Ashland, Medford see decline in new business licenses

Applications for new business licenses have stair-stepped down over the past three years in Medford and Ashland.

While the downward trend isn't surprising, the incremental uniformity in Jackson County's two largest cities indicates it might be awhile before previous levels are regained.

The Medford Finance Department issued 1,303 new business licenses — separate from renewals — for the fiscal year ending June 30, 2007. The number dropped 3.6 percent to 1,256 the following 12 months. For the fiscal year which ended last month, the city saw a 9.1 percent decline in new licenses, down to 1,142.

Medford Deputy City Manager Bill Hoke said there are a variety of reasons for the decline in start-ups, with the inability to secure funding for new launches a key contributor.

"Money is tight," Hoke said. "People are already stretched and they're afraid to expand in a sinking market. Even though there is a glut of labor, is it the right labor? The other side to it is if you are relocating, they can't get rid of what they have where they are."

Hoke said the city doesn't break down the numbers looking for underlying trends.

"We do an anecdotal analysis, seeing what history tells us and observe the present," he said. "The way I see it, credit is just so tight; some people are living off their reserves until things pick up. They're hunkering down because there is no certainty. Even risk-takers are being cautious."

Ashland, which tracks business licenses on a calendar year, signed off on 398 new requests in 2006. In 2007, the figure dropped 13 percent to 346. Last year, Ashland issued 303 new business licenses, a 12.4 percent dip.

Although inquiries about relocating businesses have remained consistent throughout the economic downturn at Ashland Chamber of Commerce, the follow through has been slower.

"It's like planting a tree in the winter," said Katharine Flanagan of Ashland Chamber of Commerce. "We've maintained a steady average of folks relocating business here, but it's a major process. Everybody begins the journey at a different point. The barriers might be U.S. citizenship, an OLCC (Oregon Liquor Control Commission) license, a store front, permits for remodeling or a new building. It all takes time and money and that's where the economy might put a strain on turning desire into reality."

The resulting decline in revenue for cities — a basic commercial license is $100 in Medford — isn't lost on Brad Hicks, president and chief executive officer for The Chamber of Medford/Jackson County.

"While entrepreneurship tends to thrive when unemployment is high, these unusual times see budding businesses putting the brakes on all types of spending, including business licenses," Hicks said. "I know that business licenses are usually a city's most cyclical income source, but I also know our city budgets well and will be prepared if those numbers continue to decline."

One brighter spot in business-license requests was reported in the valley, but with an asterisk. After a drop in 2008, Central Point saw a minor uptick in new business licenses. A City Hall spokesperson, however, attributed the increase to "more aggressive enforcement" rather than any business surge.

While there might not be a large flow of new businesses, some of the existing ones are creating additional work for staffing companies.

Nikki Jones of Express Personnel on O'Hare Parkway in Medford said larger manufacturing employers are requesting fewer workers for shorter periods.

At the same time, the glut of job-seekers has caused smaller businesses or start-ups to seek hiring help.

"Some of our new business is coming from companies overwhelmed by job-seekers," Jones said. "Some employers don't have time, experience or energy to deal with it. They'll say 'We tried to do it on our own, will you do it for us?' "

Reach reporter Greg Stiles at 776-4463 or e-mail

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