Customers who enter The Artifactory, a jewelry and gift store located in West Lebanon's PowerHouse Mall, often ask owners Arnie and Anne Brown the same thing: how is their business doing? Although sales are down 13 percent from last year, Arnie Brown said he always replies with a sense of humor.
"Well, we're doing better than General Motors," he said.
With the country in the midst of an economic crisis, businesses in the greater Lebanon, N.H. area are reporting lower sales and fewer customers. Yet many West Lebanon small business owners said they retain an underlying sense of optimism despite the slump.
Marc Milowsky, owner of the Blue Sky Restaurant Group, which includes Lui Lui Restaurant in West Lebanon and Molly's Restaurant and Bar in Hanover, said business remains strong in Lebanon compared to other parts of the nation because the Lebanon economy is centered around the College and Dartmouth-Hitchcock Medical Center.
"We're still waiting for the other shoe to drop, so to speak," Milowsky said, adding that his restaurants are experiencing some "softness," but have not experienced losses as severe as those suffered elsewhere.
An October 2008 survey by Forbes magazine found that Lebanon was the most financially secure town of 10,000 to 50,000 residents in the nation. Lebanon received the strongest ratings of any city in its category in areas including median income, poverty and education rates, Forbes reported.
The New Hampshire economy has also fared better than the nation's in general, with significantly lower unemployment rates. New Hampshire's unemployment rate, adjusted for seasonal variations, was 4.6 percent as of December 2008, while the United States as a whole had an unemployment rate of 7.2 percent, according to the New Hampshire Economic and Labor Market Information Bureau's web site.
The Lebanon economy "has not been affected by any drastic matter yet," Paul Boucher, CEO and President of the Greater Lebanon Area Chamber of Commerce, said in an interview.
While some businesses, such as the West Lebanon branch of Thermal Dynamics and FujiFilm Dimatix, have recently laid off large numbers of employees, upcoming infrastructure projects should boost the economy, according to Boucher. Calls to Thermal Dynamics and FujiFilm were not returned by press time.
Melissa Robinson, sales associate realtor at Lang McLaughry Spera Real Estate in West Lebanon, said that property sales, however, were down 10 percent in the last quarter of 2008. The average property price in the area was down 17 percent compared to the average price last year, she added.
Property also stayed on the market 22 percent longer in the fourth quarter of 2008 than in the fourth quarter of 2007, Robinson said. Declining property sales in Lebanon are a result of falling real estate values across the country, she said, as potential New Hampshire buyers may be unable to sell their homes elsewhere.
Lebanon Mayor Karen Liot Hill '00 said she is "hopeful" that the funding from the proposed federal stimulus bill will help alleviate the strain on the local economy. The amount allotted for New Hampshire public works projects, about $300 million, however, will be not sufficient, Liot Hill said.
"We could easily spend that in Lebanon alone," she said.
If New Hampshire does not receive enough money from the federal government, the state may have to raise the property tax, Liot Hill said. It is illegal for most state and local governments to run a budget deficit, she added.
"In a way, [state and local governments] are held to a higher standard -- we're held more accountable than the federal government," Liot Hill said. "So when the governor threatens to cut funding, we don't have anywhere to go. We don't have many choices."
Liot Hill looked to the financial state of the College and DHMC as major determinants of when Lebanon's financial difficulties may end.
"Our destiny in this very interdependent area depends on what goes on at the College and at the Medical Center," she said. "If the hiring freeze and job cuts are a one-time, short-term deal for the College and they're able to add people back next year, then we're very hopeful."
Several business owners who wished to remain anonymous because they feared their comments could negatively affect their businesses said that "doom and gloom" news reports only serve to make people feel guilty about shopping in public and drive them away from spending money in local economies to shopping online.
"We're a resilient country -- certainly this is a test of our mettle," Milowsky said. "Maybe I'm just a glass-half-full kind of guy, but I think that we're going to come out of this a lot wiser and a lot more informed about what our government is and isn't doing."
