerns, housing exactions were put in place. Yet even with this tool, today Teton County has 1.41 jobs per resident. This places us second among America’s 1,800+ counties with more than 20,000 residents, trailing only New York City and its 1.87 jobs/resident.

2. Constricted supply of land

97.2 percent of Teton County’s land is publicly owned. This ranks Teton second among America’s 3,100+ counties, trailing only the BLM-dominated Esmerelda County, Nevada, with a population of 826 and median age of 55.7. (Teton County’s population is 23,081, and our median age is 39.8.)

3. Virtually unlimited demand for housing

One-third of Teton County’s property tax bills are mailed out of the county. Teton County’s property owners live in 16 countries, in every state except North Dakota, and in 20 of Wyoming’s 23 counties.

Further, demand tor Jackson Hole housing is so great that it is spilling beyond Teton County’s borders, helping spur active real estate markets in portions of Fremont, Lincoln, Sublette, and other northwest Wyoming counties. While this Jackson Hole-driven growth is exposing people to Wyoming’s wonders beyond Jackson Hole, there is no evidence it is reducing demand for housing within the valley.

4. Nation’s highest income

In 2017, Teton County had by far the highest per capita income of any county in America: $233,869. This was one-third higher than second place New York City’s figure of $175,960, and 4.5 times higher than the national figure of $51,460.

In large measure Teton County’s sky-high per capita income is due to us having the nation’s highest per capita investment income, a result of Wyoming’s favorable income tax and trust laws. To this point, in 2017 Teton County’s per capita investment income alone was $174,804, essentially the same as second-place New York City’s per capita total income.

Between 1990-2017, Teton County had the highest per capita income growth of any US county. It also led the nation in per capita investment income growth.

5. Nation’s greatest income inequality

At the other end of the spectrum, Teton County also has the nation’s greatest wealth inequality. Two factors are at play here: our wealth and our job mix.

Regarding wealth, as noted above, Teton County residents have by far the nation’s highest per capita total and investment income.

Regarding job mix, historically Teton County’s economy has been oriented toward the tourism industry, whose business model depends on large numbers of relatively low-wage employees. In fact, for decades Teton County has ranked among the top 20 among all US counties in proportion of tourism jobs (retail, recreation, lodging, and restaurants).

Today, the average Teton County tourism job pays an annual salary of around $34,000. That’s one of the nation’s highest figures for tourism-related jobs, but it’s still only around one-fifth of our per capita investment income figure, and one-seventh of our total per capita income. This kind of gap makes it essentially impossible for much of our workforce to compete for our very limited housing stock.

Which leads to…

6. There is a huge gap between income and home prices

Teton County has high demand for a small supply of housing. As a result, according to the 2017 Census, Teton County’s median home price was $739,100, the nation’s eighth highest. (This will likely be much higher when the 2018 Census figures are released.)

Dividing Teton County’s median home price by the county’s median wage income of around $51,000, the result is 14.5. That is the nation’s second-highest figure, trailing only Nantucket’s 17.3.

In the US as a whole, the median home price divided by median income figure is 4.2. For Wyoming overall, it’s 4.4.

7. The market favors building high-end homes

Because of Jackson Hole’s supply and demand dynamics, high-end homes are the most profitable to build and sell. As a result, for two decades Jackson Hole’s housing developers have increasingly emphasized high-end homes, further squeezing the supply our workforce might be able to afford.

8. None of this is constraining Teton County’s population growth

Between 1990 and 2018 – i.e., from before we enacted housing exactions through today – Teton County’s population grew 108 percent. This was the highest growth rate of any Wyoming county, and ranked us in the top four percent of all US counties.

During that same period, as Teton County, Wyoming housing became more expensive, the population of Teton County, Idaho boomed. Its 229 percent growth rank the Teton Valley 15^th in the nation, placing it in the top 0.5 percent.

9. Nor our growth in residential construction…

Jackson Hole’s initial housing exactions went into effect in 1995, and affected both residential and commercial building. Following implementation, building activity may have slowed down some (the records are not clear on this). However, within a couple of years construction came roaring back, and between 1990 and 2018 Teton County’s housing stock nearly doubled.

During that same time, on a percentage basis, among Wyoming counties only Sublette had more housing growth during than Teton County: 108 percent for Sublette versus 99 percent for Teton. And only three Wyoming counties – the much more populous Campbell, Laramie, and Natrona – added more homes overall.

Despite this rapid growth in supply, from 1990-2018 Teton County’s median home price rose over 450 percent, over three times the national average and twice the Wyoming average. Viewed through the lens of the basic laws of supply and demand, these data strongly suggest an essentially insatiable demand for Jackson Hole housing.

10. Or commercial construction…

Unfortunately, historic town and county building permit data leave much to be desired. That noted, all available evidence suggests that, as with residential construction, Teton County’s commercial building economy quickly adjusted to our system of exactions. In particular, since 1995, Teton Village has undergone a spectacular commercial building boom, and the Town of Jackson has been revitalized with hundreds of thousands of square feet of new hotels, retail space, office buildings, and the like.

11. Or tourism

Grand Teton and Yellowstone national parks changed their visitor counting methodologies in 1993, and did not update previous years’ counts.

Between 1993 and 2018, Grand Teton’s recreational visit count grew by three-quarters of a million people, a 28 percent increase. Yellowstone’s figures were 1.2 million and 41 percent. Roughly two-thirds of the parks’ combined growth came during the four summer months.

During that same stretch, both the number of skier days at the Jackson Hole Mountain Resort and the number of commercial enplanements at the Jackson Hole Airport more-than-doubled.

12. Tetons tourism packs quite a sales tax punch

Among Wyoming’s 23 counties, Teton County ranks ninth in population but sixth in amount of taxable sales. The counties it trails are either heavily dependent on extractive industries – Campbell, Converse, and Sweetwater – or have populations four-to-five times larger: Laramie and Natrona.

Conclusion: The Big Disconnect

Among the reasons economics is called the dismal science is that it’s not very tangible – so much of economics boils down to little more than arguments over figures on a page.

If we consider the more tangible aspects of Teton County’s economy, though, things have really grown over the past 30 years. In particular, during that time we’ve experienced extraordinary growth in a variety of areas, including:

• Three-quarters of a million more visitors to Grand Teton National Park
• Twice as many homes
• More than twice as many airplane passengers
• More than twice as many Teton Village skiers
• More than twice as many residents

What about that less-tangible stuff? There’s an interesting paradox at work.

During the most recent twelve months, Teton County’s merchants sold around $1.6 billion of taxable goods. In 2017, the figure was around $1.4 billion. These numbers are important because both the Town of Jackson and Teton County are very dependent on sales tax revenues for funding their general operating budgets: In FY 2020, Jackson estimates 74 percent of its operating revenues will come from taxable sales; Teton County’s figure is around 50 percent.

Now consider this.

Also in 2017, roughly $1 billion in Teton County real estate was sold, and residents earned another $1.2 billion in wage income. None of this $2.2 billion worth of economic activity – 50 percent more than total taxable sales – directly contributed a penny to local government coffers.

Add the three figures together – $1 billion in real estate sales PLUS $1.2 billion in wages PLUS $1.4 billion in retail sales – and the total is $3.6 billion.

Which is a lot of money. But it’s also $500 million less than the $4.1 billion Teton County residents earned in 2017 in investment income alone.

Do a bit more math, and in 2017 Teton County had at least $6.3 billion of economic activity that contributed nothing directly to local government’s operations: $1 billion in real estate; $1.2 billion in wages; and $4.1 billion in investment income.

Contrast that to the community’s $1.4 billion of taxable sales, and the bottom line is that we’re asking perhaps one-sixth of the county’s economy to support all we ask local government to do.

Including provide affordable housing. Hence the importance of exactions. Why? Because exactions give local government a housing-related funding tool unrelated to taxable sales, injecting a little balance into Wyoming’s wildly unbalanced system of funding local government.

Wyoming’s system for funding state local government was developed in the 1970s, and has proudly and stubbornly refused to change even as the world around it has. With our nation-leading status in so many economic categories, Teton County is about as far removed from the economy of the 1970s as any place on Earth, and all indicators are this disconnect will become only greater in coming years. As it does, the strains manifesting themselves in the kerfuffle between the Corporations Committee and Jackson Hole are only going to become more acute.

Hello, and welcome to the first edition of the CoThrive blog.

CoThrive will replace the Corpus Callosum column I no longer write for the Jackson Hole News&Guide. Like that column, it will examine issues affecting Jackson Hole, the greater Tetons/Yellowstone region, and similar communities outside our region.

For the remainder of 2019, CoThrive will be offered without charge. If you would like to subscribe, please click here.

The research and analysis underlying CoThrive is representative of the fact-based, action-oriented work my Charture Institute does. If you would like to support our work, please click here to make a tax-deductible donation to Charture through Old Bill’s Fun Run.

Below, you’ll find that this initial edition of CoThrive is divided into four parts:

• Some background on CoThrive (click here)
• The logistics of CoThrive (click here)
• This month’s main essay: The Jackson Hole Paradox: Big City Traffic and Jobs; Small Town Population (click here)
• An addendum with additional information I unearthed researching this essay (click here)

Thank you so much for your interest in Charture. I look forward to your feedback, and thank you in advance for supporting our work through Old Bill’s Fun Run.

Cheers!
Jonathan Schechter

Please support our work by donating to Charture through Old Bill’s Fun Run

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CoThrive: Background

In late May, 2018, I announced my candidacy for Jackson’s Town Council. When I did, the Jackson Hole News&Guide and I agreed to suspend my Corpus Callosum newspaper column until after the election.

Happily, I won my race, but being an elected official creates its own conflicts. As a result, until I leave office, I will not be writing for the News&Guide.

Hence this blog: CoThrive. Its organizing principle will be an idea I’ve become increasingly obsessed with over the past few years: To the best of my knowledge, since the dawn of the Industrial Revolution 250 years ago, Jackson Hole is the only community, region, or nation on Earth to develop a successful post-agrarian economy without fundamentally compromising the health of its ecosystem.

That’s a remarkable concept. At a number of levels. Both locally and globally. Yet at its most elemental level, this only-place-in-250-years idea illuminates the most fundamental fact about our community: If Jackson Hole wants to continue to thrive as a human community, we have no choice but to figure out how to keep our ecosystem healthy.

Unfortunately, there is no roadmap for us to follow. Indeed, 250 years of history suggest we’ll fail in that effort. Rather than succumb to pessimism, though, I decided to launch CoThrive as a real-time tool to help all those who care about this region figure out that which no community has ever done before.

And if we get it right, our roadmap can become a guide for other places looking to co-thrive.

“Co-thrive” is a term I coined to describe the state in which a human community and the ecosystem in which it lies simultaneously thrive. Building on this theme, the CoThrive blog will primarily focus on the Tetons region’s human community, its ecosystem, and the nexus between the two. Because the issues facing the region are so complex, however, and because no one really knows how to achieve a state of co-thriving, I’ll also use the CoThrive blog to explore ideas and events outside the bubble that is the greater Tetons/Yellowstone region.

Please support our work by donating to Charture through Old Bill’s Fun Run

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To contact us, please call (307) 733-8687, or e-mail js@charture.org

CoThrive: Logistics

CoThrive is a logical extension of the work of my Charture Institute, whose five-part focus is “Learn. Teach. Inspire. Act. Fund.”

My hope had been to launch CoThrive months ago, but the drinking-from-a-firehose quality of learning my Town Council job has proven nearly all-consuming. One result is that I don’t know how frequently I’ll be able to produce new editions of CoThrive. My desire is to produce at least one lengthy analytical piece per month, with additional smaller features offered on an irregular basis. Whether the actions of the flesh can match the willingness of the spirit, though, remains open to question.

Because of this uncertainty, for the remainder of 2019 CoThrive will be offered for free. That will give the blog four months to hit its stride, allowing us to figure out both a publishing schedule and a pricing model that work for both the readers and us. Until then, enjoy it with our compliments.

That noted, while CoThrive may be free to readers, it is not free to produce. Far from it. To support this work, Charture Institute accepts tax-deductible donations – please click here to do so through Old Bill’s Fun Run.

Old Bill’s matches donations to its recipients. Old Bill’s donations are accepted through 5:00 pm MDT on Friday, September 13.

Please support our work by donating to Charture through Old Bill’s Fun Run

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CoThrive: Main Essay

The Jackson Hole Paradox:
Big City Traffic and Jobs; Small Town Population

Around dinnertime a couple of weeks ago, I drove east on Snow King Avenue. Heading west were three-quarters of a mile of bumper-to-bumper traffic, stretching from Scott Lane to the Fair Grounds.

To tell you what you already know, the same thing happens in Jackson Hole pretty much every day, especially on the highways in and out of town. And often in both directions. And, increasingly, not just in summer. Clearly we have a traffic problem, and that got me wondering about its root causes.

Here’s my basic conclusion. Jackson Hole creates jobs like a big city, resulting in big city traffic problems. Because we have the population of a small town, though, we lack the critical mass of people needed to make mass transit work well.

Exacerbating this job-production reality is our tourism economy. Combine our jobs-created traffic plus that generated by thousands of tourists and the result is an extraordinarily vexing transportation problem.

Special challenges, and a unique challenge

Jackson Hole is not the only place facing traffic problems, of course – we’re special, but not unique. Indeed, we face the same suite of problems facing every other special place to live on the planet, including traffic, affordable housing, and issues related to increasing wealth inequality.

On top of these special problems, Jackson Hole also faces a truly unique challenge: Preserving the health of our ecosystem. To the best of my knowledge, Jackson Hole is the only place on Earth that currently has both an advanced post-agrarian economy and a basically intact ecosystem. Making matters more complicated still is a further reality: No blueprint exists for successfully addressing any of the challenges we face, whether special or unique.

Rather than despair, let’s take the first step needed to successfully address any problem and examine the root causes of our traffic issues.

Jackson Hole’s “peers”

Context is important, and among the 3,113 counties in the United States, Teton County, Wyoming is one of 1,815 – 58 percent – with a population greater than 20,000.

I’m focusing on these more-populous 1,815 counties because they are home to 96 percent of the nation’s population and 97 percent of its jobs. Do the math, and in 2017 America as a whole averaged 0.60 jobs for every U.S. resident, be they child, retiree, chronically unemployed or actively in the workforce. In counties with a population greater than 20,000, the per capita job figure was a bit higher: 0.61 jobs per resident. In the less-populated counties, the figure was lower: 0.50 jobs per resident.

In 2017, eight of the 1,815 more-populous counties – 0.4 percent of the total – had more than one job per resident. Leading the way was New York County, New York, the island of Manhattan, with 1.87 jobs per capita (each of New York City’s five boroughs is also its own county – Figure 1).

New York’s per capita jobs figure is so high – three times the national average – because around two million people pour into New York City every day to work, only to return each evening to their home outside of Manhattan. And because some 20 million people live in the greater New York City metropolitan area, both financially and logistically the region can afford to have a large and effective multi-modal mass transit system.

Ditto four of the other seven counties with more than one job per resident: Washington DC (1.30 jobs/resident, and 6.3 million people in the metropolitan area), Atlanta (1.08 and 5.9 million), San Francisco (1.07 and 4.7 million), and Boston (1.06 and 4.9 million).

Ranking seventh among the eight more-populous counties with more than one job per resident was Summit County, Utah, with 1.03 jobs per resident. Summit County is the location of Park City, and its job count is a reflection of the fact that tourism is a labor-intensive industry. Happily for that community, because it is part of the Salt Lake City metropolitan area (population 2.4 million), Park City has access to some, although by no means all, of the mass transit solutions available to big cities.

In eighth place, at 1.02 jobs per resident, was Williams County, North Dakota, the epicenter of the Bakken Basin oil boom. In 2007, Williams County had 0.75 jobs/resident; five years later, 1.51 jobs/resident; five years after that, 1.02. This is a classic boom/bust pattern, and when an economic slowdown occurs, the resulting decline in oil prices will likely lower Williams County’s job figures.

And then there’s Jackson Hole.

Jackson Hole

In 2017, among America’s 1,815 counties with a population greater than 20,000, Teton County had the second-most jobs per capita: 1.41. More jobs per resident than Washington DC. Or Atlanta. Or San Francisco. Or Boston. Or, saving New York City, any other American county with more than 20,000 residents.

Yet rather than being home to millions of people, our “metropolitan area” has around 45,000 residents; i.e., about one percent (if that) of most other job-producing Meccas. And with a population our size, it is profoundly difficult to run an affordable and well-utilized mass transit system.

Hence we get traffic. Lots and lots of traffic. How much?

Hard to say exactly, but along with more than one job per resident, we also have more than one vehicle registered per resident. And over the last ten years, our total vehicle miles traveled have increased faster than our population.

Making it harder still to run an affordable and well-utilized mass transit system in the Tetons region are two additional realities.

Two additional realities

The first is population density. Teton County’s population is not only a mere fraction of major metropolitan areas’ populations, it’s also far more dispersed. For example, the private lands in just the southern half of the Jackson Hole valley can hold two islands of Manhattan. Yet in an area that could hold 3.3 million New Yorkers you’ll find only about 10,000 Jackson Hole residents. This means Manhattan’s population is 330 times more dense than ours, and its subway system alone serves around 1,800 times more riders than does START.

The point is that if you have New York’s population density, you can make an effective mass transit system work both logistically and economically. In contrast, if you have Jackson Hole’s population density, it’s much, much harder.

Second, even if you have a small population, it’s still possible to do effective mass transit. Case in point: Butte County, Idaho. Located four counties to our west, Butte County has the greatest number of jobs per resident of any US county. Its population is tiny, just 2,600 or so. But because Butte County is the location of the Idaho National Lab (INL), in 2017 it had over 8,600 jobs – 3.3 per resident.

Yet here’s the crazy thing. Despite having a population only one-tenth that of Teton County, Wyoming, Butte County has a great mass transit system. Or, more precisely, INL has a great mass transit system, serving thousands of people daily on five different routes.

What makes this possible is that the INL bus system is a hub-and-spoke model: Buses from all over the region head to one place at about the same time each morning, then reverse the process each afternoon.

Contrast that to our situation in Jackson Hole. With the exception of Teton Village in the winter, our region has no major employers, hubs, or times of day with overwhelming peak demand. Instead, we have lots of employees coming from different places, going to different places, and doing so at different times of day. Ditto people who are out-and-about for non-work reasons.

To serve this kind of population requires a point-to-point system – think of New York’s subways. Such systems work well if they serve a population of millions and have a ridership of billions. They can’t, however, if those population and ridership numbers are chopped into not just percentages, but fractions of percentages.

Why so many jobs?

To take this analysis to another level, why are we such a job-producing machine? A large part of it has to do with tourism.

Tourism is extraordinarily labor-intensive, and in 2017, 36 percent of all of Teton County, Wyoming’s jobs were in the four main tourism-related industries of retail, recreation, lodging, and restaurants. This 36-percent-of-all-jobs-in-tourism figure ranked Teton County 19th among the nation’s 3,100+ counties.

Drilling a little deeper, in 2017 nearly one-quarter of all of Teton County’s jobs were in the combined category of lodging and restaurants, over three times the national average and ranking us 11th out of all US counties. We’re similarly strong in the “Arts, Entertainments, and Recreation” category, where our five percent figure – over twice the national average – ranked us 49th overall.

This matters because one hallmark of tourism-related jobs is the odd hours they require. The bakers at Persephone arrive to work not too much later than the bartenders at the Cowboy head home, and not only do they work far apart from one another, the chances are they live far apart. Apply that reality to each of our 12,000 or so tourism jobs, and from a mass transit perspective it creates the worst of all possible worlds: a ton of workers going and coming to different places at different times, yet without the critical mass needed to allow for effective public transportation solutions. So they, like so many of us, rely on their cars.

The one tourism-related employment category where we aren’t in the nation’s top one percent or so is retail. Despite the industry’s prominence in Jackson Hole – it’s the single biggest generator of local taxable sales – just eight percent of Teton County’s workforce is employed in retail jobs, 20 percent below the national average.

One other area of note regarding employment and traffic is that the second biggest single employment category in Teton County is construction, which accounts for roughly ten percent of our jobs. This ranks us in the top eight percent of all US counties, and before the recession we were in the top four percent. Why does this matter? Because contractors need their trucks, and Teton County’s roughly 3,000 construction jobs put a lot of vehicles on the road every day.

On top of all this, of course, is the traffic generated by our tourists. But the point these data make is that the combination of four factors – Teton County’s prodigious job-creation engine, our small population, our limited amount of private land, and the constraints we face regarding our transportation infrastructure – means traffic-related woes will be with us for some time, regardless of our tourism situation.

What to do?

So what do we do? If we had the population base of other major per-capita jobs communities such as New York or Boston, we could build a crackerjack mass transit system. But if we had that kind of population base, we wouldn’t be Jackson Hole.

Alternatively, we could try to improve our road system, but at this point its basic contours are pretty well set. Plus, because of our where we’ve put our houses and businesses, it would be pretty hard to do much more than merely tinker with our current road system.

And even if we do add new roads or widen existing ones, it’s wishful thinking to believe this will “solve” our traffic problem. This is because, as has been shown in city after city, whatever congestion relief new roads produce is quickly negated by a phenomenon called “induced demand,” which shows that regardless of how big you make a new road, its traffic will eventually expand to fill it to capacity once again.

Two lousy choices

This leaves just a couple of choices, neither of them great.

One is to fundamentally alter our approach towards mass transit and parking. This will cost a lot of money, though, and almost certainly require a tax increase of some sort.

This begs a fundamental question. What do Jackson Hole residents like less: traffic congestion or higher taxes? If it’s the former, there are clearly steps we can take, including developing a low-cost, expansive, and frequent bus system; congestion pricing for our roads; paid parking; and a vigorous alternative transit system. But such solutions are not cost-free – far from it. So if what really matters most to Jackson Hole residents is keeping our personal tax burden among the nation’s lowest, then we need to accept traffic congestion.

Put another way, we’ve had Champagne tastes and a beer budget for decades now, and traffic is the most obvious symptom of why that can’t continue.

Following this thought process through to its logical conclusion, if, after a thoughtful debate, the community decides lower taxes are more important than less traffic, then the only other realistic choice we have is to acknowledge that greatly increased traffic is an unfortunate but inescapable consequence of our astonishing economic success. While many long-time residents can remember when traffic wasn’t much of a concern, and while others have moved to Jackson Hole to get away from the types of problems exemplified by traffic jams, the reality is that today’s traffic is part of the price we’re paying for our economic vibrancy. And if we don’t want to buy our way out of those problems, recalibrating our traffic-related expectations may be our only other alternative.

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To contact us, please call (307) 733-8687, or e-mail js@charture.org

CoThrive: Addendum

To produce pieces like The Jackson Hole Paradox, I start with basic research.

Sometimes such research proves to be profoundly meandering and excruciatingly inefficient, especially when it takes me down data-mining cul-de-sacs that don’t prove useful. More often than not, though, my research produces little nuggets I find really interesting, but which don’t neatly fit into what I end up writing.

This need to edit was a real problem when I was writing for the Jackson Hole News&Guide, because columns were so space constrained that I invariably left at least a few interesting snippets on the editing room floor. Because the blog format allows me more room, however, I thought I’d use addenda like this to include items that strike me as interesting, but don’t naturally flow into the final cut. In this case, as I researched jobs I came upon the following.

New York City has about three times as many jobs per resident as does the US. Teton County, Wyoming has about twice as many. This wasn’t always the case, though.

As Figure 2 shows, on a per capita basis, Teton County’s job situation really shifted in the 1980s. Up until 1980 or so, per capita jobs grew at a steady pace. After leveling off in the early 1980s, the per capita job number skyrocketed, growing from 0.82 in 1982 to 1.23 in 1990. Then, save for the recession, things continued their pace of slow-but-steady growth.

What happened? As Figure 3 shows, the answer lies not in the numerator (i.e., the number of jobs), but in the denominator; i.e., Teton County’s population.

In 1982, Teton County’s population totaled 10,653, its highest ever to that point. Starting in 1983, though, the population began declining, and would not return to 1982’s level for seven years.

In 1990, Teton County’s population went above 11,000 for the first time. The 1990 total of 11,328 means that, on a compounded basis, Teton County’s population grew just 0.8 percent/year between 1982-1990. In contrast, during that same eight year stretch, the number of jobs in Teton County grew from 8,650 to 13,924, a compounded annual growth rate of 6.1 percent.

As the 1990s began, Jackson Hole entered into its current post-tourism economic era. In fact, 2016 marked 30 consecutive years of population growth for Teton County. Even more remarkably, with the exception of the two immediate post-recession years of 2009 and 2010, the number of jobs in Teton County’s has grown every year since 1969.

Put another way, barring a catastrophic occurrence in the last five months of this year, 2019 will mark the 48th year in the last 50 that Teton County’s job market has grown. In contrast, in that same 50 year stretch, the United States has seen job declines five separate times.

Before 1990, Teton County’s economy was deeply dependent upon tourism, a reality best exemplified by the fact that, in the mid-1980s, Teton County’s leaders were so concerned about local tourism’s future that they lobbied Wyoming’s legislature to create the state’s first-ever lodging tax.

In 1990, though, construction surpassed government as Teton County’s third-largest job-creating industry. And by the end of the 1990s, the number of jobs in the Finance, Insurance, and Real Estate sector (FIRE) eclipsed those in government. Viewed another way, as late as the mid-1970s, Teton County has more jobs in agriculture and government combined than we had in construction, finance, and real estate combined – more ranchers and rangers and lawmen, if you will, than nail-bangers, bankers and real estate agents. By 1990, that had changed, creating a different take on “The Last of the Old West.”

The data also reveal another fascinating shift in Teton County’s economic history: the increasing importance of self-employment.

In 1969, 83 percent of Teton County’s jobs were wage and salary jobs, with the remaining one-sixth held by self-employed people (many of whom were ranchers). Jump ahead a generation, and that ratio really hadn’t changed much: in 2000, 78 percent of the county’s jobs were still wage-based (although there weren’t too many ranchers left).

Since 2000, though, the percentage of wage-based jobs in Teton County has fallen sharply, from 78 percent to 66 percent. As a result, today fully one-third of Teton County’s jobs are held by self-employed folks.

The fact that 34 percent of all Teton County jobs are held by entrepreneurs puts Teton County in the top six percent nationally. What’s really striking, however, is that, on a per capita basis, over the past ten years Teton County’s number of self-employed jobs has been the nation’s highest.

Unfortunately, the data don’t reveal the breakdown of those self-employed jobs by industry. But they do tell us that, in 2017, there were 0.48 self-employed jobs for every resident of Teton County. Meaning that, on average, if two years ago you weren’t working a self-employed job, either your spouse or your neighbor or your buddy was.

Given those numbers, it’s no surprise that efforts such as Silicon Couloir, Pitch Day, and other facets of our growing entrepreneurial ecosystem have been so favorably received. The market is clearly there.

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