Learning About Our Community: Our Local Economy

The Comprehensive Plan's Existing Conditions Report gives insights on the local economy

As part of their work in developing our community’s next Comprehensive Plan, American Structurepoint, the plan’s consulting firm, has developed a Draft Existing Conditions Report. This report goes into detail into many of the aspects of the community. In a previous edition, this publication tackled the data in the chapter dealing with demographics.

Today’s topic will cover the city’s economy.

Overall, American Structurepoint discovered that the community has demonstrated a resilient and diverse economy, fostering an environment conducive to both large and small businesses. The local economic framework, primarily bolstered by key industries such as manufacturing, healthcare, and retail, exhibits strong growth patterns and proactive development initiatives. The consultant’s analysis is structured around several core economic dimensions including employment trends, industry distribution, economic development initiatives, and housing impacts.

Where We Work

Troy's employment landscape is robust, with 16,773 individuals employed within the city, representing 35% of all jobs in Miami County as of 2021. The city hosts over 1,000 businesses, including facilities for major corporations like Conagra Brands and American Honda Motor Company, which coexist with local ventures such as restaurants and boutiques.

Significantly, manufacturing emerges as the largest employer, accounting for 26.3% of the workforce, followed by retail and healthcare, which represent 11.9% and 11.5% of employment, respectively. This industrial diversity not only stabilizes the local economy but also mitigates the risk associated with economic downturns in single sectors.

A History of Supporting Commerce

In addition to creating a diversified economy, the community has leveraged various development incentives to stimulate growth and investment. This has long been a part of the city’s culture, even back in the 19th century. It was back in the 1890s, when civic minded leaders bought a few vacant parcels on Western Avenue (now called South Ridge Drive) to lure a company named Hobart from nearby Middletown.

Currently, the Community Reinvestment Areas and the Enterprise Zone programs are prime examples, offering tax abatements and other incentives to encourage both new construction and property improvements. Furthermore, the Tax Increment Financing (TIF) districts facilitate shared infrastructure costs, thereby fostering more commercial and residential development.

The city's proactive stance is also evident in its support for small businesses through the Economic Development Revolving Loan Program, which provides gap financing to enhance cash flow and financial stability for smaller enterprises.

The Link between Housing and the Local Economy

The housing market in Troy has seen substantial growth, with the total housing supply reaching 12,333 units by 2023, a steady increase from previous decades. The availability of diverse housing types is critical in supporting the city's economic fabric by accommodating a growing workforce and attracting new residents.

Moreover, the integration of housing with economic development strategies is clear in Troy's approach to housing affordability and availability, which supports the workforce's needs and contributes to the city's overall economic health.

Troy’s Retail Environment

Troy's retail environment exhibits a blend of challenges and opportunities. The primary and extended trade areas show significant leakage in retail spending, suggesting that residents often shop outside the city for goods and services. Addressing these leakages by enhancing the local retail offerings could retain more consumer spending within Troy, benefiting local businesses and the overall economic landscape.

Challenges and Opportunities

Workforce Development

One of the critical challenges facing Troy is the alignment of workforce skills with industry demands. Despite a strong presence of manufacturing and healthcare industries, there is a noticeable gap in the availability of skilled labor in these sectors. The local educational and training programs may not fully meet the evolving needs of these high-demand industries, potentially leading to a mismatch between job vacancies and qualified applicants.

Additionally, the low unemployment rate, while generally positive, has created a highly competitive job market. Local businesses find it increasingly difficult to fill open positions, especially in specialized roles that require specific technical skills. This labor shortage can hinder business expansion and may force companies to look elsewhere to satisfy their workforce needs.

Infrastructure and Transportation

As the community continues to grow, the demand on its infrastructure also increases. The city's transportation network, utilities, and public services must evolve to keep pace with this growth. Increased traffic and wear on roads from commuting patterns that see a significant portion of the workforce coming from outside the city can lead to congestion and increased maintenance costs. The need for improved public transit options and road expansions is apparent to facilitate easier commutes and support the influx of new residents and businesses. There is also a growing demand for increased bicycle and trail infrastructure to better link parts of the community.

Moreover, the city’s proximity to major highways is both an asset and a challenge. While it provides excellent connectivity to larger markets, it also requires substantial investment in maintaining and upgrading these key transport routes to ensure they can handle increased traffic volumes without becoming congestion points.

Technological Change

The rapid pace of technological change presents another challenge for the community’s economy. Industries such as manufacturing and retail are particularly susceptible to disruptions from new technologies like automation and e-commerce. Local businesses must adapt to these changes by investing in new technologies and training their workforce to handle new systems and processes. This adaptation requires significant capital investment, which can be a substantial burden for small to medium-sized enterprises.

The shift towards more online shopping has also impacted local retail businesses, with many consumers opting for the convenience of online platforms over traditional brick-and-mortar stores. This trend contributes to the retail leakage observed in the city, as local businesses struggle to compete with national and global e-commerce giants.

Addressing the Challenges

To address these challenges, Troy needs a multi-faceted approach that includes enhancing workforce development programs, investing in infrastructure upgrades, and supporting local businesses in technology adoption. Partnerships between local government, educational institutions, and industry leaders could lead to more effective training programs tailored to the specific needs of Troy’s key industries.

Investment in infrastructure, particularly in transportation, will be crucial to support both current and future economic activities. Initiatives to improve road conditions, expand public transit options, and enhance digital infrastructure could significantly alleviate some of the logistical challenges faced by the community.

Finally, fostering a supportive environment for businesses to embrace technological advancements will be vital. This could involve financial incentives for tech upgrades, workshops on digital tools for small businesses, and community-based strategies to boost local retail.

Conclusion

The City of Troy's economy is marked by a strong industrial base, significant employment opportunities, and strategic economic development initiatives. These elements are supported by a housing market that needs to continue to align with the needs of a diverse workforce, facilitating sustained economic growth and stability. The city's ability to attract and maintain a wide range of industries, from manufacturing to healthcare, alongside its focus on economic incentives and housing development, positions Troy as a resilient and thriving economic hub.

This detailed examination of Troy's economy from the provided report underscores the city's strategic approaches to fostering economic growth and sustainability. The comprehensive analysis in the Existing Conditions Report reflect a community poised for future prosperity, driven by thoughtful economic planning and community-oriented development strategies.

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