DOVER — Vermonters are experiencing these rough economic times, with the Vermont Department of Labor reporting 25,200 unemployed in February, 100 more than in January and a full 9,600 more than one year ago.
Vermont's ski industry, for the most part, is holding its own.
With more than 8 feet of snow recorded at the National Weather Service station in South Burlington, Parker Riehle, president of the Vermont Ski Areas Association, says the 2007-2008 snowfall translated into a busy ski season. Riehle said there were 4.3 million skier visits in Vermont last year, making it one of Vermont's top ski seasons of the last ten years.
The VSAA will release the 2008-2009 skier numbers in June, and Riehle believes that given the amount of snowfall in 2008-2009, he may see similar results.
Mount Snow Chamber of Commerce executive director Laura Sibilia said the local economy is reliant on the weather. The winter holidays - Christmas, New Year's, Martin Luther King Day, and Presidents' Day weekends - translate into the busiest time of the ski season, and ski resorts depend on these holidays to make the most money.
Sibilia recalls the 2006-2007 ski season as one of the warmest in years. She said business levels in the Deerfield Valley were down anywhere from 10 percent to 80 percent, depending on the type of business. But because the Deerfield Valley is predominantly a tourism-based economy, good weather brings in visitors and bad weather will keep them indoors, regardless of seasons, she says.
“When we have thunder and lightening at the Fourth of July fireworks (like in 2006 and 2007), attendance was down. When we have beautiful weather on the Fourth (like we did in 2008) attendance at events can literally be double that of bad weather years. In a manufacturing town, the weather doesn't matter,” said Sibilia.
“The adage of great snow trumping the bad economy was just as true this year as it has been in prior years during bad recessions,” said Riehle. “If you look at prior recessions you'll see whenever there is great snow, the ski industry does quite well.”
The same can be said about Mount Snow ski resort in West Dover. Owned by Peak Resorts, of Wildwood, Mo., Mount Snow had a busy ski season despite the rough economy.
Mount Snow general manager Kelly Pawlak said ski areas are dependent on favorable weather conditions and less so on the economy. “It's just like the beach. You don't go when it's raining. I honestly think it's location and weather. If it didn't snow this year, we would be having a tough year and we'd be blaming it on the economy,” said Pawlak.
Surrounding towns and villages also depend upon the ski resort's business. Riehle said that in an average year, skiers and riders spend up to $750 million in Vermont throughout the course of a ski season. Two-thirds of those expenditures occur off mountain in surrounding villages and towns, local hotels, art galleries, and retail stores. When ski areas experience poor weather conditions, so do nearby towns and villages.
“It hits on all aspects of the retail community throughout Vermont,” said Riehle.
Pawlak agrees with the idea that if Mount Snow struggles, then so does the community, and one can't function without the other in the ski business.
“We're joined at the hip with the towns. We can't survive without all those properties providing amenities,” said Pawlak. “So whether you're a carpenter making second homes, delivering wood, or making repairs, when people come, you're busier. When they don't, we sit around and figure out what we do with our time. It affects everyone.”
Despite the good ski season, Vermont ski areas do feel some of the effects of the national economy. Several ski areas are facing rising costs of electricity, diesel fuel, insurance and vendor services. Costs aren't getting cheaper, and when those factors are aggravated by the economy, they impact a ski area's bottom line.
“There's aggressive across-the-board skier reduction policies right now. Resorts are going out of their way to come up with affordable ticket prices. It's less revenue against increased prices across the board, and it makes profit margins all that much more precarious,” said Riehle.
Pawlak says Mount Snow's expenses also eat into their profit margin. If the economy doesn't improve, Mount Snow may see a decrease in season's pass sales for 2009-2010. If that happens, local businesses such as lodging and real estate might also take a hit and have a ripple effect in the rest of the community.
However, this year's snowfall still trumps the poor economy, Pawlak said. If the season turned out differently, Mount Snow would be facing a much different situation.
“We're keeping our eye on the situation because last year, people already committed to seasons passes prior to the recession. Now I'm starting to hear stories [of people] being laid off after 22 years from Wall Street," Pawlak said. "Others are saying 'we're cutting back on vacations.' It could be very different for us next year.”
“The ski industry, like any other business, has huge expenses. This year we were lucky because it snowed and we were able to maintain the revenue for the most part in a lot of areas. The good weather and snow always help,” said Pawlak.
Riehle couldn't agree more. “Although this is the mother of all recessions and probably the worst since the Depression, it's not the first time that we've been able to see how snow makes up for a bad economy and keeps riders and skiers coming to Vermont.”