It's nice to see the sun after so many days of dreary gray clouds and fog. I notice that everyone over in Ocean City seems to be getting ready for the summer season; fixing up all the stores and hotels and generally sprucing things up. It's good to see.
But what kind of season is it going to be? It seems to me that there are a number of factors which might combine to make the season less successful than usual. First and foremost, of course, is the price of gasoline.
The price of gasoline in Maryland and nationwide continues to rise and has reached a point where it is actually starting affect demand. Almost everyone who vacations in Ocean City reaches there by car. As the cost of gasoline rises, the cost of getting to Ocean City and back also rises.
But more importantly, the increase in the cost of gasoline is straining middle class family budgets. Sure, a 300 or 400 mile round trip to Ocean City will consume a fair amount of gas, but many families are traveling that far every week just to get to work and back. In addition to gasoline, families are also paying higher costs for electricity, food and a variety of other things.
The reality is that the real income of many middle class families - the bread and butter for Ocean City - has declined over the past several years. In a recent survey by the Pew Research Center more than half said they had had to cut spending because money was tight. Fifty-four percent of middle-class respondents said that they had lost ground economically over the past five years.
Some say that people will respond to high energy prices by vacationing close to home rather than taking longer trips and that such a decision would help Ocean City because it's close to several major metropolitan areas. But I think it's just as likely that people will vacation at home or cut their vacations short - going away for three or four days rather than a week or two. There's already evidence that many visitors to Ocean City are coming for shorter periods instead of the one or two week vacations of the past.
And then there's the cost. The price of lodging in Ocean City has skyrocketed over the past several years as the price of real estate reached stratospheric levels. Of course, real estate prices have dipped over the past year, but I haven't seen any evidence that rental prices have dropped. Indeed, the Ocean City town fathers, in their wisdom, decided to increas the room tax this year so they could advertise in additional markets.
Then, of course, there's the shortage of H2B visas for temporary workers. While this won't affect most businesses - the exchange students here on J1 visas will still be here in great numbers, it will have an effect on certain large employers.
New fishing restrictions will also have a negative effect. And the cost of fuel for the long fishing trips out to the gulf stream will sharply increase the cost of those trips. While the effect here may be marginal, it is the cumulative effect of all of these factors that we need to keep an eye on.
So let's hope the price of gas is contained, that people in the DC/Baltimore/Philadelphia area feel a need to get away to the ocean this summer and that the cost of lodging in Ocean City trends down a bit. Because a bad year for Ocean City would also be a bad year for all those who depend on the summer season for their jobs and income.
[The picture is of a gasoline rationing coupon that was printed by the government as a standby measure for the gasoline shortage of the late 1970s but was never used]
