The March sales tax numbers could have been a fluke. Sure, Columbia, was up 1.9% versus March 2019, but the figures only represented part of the first month when coronavirus-related restrictions were in place. The smart approach was to wait and see until April before drawing strong conclusions. April was the height of the shutdown and a time when the U.S. economy as a whole was laying off a record number of workers.
Well, the Mississippi Department of Revenue released the April sales tax receipts this week, and the news keeps getting better for the City of Charm on the River Pearl. Columbia’s sales tax figures actually increased 4.1% during what will probably go down as the worst month for the U.S. economy since the Great Depression.
How did it happen?
Of course, there are countless factors, and it’s difficult to say for sure that any one of them played the biggest role.
Sure, nearly all residents received the $1,200 stimulus checks, and people who lost their jobs got the $600 per month federal unemployment insurance on top of the normal amount received through the state unemployment program. But every city in Mississippi benefited from those programs roughly equally, so federal subsidies are unlikely to account for differences between cities. Overall sales in the state were down 7.5%, too, which means that federal help alone wasn’t enough to offset the economic damage caused by the virus response.
Here’s my theory: Columbia’s relative lack of extra rules about the COVID-19 outbreak compared to Hattiesburg played the biggest part. Columbia Mayor Justin McKenzie did not impose additional requirements beyond those placed by Gov. Tate Reeves, while Hattiesburg Mayor Toby Barker did. Barker gave an order in late March that limited the number of customers at businesses like grocery stores and pharmacies and closed certain non-essential establishments until at least April 30, according to reports from the Pine Belt News. Then on April 8, Barker started requiring all employees at Hattiesburg businesses to wear face masks, among other things.
It’s beyond the scope of this column and my scientific knowledge to debate the health care merits of such policies, but I will note that cities like Columbia, which was following the state’s guidelines for social distancing and restrictions of non-essential businesses while not adding anything extra to what the state dictated, did not see catastrophic spikes.
Regardless of the health care merit of coronavirus restrictions, they did have an indisputable economic impact. Hattiesburg sales fell 17.8% in April.
Meanwhile, nearby cities with a significant retail presence did well. In addition Columbia’s 4.1% growth in April, Petal rose 8.3%, Purvis rose 19.4% and Sumrall 10.1%.
I think the rising sales in April in Columbia and cities like it shows that residents stuck at home rather than driving to Hattiesburg to shop. That illustrates, in a rough way, the amount of business that small towns lose to their bigger counterpart.
The bigger cities certainly had a rougher deal than rural towns. They have more large gatherings where the virus could have spread quickly, and their economies have more out-of-town shoppers and tourists and even college students, who were home in April, than a rural community that mostly serves its own folks.
I don’t want to dismiss the threat of the virus either, which has now killed more than 116,000 Americans in a few months and has not abated yet in this country like it did after a few months in other places. Columbia has not taken the virus lightly, I don’t think, with restaurants closed for a long time, social distancing stressed and schools, churches and other large gatherings closed, as per the state guidelines. But I think the path of less restrictions has proved in this case to have not exacerbated the health risks while adding some balance to the economic concerns.
For once, Hattiesburg’s loss has been Columbia’s gain.
Charlie Smith is editor and publisher of The C-P. Reach him at (601) 736-2611 or csmith@columbianprogress.com.
