2021-2022 Proposed Budget Wichita, Kansas

Wichita, the largest city in Kansas, population 389,255 is the county seat of Sedgwick County. Major highways, including the Kansas Turnpike and Interstate I-135, link the city with a large trade area encompassing a population of more than 1.1 million people within a 100-mile radius. The nearest large cities are Denver to the west, Kansas City to the northeast, Oklahoma City to the south and Tulsa

to the southeast.

Wichita's population growth remained steady for the past three decades. The majority of recent growth occurred along the far west/northwest and east/northeast peripheries of the city, and into the unincorporated portions of the county.

As of May 2020, the city's total land area was approximately 165.58 square miles.3 The majority of annexation over the past couple of years has been in response to a need for improved utility service in the annexed areas, especially water service.

The metropolitan statistical area (MSA) includes Butler, Harvey, Kingman, Sedgwick and Sumner counties. The MSA has a popula-tion of 647,370. Sedgwick County represents 79.7 percent of the area's population, with an estimated 516,042 residents in 2019.

The city's population density decreased by nearly 50 percent in the past few decades. Today, there are approximately 2,348 persons per square mile in Wichita compared to 4,625 per square mile in 1960, when growth within the city limits peaked. The trend of

perimeter growth and the associated increase in demand for local

government services is expected to continue for Wichita.

The racial and ethnic composition of Wichita's population is compa-rable to the national average. The fastest growing group, both in

Wichita and nationally, is people of Hispanic origin.

POPULATION TRENDS, 1950-2010

YEAR WICHITA (IN 1,000'S)

PERCENT CHANGE

SEDGWICK COUNTY ( IN 1,000S)

PER-

CENT CHANGE

1950 168.3 222.3

1960 254.7 51.3% 343.2 54.4%

1970 276.6 8.6% 350.7 2.2%

1980 279.3 1.0% 367.1 4.7%

1990 304.0 8.8% 403.7 10.0%

2000 344.3 13.3% 452.9 12.2%

2010 382.4 11.1% 498.4 10.0%

Source: U.S. Bureau of the Census, Population of the 100 Largest Cities and Other Urban Places in the United States: 1790 to 1990, Working Population Paper No. 27, 2000 and 2010 population counts from the respective decennial censuses.

POPULATION BY RACE/ETHNIC ORIGIN, 2019 (PERCENT OF TOTAL)

RACE/ETHNIC U.S. WICHITA

Hispanic Origin* 18.3% 18.2%

Not Hispanic 81.7% 82.9%

TOTAL 100.0% 100.0%

White 72.2% 73.5%

Black/African American 12.7% 11.5%

American Indian 0.9% 1.3%

Asian 5.6% 4.5%

Other** 12.1% 13.1%

TOTAL 100.0% 100.0%

* May be of any race, consequently percentages will add to more than 100%. ** Includes other races and persons identifying themselves as multi-racial.

Source: U.S. Census Bureau, 2018 American Community Survey 1-Year Estimates.

WICHITA METROPOLITAN STATISTICAL AREA POPULATION DISTRIBUTION BY COUNTY, 2019

Sedgwick, 79.7%

Butler, 10.4%

Harvey, 5.3%

Sumner, 3.5% Kingman, 1.1%

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2021-2022 Proposed Budget Wichita, Kansas

Wichita is located on the central plains far from any large moderating influences, such as mountains, oceans, or lakes. There is a wide range of temperatures, which fall between a humid subtropical climate and a humid continental climate with hot, humid summers and somewhat cold, dry winters. Despite these extremes, Wichita is known to have more sunny days throughout the year than Miami. Over the course of a year, temperatures range from an average low of about 20° F (−7° C) in January to an average high of nearly 93° F (34° C) in July. The maximum temperature reaches 90° F (32° C) an average of 64 days per year and reaches 100° F (38° C) an average of 14 days per year. Conversely, the minimum temperature falls below 0° F (−17.8° C) an average of 3.6 nights per year. The first fall freeze typically occurs between the second week of October and mid-November, and the last spring freeze occurs between the end of March and the final week of April.

Wichita’s population has achieved relatively high levels of education. In 2018, 87.9 percent of Wichita’s citizens aged 25 years and older had at least a high school diploma, 0.2 percent higher

than the national average.

The city of Wichita is served by eight unified school districts. The Wichita Public School District (USD 259) is the largest in the city. In fall 2019, Wichita USD 259’s enrollment was 49,375 students, a 1.2 percent decline compared to 2018. The elementary grades experienced enrollment declines, while middle school and high

school enrollment increased modestly for the district.

In addition to the public school districts, there are numerous private, public, and technical schools, including 12 colleges and universities providing educational opportunities in many fields of study. Among these are Wichita State University, Newman University, University

of Kansas School of Medicine and Friends University.

Wichita is a regional leader in health care with over 1,600 licensed beds at 11 acute care and freestanding specialty hospitals. In addition to these major treatment facilities, there are approximately 65 nursing homes and assisted living facilities with more than 4,400 beds. Wichita is also home to the Riordan Clinic, an international biomedical research and educational organization, specializing in nutritional medicine and preventive care. Several medical research organizations provide clinical research services for the

pharmaceutical, nutritional and medical device industries.

According to FBI data, the number of violent crimes committed in Wichita decreased 13.8 percent from the first half of 2018 to the first half of

2019.

Over the years, the Wichita Police Department received national recognition and was the recipient of several awards. The Webber Seavey, an international award for quality law enforcement, was presented to

the Wichita Police Department in 1996 and 2003.

Wichita Eisenhower National Airport, the largest airport in Kansas, is a combination commercial air carrier and general aviation complex, providing accommodations for all aircraft. Passenger service is offered through the following airlines:

Cargo service is provided by four major carriers: DHL, Federal Express, UPS Supply Chain Solutions, and UPS. The airport replaced its main terminal with a new $160 million terminal which opened on June 3, 2015. The two-story, 273,000 square-foot terminal is a state-of-the-art facility capable of accommodating two million passengers annually. Eisenhower’s total passengers increased 5.1 percent in 2019, with more than 1.7 million passengers in total (inbound and outbound), its fastest growth in air traffic in more than a decade. Airfreight shipments increased 6.1 percent in 2019, totaling 57.6 million

pounds (inbound and outbound).

Recreational opportunities abound in Wichita. The city's compact size allows minimal travel time (average 30 minutes) to outlying areas with open prairie and lakes. Inside the city there are 144 municipal parks and public open spaces covering more than 5,000

acres.

Cultural activities include art, natural and historical museums, theater, the Mid-America All-Indian Center, the Wichita Symphony, the Wichita Grand Opera, the Metropolitan Ballet, the Lake Afton Public Observatory, Botanica Wichita, and the Sedgwick County

Zoo.

Allegiant Air

American Airlines

Southwest Airlines

Frontier Airlines

Alaska Airlines

Delta Air Lines

United Airlines

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2021-2022 Proposed Budget Wichita, Kansas

Exploration Place, the Sedgwick County science and discovery center, promotes an interest in science for all ages through its permanent and traveling exhibits, summer camps, Maker Faire Wichita, and the Wichita Regional Science and Engineering Fair. The Wichita Art Museum’s permanent collection includes over 8,000 objects, with a focus on

American and Great Plains art.

Wichita is home to many festivals, sporting events, and holiday celebrations, the largest of which is the nine-day Riverfest in June. This event began as a city-financed centennial celebration in 1970. In 2019, Riverfest’s attendance decreased by 4 percent to 440,000, as rainy weather dampened the festivities throughout the week. Since 2013, both attendance and sponsorships for the event have

grown by more than 50 percent.

Minor league baseball, basketball, hockey, soccer and indoor football are some of the professional sporting attractions available in the Wichita area. Wichita is also the host of the annual National Baseball Congress World Series baseball tournament. In 2018, Wichita hosted first and second round NCAA men’s basketball tournament games. The city will host the men’s first and second round games again in 2021, and will host the women’s first and second round games in 2022. Construction was completed on a new $80 million baseball stadium, Riverfront Stadium, in March 2020. The Wichita Wind Surge, a Triple-A minor league baseball team formerly known as the New Orleans Baby Cakes, will mark

their inaugural season in Wichita in the new ballpark in 2020.

Built in 1969, Century II is the performing arts and convention headquarters downtown. The INTRUST Bank Arena is Wichita’s largest sports and entertainment venue, with an over 15,000 seat capacity. The arena ranked as the 123th busiest worldwide in

Pollstar’s 2019 Year-End Arena Rankings.

Downtown Wichita serves as the

region's commercial, entertainment,

artistic, cultural and government

center. The central business district

has 4.8 million square feet of

rentable office space, 40.1 percent of

all rentable office space in Wichita.

Old Town, in the heart of the city, is known for its brick-lined streets,

historic lamp posts and converted warehouses. The late 19th

century and early 20th century buildings house more than 100

restaurants, shops, clubs, theaters, galleries, museums and

businesses.

Downtown Wichita’s residential offerings continued to expand in

recent years, with almost 1,228 residential units added since 2010,

both newly constructed apartment buildings and repurposed

commercial buildings. A number of new projects are currently under

construction in the downtown area, which will add almost 350 new

residential units when completed, including a 200-unit apartment

which broke ground in October 2019 as part of the Delano catalyst

project.

WSU Current Conditions Index

The average annual WSU Current Conditions Index increased 1.5 percent in 2019 compared to 2018, a sign of strengthening economic growth in the Wichita area in 2019. With the increase, the index reached its highest level since 2008, as 2019 growth outpaced even 2018 growth, which was the highest in more than a decade. Growth continued to accelerate in the first two months of 2020, with the February 2020 index reaching a value of 99.1, representing an increase of 1.7 index points compared to one year prior. Strong employment growth of 1.9 percent and a decline of the unemployment rate by 0.2 percentage points led growth in the index. Average hours worked and average weekly earnings both

declined modestly in 2020. All indicators are seasonally adjusted.

The WSU Leading Economic Indicators Index is designed to foreshadow the Wichita economy approximately six months into the future. In 2019, the annual average indexed value increased 0.9 percent relative to 2018, its highest level since 2008. The index continued to improve in the first two months of 2020, reaching an index value of 98.3 for February 2020, indicating relatively strong prospects for the local economy prior to the outbreak of the novel coronavirus. The improvement was led by growth in the National Industrial Production Index and Aircraft Production Index, while the other two components of the index declined modestly in 2019. While the Leading Economic Indicators Index in 2019 signaled that under normal conditions robust growth would be expected, it does not account for the effects the novel coronavirus will have on

slowing down the local economy.

Wichita's employment includes a broad mix of business types, with a sizable base of relatively high paying manufacturing jobs. A list of Wichita's major private employers includes Spirit AeroSystems Inc., Via Christi Health, Textron Inc., Bombardier Learjet, Koch Industries Inc., Wesley Medical Center, Dillons Food Stores, Cargill Meat

Solutions, Johnson Controls and Cox Communications.

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2021-2022 Proposed Budget Wichita, Kansas

Beyond these major private employers, Wichita’s numerous small and mid-sized companies supply a wide variety of goods and services both to local and global markets. According to the 2017 County Business Patterns, the total number of business establishments grew 0.4 percent in the metropolitan area in 2017, to 15,026 establishments. Approximately 97.3 percent of all business establishments in the metropolitan area employed fewer than 100

workers.

Total wage and salary employment in the Wichita metro area increased 1.8 percent in 2019, creating 5,500 new jobs, the single fastest-growth year since 2008. Growth was broad-based in 2019, with only job declines in the trade sector. The goods-producing and

service sectors each added more than 2,500 jobs.

The industries with employment growth were manufacturing (2,600 jobs), mining, logging and construction (100 jobs), wholesale trade (100 jobs), transportation and utilities (400 jobs), financial activities (300 jobs), education and health services (1,600 jobs), professional and business services (600 jobs), leisure and hospitality (500 jobs), other services (400 jobs), and government (200 jobs). The following industries experienced employment declines: retail trade (800 jobs),

and information (300 jobs).

In 2019, the largest employment sectors were manufacturing (18 percent), education and health services (15.3 percent), government (13.7 percent), and professional and business services (11.6 percent). Overall, private sector services comprised 46.3 percent of Wichita employment, while the goods producing sectors comprised 23.5 percent and the trade and transportation sectors comprised

16.5 percent.

Though the local economy grew rapidly in 2018 and 2019, employment is projected to decline sharply in 2020 due to the

effects of both the outbreak of the novel coronavirus and the Boeing 737 Max production freeze reducing demand in Wichita’s aerospace

manufacturing sector.

In 2020, employment is projected to decline 14.6 percent in Wichita, a loss of approximately 44,400 jobs. The largest job declines are expected in the production sector, at 23.2 percent, the trade, transportation, and utilities sector, at 14.6 percent, and the leisure and hospitality services sector, at 30.6 percent. The decline in employment is expected to be most severe in the second quarter of 2020, with the economy beginning to recover for the remainder of

the year and into 2021.

Unemployment declined in 2019 to 3.4 percent for the Wichita MSA, its lowest rate since 1997. The unemployment rate is expected to increase rapidly in the second quarter of 2020, reaching a peak that may exceed 20 percent before declining to the single digits in late 2020 and 2021. Weakness in the market for air travel may cause Wichita’s recovery to be slower than the national average due to low

demand for aerospace manufacturing.

Even with all of these amenities, Wichita continues to maintain a moderate cost-of-living rate of 90.8, almost 10 percent lower than the average among 266 urban areas in the United State and lower than 70 percent of U.S. urban areas. The 2019 fourth quarter median sales price of existing single-family homes in the Wichita MSA was $156,800 compared to the national median price of $274,900, according to the National Association of Realtors. Wichita’s home prices ranked the 35th least expensive among metro areas in the U.S., more than 40 percent less than the national median. The average sale price of a newly built single-family home in 2019 in the Wichita metro area was $257,561, considerably lower

than the national average price of $366,058.

The Wichita MSA’s total nominal personal income increased 6.2 percent in 2018 after increasing 4.6 percent in 2017. In 2019, personal income growth is projected to be an estimated to be 5.7 percent before adjusting for inflation, and in 2020 personal income

is forecast to decline 15.8 percent.

In 2018 (latest data available as of this printing), the Wichita MSA had a total personal income (TPI) of $33 billion. This TPI ranked 87th largest among 383 metro areas in the United States. From 2008 to 2018, the average annual growth rate of TPI for the Wichita MSA was 2.6 percent, modestly lower than the national 3.6 percent growth rate, due in large part to the slower population growth in the

Wichita area.

In 2018, Wichita had a per capita personal income (PCPI) of $51,804. This PCPI ranked 97th highest among 383 metro areas in the United States and was slightly below the national average,

TOTAL EMPLOYMENT GROWTH RATE

Source: Bureau of Labor Statistics. Compilation and forecast by the Cen-ter for Economic Development and Business Research, W. Frank Barton School of Business, Wichita State University.

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2021-2022 Proposed Budget Wichita, Kansas

$54,501. Wichita’s 2008-2018 average annual growth rate of PCPI was 1.8 percent, which was 1.1 percent lower than the national PCPI growth rate largely due to declines in Wichita’s per PCPI from 2008 to 2010. Between 2019 and 2024, total personal income is forecast to grow at an average annual rate of approximately 2.9

percent.

Manufacturing accounted for 18 percent of total nonfarm employment in the Wichita MSA in 2019. About 85.1 percent of manufacturing jobs are in the durable goods sub-sector, primarily in aviation manufacturing along with a sizable machinery manufacturing subsector. About 14.9 percent of manufacturing jobs are in the non-durable goods sub-sector, dominated by jobs in food

processing and printing.

The durable goods sector grew sharply in 2018 and 2019, adding 4,600 new jobs in the two-year period as aerospace manufacturing companies began to increase production to meet high demand. Spirit Aerosystems, Wichita’s largest private employer, added more than 2,400 jobs in 2018 and 2019 as part of a $1 billion capital investment and renovation program for their Wichita campus. Textron Aviation, Wichita’s second largest manufacturer and the leader of Wichita’s sizable general aviation manufacturing production, announced plans in May 2019 to hire 1,000 new workers following a 35 percent increase in jet and turboprop deliveries from the company in the first quarter of 2019 compared to

a year earlier.

Late 2019 and 2020 have presented new challenges for Wichita’s manufacturers, especially in the aviation market. Boeing froze production on their 737 Max airliner in December 2019 after the

grounding of all 737 Max planes in March 2019. This had reverberations throughout the aerospace supply chain that were felt by Spirit, which supplies the fuselage for the 737 and other parts, and by Wichita’s smaller aerospace suppliers. Spirit announced layoffs of 2,800 workers in January 2020 as a result of the 737 production freeze. In May 2020, Spirit announced that they planned to restart 737 Max part production at the request of Boeing, but they expected 737 Max output in 2020 to be approximately 80 percent

lower than in 2019.

The grounding the 737 Max led to soft aerospace demand even prior to the outbreak of the novel coronavirus, and the outbreak severely reduced air travel demand. The TSA reported that passenger traffic was reduced approximately 95 percent in April 2020 as compared to one year earlier nationwide. Many local aerospace companies and their suppliers have announced temporary furloughs of workers in response to the outbreak,

including both Spirit and Textron Aviation.

While Wichita’s manufacturing sector has diversified in recent years to include more non-durable and machinery manufacturing, the area’s concentration in aerospace will likely contribute to a relatively sharp decline in manufacturing in 2020 and a potentially slow recovery for the sector if air travel remains at low levels for several years if the threat of the virus continues. The manufacturing sector is projected to decline by 26.1 percent in 2020, a loss of more than 14,300 jobs, with more than 93 percent of the job losses

concentrated in the durable goods sector.

The service sectors increased 2.2 percent in 2019 for a total increase of 3,100 jobs:

The information sector contracted by 300 jobs, a decline of 7.1

percent.

Financial activities employment increased by 2.6 percent,

growing by 300 jobs.

The professional and business services sector increased by 600

jobs for growth of 1.7 percent.

The education and health care services sector grew 3.6 percent,

adding 1,600 jobs.

The leisure and hospitality sector gained 500 jobs for an

increase of 1.5 percent.

The other services sector grew by 3.8 percent, adding 400 jobs.

In 2020, due to COVID-19, job declines are expected across all Wichita service sectors. Since Wichita’s manufacturing sector is expected to be especially hard hit due to its concentration of

TOTAL PERSONAL INCOME GROWTH RATE

Source: U.S. Dept. of Commerce, BEA. Forecast by the Center for Economic Development and Business Research, W. Frank Barton

School of Business, Wichita State University.

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2021-2022 Proposed Budget Wichita, Kansas

aerospace manufacturing, local services are projected to experience additional job losses as an indirect effect of the contraction in the manufacturing sector. For 2020, service sector employment is expected to contract by more than 19,800 jobs, a

decline of 14.1 percent.

The leisure and hospitality sector is projected to be hardest hit by the effects of the novel coronavirus. Approximately 75.8 percent of employment in the sector in 2019 was in the food and drinking places subsector. With restaurant dining rooms closed during the stay-at-home order in April and May, and social gatherings discouraged throughout the year, leisure and hospitality employment is forecast to decline by 30.6 percent, a contraction of

more than 10,100 workers.

The other services sector is forecast to decline by 9.8 percent, one of the biggest contractions among Wichita’s service sectors. The other services sector includes repair and maintenance shops, personal care and laundry services, and religious organizations. Employment at personal care services, such as barber shops and nail salons, is expected to contract sharply due to decreased

demand during the novel coronavirus outbreak.

The education and health care services sector is Wichita’s single largest sector, with 46,600 workers in 2019. The sector had a very positive 2019 as a $62 million renovation of the Via Christi Health’s St. Joseph campus was completed and Wichita State University, the largest local university, continued its Innovation Campus initiative with the construction of a new YMCA, a new residence hall, Student Athlete Success Center, and the NIAR Advanced Virtual Engineering and Testing Labs. Employment grew across all subsectors, including the hospital subsector and education

subsector.

In 2020, employment is projected to decline 8.7 percent in the education and health care sector, a loss of approximately 4,000 jobs. Under Center for Disease Control guidance, elective procedures at area facilities were suspended at local specialty hospitals during the stay-at-home order, and while elective procedures are expected to resume in May, they will be performed at a reduced level compared to previous years. More generally, reduced usage of the health care system for non-coronavirus-related issues is likely to lead to employment declines concentrated in the non-hospital portion of the health care system. In the education sector, employment declines are expected due to revenue uncertainty caused by the potential declining enrollment of international students. Wichita State implemented a hiring freeze

and other cost-cutting measures in anticipation of revenue declines.

The professional and business services sector is projected to decline by 3,000 workers, contracting 8.7 percent. The administration and support subsector is expected to be most heavily

affected by the declines, while the technical and scientific services

subsector is expected to experience a smaller contraction.

Natural resources, mining and construction employment comprised 23.2 percent of all goods-producing industry employment in Wichita in 2019. The industry added 100 jobs in 2019, growing 0.6 percent, following the addition of 300 new jobs in 2018. Prior to that growth had been relatively flat in 2016 and 2017. With the decline in oil prices and reduced demand for new construction, the sector is projected to decline by more than 2,200 jobs in 2020, a contraction

of 13.6 percent.

Activity in both the residential and non-residential sectors increased in 2018 and 2019, indicating a solid foundation in the market. Home sales increased 1.6 percent from 2015 to 2018, though new home construction declined from 1,081 single-family homes in 2017 to 993 homes in 2018. Home prices continued to appreciate, growing 3.2 percent in 2018 and 15.8 percent since 2014. Prior to the outbreak of the novel coronavirus, Stanley Longhofer, director of the Wichita State University Center for Real Estate, forecasted that home prices would continue to increase in 2020 by 4.3 percent. Due to reduced mobility and job losses during the novel coronavirus outbreak, Wichita is likely to see lower home sales and reduced asking prices for the duration.

Sources: This report was prepared by the Center for Economic Development and Business Research at Wichita State University at the request of the City of Wichita Department of Finance.

1. 2018 Census population estimates.

2. U.S. 2010 Census. The Wichita MSA is comprised of Butler, Harvey, Kingman, Sedgwick and Sumner counties. This metropolitan statistical area delineation was issued by The Office of Management and Budget in February 2013. Population represents only the Kansas portion of the 100-mile

radius, not the Oklahoma portion.

3. Wichita-Sedgwick County Metropolitan Area Planning

Department.

4. 2019 FBI Semiannual Uniform Crime Report.

5. City of Wichita Park and Recreation Administration.

6. Greater Wichita Economic Development Coalition, https://

greaterwichitapartnership.org/site_selectors/labor_data.

7. J.P. Weigand & Sons, Inc., Forecast 2020

8. 2020 County Business Patterns data was not yet available as

this printing.

9. C2ER, ACCRA Cost of Living Index, 2019 Annual Average.

10. City of Wichita, Office of Building Inspection.

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2021-2022 Proposed Budget Wichita, Kansas

Map of Wichita The following maps provide insight into the past and future of the boundaries of the City of Wichita. The Wichita City Limit: Growth by Decade map illustrates decades of fast growth, such as the 1910s, 1950s, and 1960s, with periods of relatively slower expansion in the 1920s, 1970s, and first half of the 2010s.

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2021-2022 Proposed Budget Wichita, Kansas

Map of Wichita “The 2035 Urban Growth Areas Map” looks into the future of growth in Sedgwick County.

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