When bust means boom: Industries unscathed by bad economy

Published 11:30 am Friday, March 13, 2009

By JENNIFER MORRIS and TARA LEMM

Staff Writers

KITSAP COUNTY — The nation’s job report is grim: an 8.1 percent unemployment rate, 651,000 jobs lost in February and since the recession began 4.4 million jobs now obsolete. The labor market’s pain is predicted to continue into 2010. It is an unnerving report card, but despite the troubles, some sectors continue to be strong, while others are spurred to success by the troubled economy.

Staff writers Jennifer Morris and Tara Lemm took a look at 10 industries in Kitsap enhanced by the fledgling economy.

The Bankruptcy Busters

Who ya gonna call? For an increasing number of Kitsap residents, the answer is: bankruptcy lawyers.

The economic tornado has resulted in job security for the area’s bankruptcy attorneys, but it’s a security they’d rather do without. Kevin Moran, who’s handled all bankruptcy cases for Bennett Rainey Moran Gianneschi and Clucas for the last 10 years, noticed his case load began increasing late summer.

“By way of estimation, I was probably filing about three cases a month. Now I’m filing six to seven a month,” Moran said. “As you can imagine, anything that concerns the real estate market is what I’m seeing: a lot of small-business people. In the past, the primary source of bankruptcy filings were people who were over their head on credit cards or uninsured medical bills.”

Moran has always taken work home at night and over the weekend but nowadays he’s spending even more of his down time working to maneuver his growing case load.

Dale A. Magneson, attorney at law in Silverdale also noted an increase in business around the end of summer. He’s been a lawyer for 21 years and has recently experienced a record number of bankruptcy filings.

“A little over a week ago I filed a total of nine bankruptcy cases in one week. That’s a personal record,” he said. “There’s a significant uptick in filings, a significant uptick in people finding there’s no other place to turn.”

A rise in bankruptcy filings isn’t shocking, but what’s troubling is a bankruptcy lawyers’ ability to help.

Magneson said in the past he was able to clear the dischargeable debt, allowing people to start over and move on. Now, it’s a different story.

They can alleviate debt through bankruptcy but with it goes the house. People are also losing hours at work, and sometimes even the medical benefits that accompany fulltime jobs.

“We can’t save people from those situations,” Magneson said. “We really want to help but it’s just not that way anymore.”

Moran spends almost eight hours a day listening to the stories of those who were living the American dream, who’d been in business for more than 20 years and responsibly managed their finances, to helplessly watching everything implode around them.

“It’s very trying emotionally. There’s just a lot of sad stories out there. It gets to you,” Moran said. “I try to give them some plan for relief. I try to help and that’s the only way I can sleep at night.”

The Parts Peddlers

In times when just about anyone is searching for new ways to stretch the almighty dollar, vehicles, too, are being pushed to the limit. Rather than cutting ties with old autos and hitting up dealerships, many are pushing their rusty Datsun dinosaurs as far as the wheels will take them.

While new car sellers see a major decline, car shops and parts dealers — especially those with discounts — are getting some economical love.

At Yank-A-Part, North Kitsap’s self-help auto wrecking yard, there are heaves of metal, countless motor parts and hundreds of decommissioned vehicles. Stashed neatly in rows, some bear bumper stickers from owners past, while others sit hood ajar, as if caught mid-conversation.

Chevys, Hondas, Fords and more line the 10 acres like a ragtag brigade of reusable potential.

At the front counter, Doug Smith tends a ringing phone.

“People are trying to keep their old cars going,” he says.

That’s clear, from the near 20 percent increase in Yank-A-Part’s sales and upsurge in repeat customers.

Smith says the shop has seen steady growth since October, even adding a seventh day (Sunday) to its hours of operation to meet the growing demand.

“You see a lot of people that normally wouldn’t come to wrecking yards come to wrecking yards,” he said. “People are cutting corners wherever they can.”

And Yank-A-Part is a good place to do it: Batteries can be purchased for half or less of their normal price. Smith said normally he sees 40-50 on the shelf; now there are 10.

“When wintertime hit, theywere just flying out the door,” he said.

Something similar goes for Kitsap Tire Center, where owner Rus Ferguson said the call for used tires has shot to new heights.

At 10 a.m. on a Monday morning, the center’s main lobby was lousy with activity: two employees dealt paperwork behind the counter, Ferguson chatted with a customer about savings and somewhere a phone rang.

Already that day Ferguson received two calls for used tires — the rise, he said, has been noticeable.

And while the center itself is still working hard to maintain its existing employees, other trends have become more prevalent.

“If people have cars that are fatally broken or expensive to fix, they just walk away from them,” he said. He noted one woman, who couldn’t pay for her car’s needed repairs, simply left it at the shop.

Others have been asking to buy their own parts for the center to use, presumably ones purchased at places like Yank-A-Part, where they can be bought on the cheap.

Though at Kitsap Tire it’s not allowed, because, as Ferguson said, the work couldn’t be guaranteed.

Health Helpers

The nation’s economic struggle is rearing its ugly head on household and business finances. Less tangible is the toll its taking on an individual’s emotional and mental ability to cope.

“Our case loads are increasing and it’s of grave concern,” said Rochelle Doan, Kitsap Mental Health Services (KMHS) director of community relations.

According to information provided by Doan, calls to the Crisis Clinic of the Peninsulas increased 135 percent in 2008. The hotline serves residents of Kitsap, Jefferson and Clallam counties.

The last quarter of 2008 saw 2,422 callers; 256 of whom were given support to work through suicidal tendencies. In January 2009, 928 calls were received, compared to 692 calls in January 2008. In the region, calls for shelter alone are up from 484 in 2007 to 686 in 2008, and it’s anticipated 2009 will see an even greater increase.

What concerns Doan the most is the 35 percent increase in service requests for children and families.

“What we are seeing is an increase in serious depression, anxiety and post traumatic stress disorder,” Doan said. “What is different is that we’re seeing it in younger kids where we usually don’t see it to that degree. Last year we saw 1,215 zero- to 17-year-olds. That’s a significant number of children.”

KMHS is also experiencing an increase in requests for mental services from adults.

The alarming reality of mental health needs stems from more than just the numbers.

Doan said to receive help from KMHS people must meet a certain level of severity. But there’s a whole group of people calling for support who don’t meet the criteria, but are of grave concern to KMHS staff.

“Those calls are coming in and they’re increasing,” Doan said.

The Gold Mind

Gold is up. Really up. Since 2001, its value has more than tripled, flirting with just more than $1,000 an ounce earlier

this year. As people grow less comfortable with paper investments — stocks, bonds and the like — some are putting their proverbial eggs in baskets of a shinier nature.

“Historically, when the stock market goes down, metal markets go up,” explained Karin Christman-Stoner, co-owner of Silverdale’s House of Coins & Fine Jewelry.

The shop allows customers to convert money into gold, and deals in old rare coins from the American Gold Eagle and Canadian Maple Leaf to the African Krugerrand.

Christman-Stoner also takes scrap gold, as well as silver, often in the form of pieces fished from the bellies of jewelry

boxes of eras past.

“I think people are having fun with it now. They’ve been hearing so much hype on TV and cleaning out jewelry boxes and bringing in old scrap and it’s amazing what they’re getting out of it,” she said.

In times like these, someone could see a return of $50- $100 for an average gold ring, compared to the lesser earning of $20 they would have received upon hawking a few years ago.

For Christman-Stoner, this means a lot more buying and selling over-the-counter and fewer out-of-shop orders.

People are turning to gold, bullion and silver as the new international form of liquid cash.

“There’s a huge increase of people getting into the metal market,” she said. “When you watch your stock portfolio go down 75 percent or more, enough’s enough, theyre pulling out.”

House of Coins, in business nearly 30 years, is now taking other remnants of good economic days gone by, like one woman’s silver place setting, which she traded in for cash.

“It’s kind of sad to see that,” Christman-Stoner said.

The Board Game Greats

Remember the good ‘ol days when families turned to radio programs or reading aloud for entertainment?

Well nowadays families are gradually returning to their pioneer roots and turning an appreciative eye on board games for a night of fun.

It’s an inexpensive way to spend time together.

“Board games as a whole have gone up,” said Jason Rouse, manager of Bremerton-based Discordia Games.

He said before the shop used to sell maybe three board games a month, now they’re selling double and triple that, about six to nine per month. Rouse is ordering two board games a week whereas before he’d order maybe one a month.

“This year it’s completely different. Consistently every week I’m ordering some board game that just sold,” he said.

The most popular choice of family game is the Catan Series, which consists of four different games.

He said the series are very fun family games that can be played in an hour or less.

Interest in role playing and miniature games have also increased, and according to Rouse miniature games are by far the cheapest.

Rouse started to notice an increase in foot traffic — people he’d never seen before — about mid-November.

Rouse attributes the rise in game intrigue to the decline in economic stability.

“The talk around the store has been when it comes to the economy it is depressing and they need an escape. They just need to get away for a while,” he said. “Board games are quick and cheap to play. They can get away from reality for two to three hours and have some fun.”

The Debt Authority

In a warmly hued office above the clatter of Viking Way, SABA & Associates President Paula Bartlett explains the nature of her business. It does, after all, walk a fine line.

At SABA, debt collection is the duty — but, Bartlett explains, her company is one that veers from automated service to a more personal, comprehensive modus operandi.

“We’re getting people in collections that have never been in collections before,” Bartlett explained, her demeanor professional and kind. For the most part, she said SABA has seen a continuance of its habitual debtors, but recently some new names have come across their desks — especially those floundering in the construction industry. “We have to realize that they are a victim of the economic times. We do try to treat them a little more delicately, because they’re so devastated by the economy.

“… But we’re not wimps, don’t misunderstand,” she adds.

At SABA, just four collectors man the phones; it’s a relative small company in comparison to the 30-40 telephone jockeys typically found in collection agencies.

And while most view collectors from the perspective of the debtor (thus, giving them a rather Grim Reaper-esque appeal), Bartlett explained SABA’s work is done to the excitement and gratitude of businesses that, especially now, can’t afford to let invoices go unpaid.

“It’s a service that is necessary,” Bartlett said. “In these tough economic times, every penny counts.”

SABA serves more than 2,000 accounts across the state, from private individuals who have obtained judgements to “company’s as big as Costco,” Bartlett said. She takes on any kind of licensed operation, from landlords and dentists to dog groomers and daycare centers.

Judging by the numbers, she does it well: The American Collectors Association reported average collections of 16.1 percent in 2007, while SABA reached 41-42 percent. The company first sends a notice, then gives a phone call to its identified debtors.

“I think the key to successful collection is you need to have your facts before you make the phone call, and people need to be treated with dignity and respect,” Bartlett said. “We look at every single account as if it was owed to us.”

But she also reminds her employees they shouldn’t lose sleep over the nature of their job, especially in days when grief and suicide are often attached to financial woes.

“We take all of that into consideration,” said Bartlett. “I think there’s a fine line in running this type of industry.”

The Self-Improver

With so much televised doom and gloom, it’s little wonder many in this recession have taken to escaping the financial doldrums of reality — even at a bit of their own expense. Locally and nationally luxury businesses, like cosmetic spas, aren’t hurting quite like the rest of them. Sure, you may picture Hollywood’s “Nip/Tuck” here, but don’t think (it causes wrinkles, you know) that Kitsap’s North End isn’t reflecting the trend. At Wunderful Health in Poulsbo, procedures ranging from below $100 to upwards of $500 have seen an increase in sales.

“It’s all really picking up,” said owner Dr. Angel Wunder, seated on a plush waiting room bench, backed by the soothing sounds of a water fountain. “I think people are really tired of feeling this economic crunch, so they want to do things that are good for their bodies.”

And that goes from chiropractic visits and $70 massages on the incline — they reduce stress — to Wunderful Health’s forefront procedure: the Accent XL, a new thermotherapy technology from Alma Lasers that puts controlled heat therapy to use, fighting wrinkles, bulges and sagging skin. At $500 a session, this tool is earning itself repeat customers, pulling from the Seattle crowd and booking out weeks in advance.

“I think people want to do something for themselves that makes them feel better that’s not going to cost an arm and a leg,” explained Wunder. The Accent XL targets things even liposuction can’t, she added. Surgical procedures not only start around $8,000, but they come with hefty recovery time, and now isn’t the optimum moment for many to be putting their jobs on the line.

Both men and women from their mid 20s to their 70s have taken to the Accent XL, and its near-instant gratification results, so much so that Wunderful Health now takes appointments on Tuesdays to accommodate the increased customer flow. Wunder said the Accent XL’s price keeps it within the average consumer’s range, which is a plus, she added, as now more than ever people are learning what it means to be healthy and are thinking ahead to the future.

“What they (Accent XL users) are saying to us is they finally feel like they found something where before there wasn’t a solution,” she said. Her business is also adding Joanne Victoria to its team as a life coach, specializing in career, finances, friends and family, health, home, personal growth, relationships and business.

Wunder points out it’s a mind-body balance matter.

“When you look better,” she noted, “you feel better.”

The Remodeling Romantics

A home is a haven. And while the new construction and real estate sectors have received black eye after black eye in a shiner of a year, owners still want to give their property value a boost.

Remodeling is the name of the 2009 construction game.

“Remodeling has been an increasing part of the construction market nationally and here in Kitsap County,” said Art Castle, executive vice president of the Kitsap Home Builders Association. “A lot say ‘I really like where I’m at, but the house isn’t where we want it to be,’ and instead of buying a new home a greater percentage of the population is fixing up their homes.”

Wayne Keffer of Wayne R. Keffer Construction, a Central Kitsap-based remodeling establishment, said he did more remodels last year than the year before and for 2009 business is up 30 percent.

He finds kitchen and bathroom spruce-ups are the most popular requests. He’s receiving four to five calls per week and that’s really all that’s needed, Keffer said.

“We seem to be going against the grain according to what we see on the news,” he said. “Our phones are still ringing and we’re still working.”

Robert Coultas, who owns Coultas General Contracting, provides new construction, light commercial and remodeling services.

He said even though a lot of things are collapsing the inquiry to upgrade has held steady.

“If I removed (remodeling) I’d probably be dead in the water. I’d say it’s what’s keeping us going at this point,” Coultas said. “That’s always been the best bang for your buck anyway.”

The Criminal

When employees are sent packing from by-the-books businesses due to a bad economy, it can mean a bump in illegal trades.

“Every recession since the late ’50s has been associated with an increase in crime and, in particular, property crime and robbery, which would be most responsive to changes in economic conditions,” said Richard Rosenfeld, a sociologist at the University of Missouri – St. Louis, to the New York Times. Though, he added, there is often a year lag between an economic change and rising crime rates.

In Kitsap County, some crimes are on a slight rise, while others buck the expected trend. Robberies in 2008 were at their highest level since 2001; aggravated assaults took a leap in 2007 and 2008, rising by nearly 100 annual cases in the last eight years. Burglaries, which had dipped by about as many annual cases over 2006 and 2007, jumped back to more than 1,000 instances in 2008.

But — perhaps gas prices were too high, even for theives — motor vehicle theft dropped in 2008, and regular theft, though on a rise since 2005, is much lower than its 2001 levels.

Poulsbo Police Chief Dennis Swiney said his department has yet to see a major increase in crimes of any kind, but he’s keeping a wait-and-see outlook.

Lost savings and unemployment can cause strain on individuals, he explained, especially for those with dependent family members, possibly leading to more domestic violence.

While things are now consistent for Poulsbo’s officers in blue, “I would not be surprised if we don’t see a percentage of an increase in crime,” Swiney said.

The Alternative Health Heros

Spiked patient interest in alternative health care is a national trend, and for the first time in history during the last year more people made visits to holistic health practitioners than traditional medical doctors.

This isn’t because of the economy, but because more and more people are seeking natural means to treat aliments and moving away from chemical medications.

However, during a time when record numbers of folks are losing their jobs, staying healthy, happy and alert is a solid way to keep the monthly income flowing.

Locally people seem to be cuing into this job preservation tool.

It’s a trend Robert Doane, L. Ac., owner of Poulsbo-based Acupuncture and Wellness Center has observed.

“In this kind of economy your greatest asset is your ability to work and your best way to work is your health so if you want to survive this recession you have to stay healthy,” Doane said. “It’s very difficult to hold down a job when you’re tired, anxious or depressed. You will be laid off if you’re perceived as as someone getting sick all the time or in pain all the time. You put your job at risk so it’s no wonder people are piling in here. They know this.”

He said the center sees 100 people a day and February was the largest February in history for the organizations that’s done nothing but grow.

Kris Stapleton LMT., co-owner of Bainbridge Island’s Bay Massage and Skin Care, said massages slowed down at the start of the year but picked up in mid-Febraury.

But gift certificate sales during Christmas were up 25-30 percent and up 50 percent for Valentines Day.

She attributes the rise in gift certificate sale to people wanting to give a gift experience that will actually benefit someone.

She’s also hearing clients say they’re financially cutting back wherever they can, but are trying to preserve their regular massage schedule as long as possible.

“My clients are under stress and if they can spend on an hour of treatment for physical pain or relaxation it goes further than what they’ve decided to give up,” Stapleton said.