December was a disappointing month for sales across most of Cochise County. Retail sales, one of the best indicators of the overall health of the economy, fell by 15.5 percent in December after adjusting for inflation. Restaurant and bar sales fell by 30 percent. Accommodation sales, which include hotel, motel, and other temporary lodging stays, and are one of the best indicators of the health of the local tourism industry, fell by 7.7 percent after adjusting for inflation.

Retail sales totaled just $84.7 million in December, down from $95.7 million in December 2006. For the year, retail sales totaled $796.7 million in 2007, down 1.3 percent from 2006 after the inflation adjustment. Retail sales at the county level were on shaky ground throughout 2007, alternating between periods of positive and negative monthly growth.

Cochise County’s restaurant and bar sales totaled just $10.5 million in December, down from $14.2 million in December 2006. In 2007, restaurant and bars sales were up only 0.1 percent compared to 2006, after adjusting for inflation. Sales were strong in the first and second quarters of the year, but slowed in the third quarter and declined in the last quarter of the year.

Accommodation sales totaled $2.7 million in December, down from $2.8 million in December 2006. For the year, sales were up 19.7 percent in inflation-adjusted terms, led by exceptionally strong growth in the first three quarters of the year. Sales fell in October, rebounded in November, and slipped back into negative territory in December.

At the city level, restaurant and bar receipts in Benson totaled $872,000 in December, an inflation-adjusted drop of 16.9 percent. For the year, Benson’s restaurant and bar sales were down 3.1 percent after inflation. Sales struggled much of the year, with the exception of January, April, June, and July, which saw strong growth compared to the same months the year prior.

Benson’s accommodation receipts totaled $404,000 in December, up 9.6 percent in inflation-adjusted terms. Sales were up 17.6 percent for 2007, after the inflation factor.

Retail sales are not reported for Benson due to the city’s two-tiered tax system, which precludes accurately estimating sales based on tax collections. Retail sales tax revenue, however, was up 3.7 percent in the December comparisons. For 2007, the city’s retail sales tax revenue was up 38.2 percent. The increase is due primarily to the opening of the Wal-Mart Supercenter in December 2006.

In Bisbee, retail sales in December came in at $2.9 million, down 4.9 percent from December 2006 after adjusting for inflation. For the year, sales were up 3.8 percent after inflation.

Bisbee’s restaurant and bar sales in December were down 18.9 percent after adjusting for inflation. December sales totaled $577,000. On the whole, Bisbee’s restaurant and bar sales were down 4.4 percent in 2007, after adjusting for inflation.

Bisbee’s accommodation receipts totaled $168,000 in December. This was down 1.1 percent from December 2006, after adjusting for inflation. Last year, Bisbee’s accommodation sales were up 20.9 percent after inflation.

In Douglas, restaurant and bar sales fell to $1.1 million in December, down 13.8 percent after inflation. This was the sixth consecutive month of declining sales. For 2007, sales were down 2.9 percent after inflation.

Retail sales are not reported for Douglas due to the city’s two-tiered tax system. Retail sales tax revenue, however, was down 2.3 percent in the December comparisons. For the year, retail sales tax revenue was up 2.2 percent, failing to keep pace with inflation, which was 2.8 percent in 2007.

Accommodation sales are not reported for Douglas due to the small number of establishments and the Arizona Department of Revenue’s confidentiality policy.

In Huachuca City, retail sales totaled $402,000 in December. This was down 55.9 percent from a year prior, after adjusting for inflation. Overall, sales were down 17.4 percent last year, in inflation-adjusted terms. Huachuca City saw the largest overall decline in retail sales in Cochise County last year.

Accommodation and restaurant and bar sales are not reported for Huachuca City due to the small number of establishments and ADOR’s confidentiality policy.

In Sierra Vista, retail sales came in at $57.2 million in December. This was down 3.4 percent from a year prior, after inflation. For the year, sales were up 2.6 percent after the inflation adjustment.

Sierra Vista’s restaurant and bar sales fell to $5.5 million in December. This represents an inflation-adjusted decline of 6.2 percent. Sales fell each month in the fourth quarter, following exceptionally strong growth in the first three quarters of the year. For 2007, sales were up 2.9 percent after inflation.

Sierra Vista’s accommodation sales increased to $1.2 million in December, up 4.5 percent after inflation. For the year, sales were up 21.1 percent in inflation-adjusted terms. Much of this year’s growth is attributable to the opening of several new hotels, which reduces business leakage to surrounding areas.

In Tombstone, retail sales in December were down 12.5 percent after inflation. December sales totaled $795,000. For the year, sales were down 5.2 percent in inflation-adjusted terms. Tombstone’s retail sales were down each month in the fourth quarter, following alternating periods of positive and negative growth earlier in the year.

Tombstone’s restaurant and bar sales totaled $457,000 in December. This is a 7.9 percent inflation-adjusted decrease from a year prior. For 2007, sales were up 12.3 percent after adjusting for inflation. Restaurant and bar sales in Tombstone were exceptionally strong in the first three quarters of the year, but the last quarter of the year saw sales fall in two of the three months, cutting into gains made earlier in the year.

Accommodation receipts in Tombstone totaled $121,000 in December, for an inflation-adjusted drop of 8.7 percent. In 2007, accommodation sales were up 5.2 percent after inflation.

In Willcox, restaurant and bar sales fell to $741,000 in December, for an inflation-adjusted drop of 5.6 percent. For the year, restaurant and bar sales in Willcox were down 3.9 percent after inflation.

Accommodation receipts in Willcox fell to $372,000 in December, for an inflation-adjusted drop of 12 percent. For the year, receipts were up 23.8 percent after adjusting for inflation. Willcox saw the largest annual increase in accommodation sales in Cochise County last year. Sales saw double-digit growth every month from March through September, but then fell in October and December and saw modest inflation-adjusted growth of 3 percent in November.

Retail sales are not reported for Willcox due to the city’s two-tiered tax system. Retail sales tax revenue, however, was up 4.2 percent in the December comparisons. For 2007, the city’s retail sales tax revenue was up 3.4 percent compared to 2006, slightly ahead of inflation.

If you have any questions on the economy, please contact the Cochise College Center for Economic Research at (520) 515-5486 or email us at cer@cochise.edu. Be sure to check out the CER’s website at www.cochise.edu/cer.