While some business owners predicted a bleak summer season on the Vineyard due to record high gasoline prices and a sagging national economy — an outlook made worse by the devastating Fourth of July fire in Vineyard Haven — the mid-term economic report card for the season has so far been a mixed bag.
As is the case almost every summer, business this season is either up or down or about the same — depending on who you talk to. “It’s down, way down. This is one of the worse seasons we’ve had,” said Judy Hartford, co-owner of the Red Mannequin in Oak Bluffs and Yes We Have No Bananas Gallery in West Tisbury.
“Overall we’ve had a solid season,” countered Christian Thornton, owner of Atria in Edgartown. “We have actually seen slight gains this year.”
Early reports from Vineyard Haven, which was devastated by the Independence Day fire that completely destroyed Café Moxie and badly damaged the Bunch of Grapes Bookstore, shutting it down for at least a year, have also been mixed.
Ken Soules, manager of Island CD on Main street, Vineyard Haven, said business is off from last year.
“We were already in trouble with gas prices and the recession, but the fire obviously had the biggest impact on us,” Mr. Soules said. “We always had a lot of spillover from [Bunch of Grapes]. The same people shopping for books also shopped here. It’s a ripple effect.”
But Tamara Weiss, owner of Midnight Farm on Water street in Vineyard Haven, said business has been better than expected. “I’m surprised really . . . with the economy and the fire, I thought it was going to be worse. We are about the same as last year — which all things considered is pretty good,” she said.
And while reports may vary, two consistent themes emerge this year. First, there appears to be an increase in international visitors, likely due to the weak American dollar in European markets.
And second — the people are here, they are just spending less.
“It seems we have the same amount of people . . . they just aren’t buying as much,” said Marshall Pratt, manager of Trader Jacks on Circuit avenue in Oak Bluffs.
“People are finding cheaper ways to the enjoy the Island,” agreed Chris Wells, president of the Martha’s Vineyard Savings Bank. “Instead of going shopping they are spending a day at the beach.”
Figures from the Steamship Authority show the number of people arriving on the Vineyard has in fact increased from last year. Through last Monday, passenger traffic was up from 1,036,674 last year to 1,082,687, an increase of 4.4 per cent. Automobile traffic is also up, from 104,893 to 109,777, an increase of 4.7 per cent.
Real estate brokers who handle rentals say the summer rental market is strong and getting stronger. Anne Mayhew, rental manager for Sandpiper Realty in Edgartown, said rentals were flat for June but are projected to be up for both July and August.
Jeff Talmadge, who owns the popular Web site WeNeedaVacation.com, which matches vacationers with homeowners, said Vineyard rental bookings from mid-June to mid-September are up 8.7 per cent this year. But Mr. Talmadge said he too has heard that people are spending less once they arrive.
And there are quiet spots, considering that it is midsummer.
A call to Farm Neck Golf Club yesterday at 3 p.m. revealed multiple tee times available within the hour. A drive by the Joseph Sylvia State Beach between Edgartown and Oak Bluffs around the same time showed large gaps of available parking on a sunny afternoon.
Throughout the week, parking spots were available in all three down-Island towns and tables were available at most restaurants. Edgartown harbor master Charlie Blair said a set of first-come, first-serve moorings in the town harbor — normally booked all summer — have been open for long stretches.
“There’s nobody in the Sound,” Mr. Blair said.
Sean Flynn, manager of the Martha’s Vineyard Airport, said the airport has yet to compile statistics for flights in July, but he said overall it appears that volume is down. “I would have to say it’s an off July — what that means for August or the shoulder season is hard to say,” he said.
Mr. Wells said deposits from businesses are down and core deposits and balances for average household accounts are also lower then usual.
“There is a lot more window shopping this year, people have less disposable income,” he said.
But he also said taking the temperature of the summer season in July can be misleading. He said a strong August can always save a business that had slow months in May and June, and he noted that in recent years the season has extended well beyond July and August.
“It used to be the season went from the Fourth of July to Labor Day — but for a while now the season has been from Memorial Day to Columbus Day. It used to be the make-or-break month was August, but for a lot of [owners] the best months are now September and October,” he said.
A recent economic profile of the Island prepared for the Martha’s Vineyard Commission confirms the trend of a more prolonged shoulder season.
Mr. Talmadge agreed the increased value of foreign currencies has provided a boost to the economy.
He also speculated that higher gas prices may actually be a boon to summer business.
Mr. Wells said there are reasons to be concerned about the Vineyard economy. The cost of living remains high while wages have remained relatively the same. This has caused many people to dip into their savings or rely on credit cards to make ends meet. Overall, however, he predicted the Vineyard economy will remain healthy.
“Our natural resources will always make us marketable and attractive to people planning their vacations. What we have to offer you can’t find everywhere . . . this is a special place,” he said.
Art Smadbeck, an Edgartown selectman and partner in the real estate firm Priestley, Smadbeck and Mone, is also optimistic about the long-term prospects for the Vineyard economy.
He said the Island in recent years has shifted from a seasonal to year-round economy.
“It used to be the place didn’t get busy until May, but now you feel that energy start to happen in April and even March, and by the time you get to Memorial Day it’s like a heart beating faster,” he said.
The commission economic report shows that while there is growth in the year-round economy, Island businesses still make the vast majority of their money during the busy summer months. Taxable food sales in the months of July and August, for example, accounted for just under 50 per cent of sales for the entire year. The study also found that year-round residents account for only 25 per cent of the sales on the Vineyard through the year; 33 per cent of sales were from vacationers, 32 per cent were from seasonal residents and 10 per cent were from day visitors.
“[Since 1980], the Island has developed two overlapping economies: one to serve the growing population of vacationers and one to serve the year-round population . . . the key challenges facing the Island’s economy over the next 50 years include diversifying the economic base to include more non-vacation related professional services that can be exported off-Island; and expanding efforts to retain and circulate more local earnings on-Island,” the report said.
Many agree that continued dependence on the summer season — coupled with variables like the national economy and local disasters like the Fourth of July Fire — make it hard to identify long-term economic trends on the Vineyard.
“The only thing you know for sure is the season is unpredictable,” said Cheryl Stark, owner of CB Stark jewelry in Vineyard Haven.
“One day can be slow, the next day extremely busy . . . that’s the summer season on the Vineyard.”
Ms. Stark said she has noticed one trend in recent years: high-end businesses tend to do well even if the national and local economy takes a downturn.
Mr. Wells agreed.
“I believe there is this sort of billionaire effect on the Vineyard — people who have big homes who bring their own chefs to cook their meals.
“An increase in [the cost of] gas or a bad economy isn’t going to stop them from coming here and spending money,” he said.
Mr. Smadbeck acknowledged there may be a trend toward more high-end businesses around the Island, such as the new members-only Boathouse and Field Club currently being built in Edgartown. But he said overall this is good for the economy.
“Anytime there is a need for something on the Vineyard, there is an entrepreneur who will find a way to fill it . . . if someone wants a club with a tennis court and a swimming pool and a private restaurant, these people will stick their necks out and try to provide a service people want. It’s no different with a T-shirt shop or an ice cream parlor,” he said.