Gray matters: an economic analysis of Yavapai County's senior industries

              Gray Matters
An Economic Analysis
of Yavapai County’s
Senior Industries
Gray Matters
An Economic Analysis of Yavapai County’s Senior Industries
By Rick Heffernon
Senior Research Analyst
Morrison Institute for Public Policy
Special data analysis by
Tom Rex, Manager
ASU Center for Business Research
With Assistance From: Rob Melnick, Director, Morrison Institute for Public Policy
Christina Kinnear, Graduate Research Associate, Morrison Institute for Public Policy
Prepared for:
Arizona Department of Commerce and Yavapai College
February 2002
The assistance of the following people is gratefully acknowledged: Mary Jo Waits, Karen Leland, Nielle McCammon,
Cherylene Schick, and Alice Willey of Morrison Institute for Public Policy | Nancy Welch, The Insight Group | Karen C. Heard, Chalk Design
Mike Leyva, Arizona Department of Commerce | Anne McKinley and Meg Fenzi of Yavapai College, Institute for Applied Gerontology
Arizona State University / College of Public Programs / School of Public Affairs
PO Box 874405, Tempe, Arizona 85287-4405 / (480) 965-4525 voice / (480) 965-9219 fax
www.asu.edu/copp/morrison / www.morrisoninstitute.org
This document is ©2002 by the Arizona Board of Regents for and on behalf of Arizona State University and its Morrison Institute for Public Policy.
Table of Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Primary Components of Senior Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Major Findings of this Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
Demographics of Yavapai County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
Finances of the Senior Population . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15
The Economy of Yavapai County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
Composition and Size of Senior Industries in Yavapai County . . . . . . . . . . . . . . . . .21
Health Care and Social Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
Construction and Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
Retail Trade and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
Dynamics of Senior Industries in Yavapai County . . . . . . . . . . . . . . . . . . . . . . . . . .29
Relationships Among Senior Industries Components . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
Senior Industries Drivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
Competitors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
Requirements for Growth and Vitality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
Opportunities for Collaborative Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
Workforce . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
Health Care Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36
Infrastructure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37
Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37
Appendix A: Interviews Conducted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
Appendix B: Summary of Comments and Group Discussion . . . . . . . . . . . . . . . . . .40
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 3
Table of Contents
Tables
Table 1: Age Distribution in Yavapai County, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
Table 2: Changes in Yavapai County Age Distribution from 1990 to 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Table 3: Estimated Net Migration to Yavapai County, 1990 to 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Table 4: Population and Median Age in Yavapai County Places, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Table 5: Changes in Population and Median Age in Yavapai County Places, 1990 to 2000 . . . . . . . . . . . . . . . . . . . .14
Table 6: Per Capita Personal Income in Yavapai County, 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Table 7: Estimated Expenditures by Residents of Yavapai County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
Table 8: Employment in Yavapai County, 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
Table 9: Change in Employment in Yavapai County, 1991-1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
Table 10: Establishments by Region in Yavapai County, 1997 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
Table 11: Employment in Economic Activities Influenced By Seniors in Yavapai County, 1999 . . . . . . . . . . . . . . . . .21
Table 12: Employment for the Health Care and Social Assistance Sector in Yavapai County, 1999 . . . . . . . . . . . . . .22
Table 13: Establishments in the Health Care and Social Assistance Sector in Yavapai County, 1999 . . . . . . . . . . . . . .23
Table 14: Employment and Wages by Health Care Occupation in Yavapai County, 1999 . . . . . . . . . . . . . . . . . . . . .24
Table 15: Employee Productivity, Health Care and Social Assistance Sector in Yavapai County, 1997 . . . . . . . . . . . .24
Table 16: Economic Activity by Yavapai County Place, Health Care and Social Assistance Sector, 1997 . . . . . . . . . . .25
Table 17: Construction and Real Estate Employment in Yavapai County, 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
Table 18: Retail Trade and Services Employment in Yavapai County, 1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
Figures
Figure 1: Components of Senior Industries in Yavapai County . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Figure 2: Sectors Providing Direct Products and Services to Seniors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
Figure 3: Forces Affecting Yavapai County Senior Industries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
Figure 4: Long-term Strategies to Keep Senior Industries Healthy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
4 Morrison Institute for Public Policy
Introduction
In the face of a growing and aging senior population in Yavapai County, questions have been raised about the
capacity to serve this population in the future. Will the county’s workforce be adequate to staff long-term health
care facilities and other industries that serve seniors? Will the area’s public institutions have the resources to
address senior needs? Will the region’s infrastructure be ready to meet the demands of senior population growth?
To begin to address such questions, the following research report was commissioned by the Arizona Department
of Commerce in association with Yavapai College. The immediate goal is to provide baseline economic data and
analysis on the status of senior industries in Yavapai County. The ultimate objective, however, is that this information
be used as a tool by business leaders, local governments, and area institutions to collaborate on strategic plans that
strengthen senior industries – and thereby assure adequate health care capacity and high levels of service to the
county’s aging population for the future.
Senior industries is currently recognized as an important economic cluster in Arizona and has been identified by
the Governor’s Strategic Partnership for Economic Development as one of 11 industry clusters in the state that
collectively drive the economy. The term “cluster” refers to a geographic concentration of interdependent companies
– as well as their suppliers, skilled work force, and institutions – that together constitute an important competitive
advantage for a region.
Dynamic clusters act as primary growth influences on local economies because they produce goods or services that
are exported to customers outside the region. This creates an influx of “new” money that stimulates economic
activity in other areas of the local economy. Clusters also attract related businesses to an area, and they tend to
spawn new start-ups and innovation.
In Yavapai County, senior industries has not yet reached the level of a classic export-driven cluster because it lacks
significant sales of its products outside the region. As an economic factor in the county, however, senior industries
exerts a powerful influence. Its financial and employment effects ripple across most sectors of the local economy.
This report profiles Yavapai County’s senior industries, beginning with a brief overview of senior industries com-ponents
and a listing of significant findings of the study. In following sections, the report presents more detailed
information on the age group characteristics of county residents, the spending patterns of seniors, the economic
composition and relative size of senior industries, and the dynamics and requirements for growth of senior indus-tries.
In its conclusion, the report presents a menu of options for strengthening senior industries in Yavapai
County. All analysis is based on the latest available demographic and economic data at the time of writing, as well
as primary and secondary research performed by Morrison Institute for Public Policy in the fall of 2001.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 5
Overview
The senior population in Yavapai County is disproportionately large due to a substantial net in-migration of
middle-aged or older individuals who then age in place. Senior migrants arrive in the county carrying not only
the net worth they earned elsewhere, but also the ability to import revenue into the county in the form of retirement
benefits, Medicare, dividends, interest, rent payments from outside the region, and other types of income. The
consistent flow of outside revenue due to seniors has created what is known as a “mailbox economy” in Yavapai
County. The economic impact of senior spending also reveals itself in the county’s industrial mix, which is
characterized by higher than average shares of activity in construction, real estate, retail sales, and health care.
Primary Components of Senior Industries
Businesses that provide essential and/or highly desirable products and services to the senior population (defined for
this study as people 55 or older) make up the core components of senior industries in Yavapai County. An
organizational chart, below, illustrates the main components of senior industries and depicts how they are linked
hierarchically. It contains four categories of components: 1) the market for senior industry products and services,
2) direct providers of products and services, 3) specialized suppliers of the direct providers, and 4) the foundations
of senior industries, which consist of underlying infrastructure and institutions that help support economic vitality.
FIGURE 1: Components of Senior Industries in Yavapai County
Market
Direct
Products
and Services
Suppliers
Foundations
Market: The senior industries market is made up almost entirely of local residents – the seniors who live in
Yavapai County. These seniors either stayed in Yavapai County after retirement and aged in place, or they relocated
to the county and essentially bought into a Yavapai County lifestyle.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 7
Colleges
and
Worker
Training
Specialty Equipment
Manufacturers
Subcontractors
and Other Services
Wholesale Products
and Parts Suppliers
Health Care
and Social
Services
Construction
and
Real Estate
Retail Trade
and Services
Public
Transportation
and Utilities
Arts,
Education, and
Recreation
Financial
and Legal
Services
Skilled
Workforce
and
Volunteers
Government
and Economic
Development
Organizations
Industry
and
Community
Associations
Public
Transportation
and Utilities
Financial
and Legal
Services
Quality
of Life
Senior Consumers
Direct Products and Services: Businesses that directly affect seniors offer products and services that seniors
need in order to live and enjoy life in Yavapai County. While these products and services are generally available
to the younger population as well, the businesses that provide them are strongly influenced by senior expenditures.
Senior spending most heavily impacts health care and social services. This industry sector includes not only medical
professionals, hospitals, and elderly care facilities, but also a variety of family, community, and emergency services,
including those provided by government agencies, non-profits, and volunteer organizations. Other sectors
represented in the cluster – such as construction and real estate or arts, education, and recreation – either receive
a significant share of revenue from senior expenditures or contribute substantially to making Yavapai County an
attractive and viable place for seniors to live.
Suppliers: Companies that supply materials and services to the direct providers range from local subcontractors
and other specialty services (e.g., medical billing), to national wholesalers of raw materials or retail products, and
specialty manufacturers of critical equipment (e.g., medical instruments, office machines, electronic casino games).
Nearly all of the wholesale suppliers and specialty manufacturers are located outside of the region.
Foundations: The foundation of senior industries is comprised of a diverse mix of institutions and infrastructure
components that have the potential to attract seniors and benefit existing firms. Workforce training and retention
is of particular importance to the labor intensive components of senior industries because the county’s employ-ment
base is relatively small compared to the total population – about 20 percent below the national average.
The region’s attractive quality of life is also a crucial foundation of senior industries because it plays a primary
role in attracting and retaining senior residents. Furthermore, government policies perform a significant function
in determining how well seniors are served both by public agencies and private enterprises.
Major Findings of this Study
• Yavapai County’s population is almost a decade older than the nation as a whole – and it is
growing even older. The region’s continuing attraction as a retirement haven, and the aging in place of
current residents, has helped raise the county’s median age by more than two years since 1990. Baby-boomers,
who are just now reaching the senior age groups (55 or older), constitute the largest segment of
the population, and as they continue to grow older the county’s median age will continue to rise.
• Rapid growth of the population and the economy of Yavapai County has been fueled almost
entirely by in-migration of new residents. All of the county’s population growth since 1990 is the
result of people migrating into the region. Approximately one-third of those in-migrants each year are
over the age of 55, and their spending adds significantly to the local economy. Another third of the county’s
in-migrants are baby-boomers who will begin retiring in significant numbers during the next decade.
• Seniors spend more than their share and have a high impact on specific industry sectors, including
medical services, construction, real estate, retail trade, and other services. These sectors dominate
the local economy, but most individual business establishments within them are relatively small and not
high paying. Employers report difficulties finding both skilled and entry-level workers. Few businesses
have significant exports outside the region – with the exception of gambling, which routinely markets to
seniors in Arizona’s metropolitan areas and also draws tourists from other areas outside the county.
8 Morrison Institute for Public Policy
• Half of Yavapai County’s health care and social assistance facilities reside in Prescott. Most of
these offices tend to be small relative to national employment figures. Hourly wages follow national norms
for most occupations, but productivity appears to be low compared to national averages.
• Firms comprising senior industries are not well connected across industry sectors. Major
components of senior industries – such as health care and construction – have traditionally found little
reason to combine forces, consequently it is unusual for them to engage in joint ventures or other
cooperative enterprises that cross sectors. Within individual sectors, however, firms tend to develop complex
interrelationships in order to efficiently conduct commerce. Most businesses also maintain working
relationships with area governments and schools.
• The economic future of senior industries in Yavapai County hinges on resolving workforce
shortages, assuring sufficient capacity to serve the needs of an aging population, and protecting
the region’s quality of life. These issues, which need to be addressed by a working group of senior
industries leaders, are discussed more fully in this report’s final section, “Opportunities for Collaborative
Action.” Over the long term, senior industries will also need to attract or spawn its own export-driven
businesses in order to create more high quality jobs and increase the wealth of the region’s workers.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 9
Demographics of Yavapai County
In recent years, an increasing proportion of the American population has been retiring before the age of 65, and
a small but important segment of this group has made a long-distance move upon retirement. A relatively large
number of these retirees, commonly called “seniors,” currently live in Yavapai County. Regardless of whether these
seniors are defined as being over 55, over 60, or over 65 years of age (for this report, the senior population is
defined as 55 years or older) Yavapai County had the second highest proportion of seniors in 2000 among counties
in Arizona, with only the much less populous La Paz County having a higher percentage. Among the attributes
of Yavapai County’s overall population are the following:
• Yavapai County’s age distribution tilts strongly toward older age groups. The 2000 census shows that
the county’s median age of 44.5 years is approximately one decade older than both the state and the
national median age (34.2 years and 35.3 years respectively). In addition, the proportion of the county’s
population in the older age groups (45 and up) was higher than state and national proportions, with the
widest differences among those 65 to 84. Meanwhile, the proportion of every younger age group (less
than 45 years old) was lower than state and national totals, with the greatest shortfall among those 20 to
34 years old and children under 10.
TABLE 1: Age Distribution in Yavapai County, 2000
Difference Difference
Percent of in Share in Share
Age Group Yavapai Population from Arizona from U.S.
0-4 5.2% -2.3% -1.6%
5-9 5.7 -1.9 -1.6
10-14 6.4 -1.0 -0.9
15-19 6.3 -0.9 -0.9
20-24 4.7 -2.4 -2.0
25-34 9.1 -5.4 -5.1
35-44 13.2 -1.8 -2.8
45-54 14.5 2.3 1.1
55-59 6.6 1.9 1.8
60-64 6.3 2.3 2.5
65-74 12.1 5.0 5.6
75-84 7.8 2.8 3.4
85 or Older 2.1 0.8 0.6
Seniors
65 or Older 22.0% 8.6% 9.6%
60 or Older 28.3 10.9 12.1
55 or Older 34.9 12.8 13.9
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 2000 census.
• Despite Yavapai County’s high median age, the most populous age brackets are those dominated
by “baby-boomers,” not seniors. The most populous age groups in 2000 were those age 35 to 44 and
45 to 54 – groupings that nearly coincide with what is known as the “baby-boom” generation (those born
from 1946 to 1964). The large size of the baby-boom age groups compared to those both younger and
older helps explain changes in the county’s age distribution from 1990 to 2000 (see Table 2) – the share
of Yavapai County residents from 25 to 34 years old decreased as the baby-boomers aged out of that group
while the share of those 45 to 54 years old increased as baby-boomers aged into that group.
• The senior share of the population in Yavapai County has declined slightly. During the 1990s, the
percentage share of seniors 55 and older dropped 1.4 percent in the county though it held steady in the
state and the nation. The greatest declines occurred among those 65 to 74, with some increases occurring
among those 75 and older. The share of younger adults age 25 to 34 years old also dropped somewhat,
but not as much in Yavapai County as elsewhere.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 11
TABLE 2: Changes in Yavapai County Age Distribution from 1990 to 2000
Difference Difference
Yavapai Percent in Share in Share
Age Group Change 1990-2000 from Arizona from U.S.
0-4 -0.4% 0.1% 0.2%
5-9 -0.6 -0.5 -0.6
10-14 0.3 -0.1 -0.1
15-19 0.4 0.3 0.4
20-24 0.1 0.6 1.0
25-34 -2.2 0.6 1.0
35-44 -0.3 -0.9 -1.2
45-54 4.1 1.4 0.8
55-59 1.1 0.4 0.5
60-64 -0.7 -0.5 -0.2
65-74 -3.1 -2.3 -2.3
75-84 0.8 0.3 0.4
85 or Older 0.5 0.2 0.2
Seniors
65 or Older -1.8 % -1.8% -1.7%
60 or Older -2.5 -2.3 -1.9
55 or Older -1.4 -1.9 -1.4
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 2000 and 1990 censuses.
• Arrival of new residents accounts for all of Yavapai County’s recent growth. From 1990 to 2000,
the county experienced a rapid growth rate of 56 percent, adding a total of nearly 60,000 residents. But
the number of births in Yavapai County was exceeded by the number of deaths during this time.
Therefore, all of the county’s growth was the result of a net in-migration of residents – the excess number
of those moving into the county compared to those moving out.
• New arrivals during the 1990s were older than average, with seniors and baby-boomers each
strongly represented. The median age of net migrants to Yavapai County between 1990 and 2000 was
47.2, nearly 12 years older than the median age for the nation (35.3). High net in-migration was evident
in all age groups from 35 to 74, with seniors and baby-boomers each contributing about one-third of the
county’s total net inflow. Meanwhile, net in-migration of younger adults during the 1990s – especially
those 20 to 24 years old – was weak.
TABLE 3: Estimated Net Migration to Yavapai County, 1990 to 2000
Age Group in 2000 Number
0-4 800
5-14 7,900
15-24 5,200
25-34 4,100
35-44 10,300
45-54 10,400
55-64 11,400
65-74 9,300
75-84 1,600
85 or older 200
TOTAL 61,200
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research estimating from U.S. Bureau of the Census, 2000 and 1990 censuses, and
births and deaths from the Arizona Department of Health Services and the U.S. Department of Health and Human Services, National Center for Health Statistics.
12 Morrison Institute for Public Policy
• Age distribution is not uniform across Yavapai County. Among the 28 total “places” (cities, towns,
and unincorporated communities) identified by the 2000 census, most had median ages greater than the
national median age. Five, however, did not – Ash Fork, Bagdad, Paulden, and the two Indian reservations.
Median ages ranged from 23.5 for the Yavapai-Apache Reservation and 31.6 at Bagdad to 55.5 in Big Park
(the Village of Oak Creek) and 60.4 in Congress.
TABLE 4: Population and Median Age in Yavapai County Places, 2000
Region of Percent Share
County and Place Population Median Age 55 or Older
YAVAPAI COUNTY 167,517 44.5 34.9%
Central:
Prescott 33,938 47.8 40.1
Prescott Valley 23,535 37.3 26.7
Yavapai-Prescott Reservation 182 26.3 12.6
Southeast:
Black Canyon City 2,697 47.4 36.3
Cordes Lakes 2,058 46.7 39.0
Dewey-Humboldt 6,295 53.9 48.4
Mayer 1,408 43.7 31.9
Spring Valley 1,019 48.8 43.4
Northeast (Verde Valley):
Big Park 5,245 55.5 50.8
Camp Verde 9,451 42.0 32.0
Clarkdale 3,422 46.0 37.9
Cornville 3,335 41.4 24.7
Cottonwood 9,179 41.0 34.1
Cottonwood-Verde Village 10,610 42.0 32.3
Jerome 329 46.4 23.9
Lake Montezuma 3,344 44.7 34.4
Sedona* 10,192 50.5 41.7
Yavapai-Apache Reservation 743 23.5 12.4
Northwest:
Ash Fork 457 33.8 20.6
Bagdad 1,578 31.6 12.0
Chino Valley 7,835 39.8 27.0
Paulden 3,420 35.3 19.0
Seligman 456 40.6 30.2
Williamson 3,776 50.8 40.7
Southwest:
Congress 1,717 60.4 59.2
Peeples Valley 374 57.0 52.7
Wilhoit 664 50.4 42.9
Yarnell 645 56.6 52.7
* Includes the portion in Coconino County.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 2000 census.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 13
• Population increases have varied widely across Yavapai County. Most places in the county
experienced substantial population increases between 1990 and 2000, with Prescott Valley leading the
gainers with 166 percent growth. The slowest growth occurred in mining communities and on Indian
reservations, with Jerome’s loss of 18 percent the only negative number in the county.
• The median age of Yavapai County moved 2.1 years higher between 1990 and 2000. Most of this
upward trend in median age was due to the aging of baby-boomers, none of whom had reached age 55
in 2000, as well as the region’s continuing strong attraction as a retirement haven. Not all places posted
gains, however. While Jerome, Clarkdale, and Prescott saw substantial increases in median age, other
locations such as Lake Montezuma, the Sedona area, and Prescott Valley had their median age drop.
TABLE 5: Changes in Population and Median Age in Yavapai County Places, 1990 to 2000
Region of Change in Percent Share
County and Place Population Gain Percent Gain Median Age 55 or Older
YAVAPAI COUNTY 59,803 56% 2.1 -1.4%
Central:
Prescott 7,483 28 4.1 1.6
Prescott Valley 14,677 166 -0.4 -5.6
Yavapai-Prescott Reservation 6 3 4.0 6.9
Southeast:
Black Canyon City 886 49 -0.8 -5.8
Dewey-Humboldt 2,655 42 0.2 -0.1
Northeast (Verde Valley):
Big Park 2,221 73 -3.6 -4.1
Camp Verde 3,208 51 0.7 -2.9
Clarkdale 1,278 60 5.0 2.2
Cornville 1,246 60 4.0 -0.1
Cottonwood 3,261 55 2.2 -0.3
Cottonwood-Verde Village 3,573 51 -0.2 -4.4
Jerome -74 -18 6.4 1.8
Lake Montezuma 1,503 82 -7.2 -12.4
Sedona* 2,472 32 -1.4 -4.8
Yavapai-Apache Reservation 125 20 0.0 1.4
Northwest:
Bagdad 280 15 2.5 3.6
Chino Valley 2,998 62 2.0 -2.5
Note: 1990 data were not available for Cordes Lakes, Mayer, Spring Valley, Ash Fork, Paulden, Seligman, Williamson, Congress, Peeples Valley, Wilhoit, and Yarnell.
* Includes the portion in Coconino County.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1990 and 2000 censuses.
14 Morrison Institute for Public Policy
Finances of the Senior Population
Sources and level of income vary by age – as do expenditure patterns. According to the latest 1999 data (U.S.
Bureau of Labor Statistics Current Expenditure Survey), the average per capita income for seniors was 5 percent
higher nationally than for other age groups. In addition, senior income is much less dependent on wages and
salaries than income of younger age groups because it tends to be comprised mainly of Social Security and other
retirement benefits as well as dividends, interest, and income from rent.
Seniors also tend to spend more per person than other age groups. According to 1999 national data, households
headed by someone at least 55 years of age in 1999 had 17 percent higher expenditures per person than did
younger households nationally. Wealth is also higher among senior households nationally. According to the latest
1995 data released by the U.S. Bureau of the Census, median net household worth exceeded $80,000 in each age
group 55 or older, and was highest – over $100,000 – in households headed by someone in the 65-to-69 age
group. In comparison, the median net household worth for 45-to-54 year olds is considerably less at only
$60,000, and much lower for younger age groups.
While income and expenditure data by age group are not currently broken out for Yavapai County by the Bureau
of Labor Statistics or the Bureau of the Census, it is possible to estimate the county’s senior expenditures (see notes
following Table 7). Based on such estimates and other data, senior finances have the following impacts on the
Yavapai County economy:
• Personal income in Yavapai County strongly reflects senior influences. Nearly one-third of the
county’s total personal income for all age groups in 1999 was derived from dividends, interest, and rent,
compared to not quite one-fifth statewide and nationally. In addition, about 15 percent of Yavapai
County’s personal income came from retirement and disability insurance payments and Medicare,
compared to less than 10 percent in Arizona and the U.S. On a per person basis (see Table 6), retirement
and disability income per Yavapai County resident – and to a lesser extent, dividends, interest, and rent
– were considerably higher than the state or national averages in 1999. These modes of income tend to be
more stable than wages and other forms of earnings, and are therefore considered more “recession-proof.”
• Recent gains in personal income in Yavapai County have not kept pace with the nation. Between
the end of the last recession in 1991 and the most recent data published in 1999, per person gains in
personal income were less in Yavapai County than in the state or nation. Income gains were particularly
low in categories that affect senior income: Medicare; dividends, interest, and rent; and other transfers
such as public assistance and veterans’ benefits.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 15
TABLE 6: Per Capita Personal Income in Yavapai County, 1999
Yavapai Per Capita Ratio Ratio
Income to Arizona to U.S.
TOTAL $20,181 84% 72%
Portion of Total Due to:
Earnings 9,825 61 52
Dividends, Interest, and Rent 6,429 136 121
Retirement and Disability Insurance 2,332 171 168
Medicare 698 109 94
Other Transfers 896 76 60
INFLATION-ADJUSTED CHANGES 1991 TO 1999
TOTAL +11% -5 -6
Portion of Total Due to:
Earnings +19 -2 -1
Dividends, Interest, and Rent +2 -4 -15
Retirement and Disability Insurance +9 +6 -3
Medicare +12 -6 -21
Other Transfers +1 -9 -9
Note: Totals may not add due to rounding.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of Economic Analysis.
• Seniors provide more than their share of consumer spending. Estimates of senior expenditures (see
Table 7) show that they are responsible for more than 38 percent of the spending made by Yavapai County
residents, compared to their population share of not quite 35 percent.1
• Seniors have the greatest economic impact on health care. The 55 or older population accounted
for more than half of the expenditures in health care, exhibiting a per capita spending rate 2.5 times higher
than younger residents. The 55 or older population also had high expenditures for cash contributions to
charitable organizations, housing maintenance and repair, property taxes, reading materials, public trans-portation,
and insurance. In contrast, people 55 or older accounted for less than 30 percent of spending
on education, vehicle finance charges, mortgage payments, and rents.
• New senior migrants to Yavapai County account for an estimated $113 million of residential
construction annually.2 In total, they account for about 40 percent of the $281 million total value of
new residential construction in Yavapai County in 2000, assuming that seniors purchase only average-priced
homes, not more expensive ones.
• The net in-migration of seniors contributes significantly to the overall economy. Based on per
capita senior spending in 1999 of $16,575 and an average of 2,250 net senior migrants in a given year,
the addition of new senior residents every year adds at least $37 million in spending to the local economy.
This figure, however, does not reflect the much higher expenditures of first year residents who tend to
purchase more “big-ticket” items when they relocate – particularly a house, household furnishings, supplies,
and major services.
16 Morrison Institute for Public Policy
1 Estimates were made by multiplying 1999 national per capita expenditure figures by Yavapai County’s 2000 population count. Limitations of this methodology
are discussed in the notes for Table 7.
2 Calculated based on an average senior household size of 2.1 persons, net annual senior in-migration of 2,250 resulting in absorption of about 1,050 housing
units – of which approximately 900 are purchased – and an average value of a single-family building permit in Yavapai County during 2000 and the first half
of 2001 of slightly more than $125,000 excluding the cost of land.
TABLE 7: Estimated Expenditures by Residents of Yavapai County (In Millions of Dollars)
Expenditures Expenditures Share 55
Expenditure Category by Less Than 55 by 55 or Older Total or Older
TOTAL $1,532 $951 $2,483 38%
FOOD AND BEVERAGES 228 133 361 37
Food at Home 121 77 199 39
Food Away from Home 93 49 141 35
Alcoholic Beverages 14 7 21 34
HOUSING 489 296 785 38
Mortgage Interest and Charges 122 41 164 25
Property Taxes 42 38 80 48
Maintenance, Repair, Insurance, Other Expenses 29 33 62 54
Rent 95 37 132 28
Utilities, Fuels, Public Services 94 71 165 43
Household Operations 26 20 46 43
Housekeeping Supplies 20 15 35 43
Household Furnishings and Equipment 62 41 103 40
APPAREL AND SERVICES 76 41 117 35
TRANSPORTATION 302 169 471 36
Vehicle Purchases 145 76 221 35
Gasoline and Motor Oil 46 25 71 35
Vehicle Finance Charges 15 6 21 28
Maintenance and Repairs 27 18 46 40
Vehicle Insurance 31 20 52 39
Vehicle Rental, Leases, Licenses, Other Charges 23 11 34 31
Public Transportation 15 13 28 47
HEALTH CARE 60 86 146 59
Health Insurance 28 42 69 60
Medical Services 20 20 40 51
Drugs 9 19 29 67
Medical Supplies 3 5 8 58
ENTERTAINMENT 79 49 128 38
OTHER 101 60 162 37
Personal Care Products and Services 16 12 28 41
Reading 6 5 11 48
Education 31 9 40 23
Tobacco Products and Smoking Supplies 13 7 20 34
Miscellaneous 34 28 62 44
CASH CONTRIBUTIONS 37 52 89 58
LIFE AND OTHER PERSONAL INSURANCE 15 13 28 45
PENSIONS AND SOCIAL SECURITY 144 52 196 27
Note: Totals may not add due to rounding.
Additional Notes:
1. Assumes total per capita consumer spending is equal to the national average. Yavapai County figures are probably lower given the county’s
low per capita personal income and historically low household income.
2. Assumes distribution of spending among categories to be equal to the national average. Spending patterns in Yavapai County may be different.
3. Not all of the expenditures are made in Yavapai County. For example, some purchases by Yavapai County residents may be made in Coconino or Maricopa
counties.
4. Tourists, seasonal residents and businesses also make purchases in Yavapai County; these figures are unknown. Thus, the estimates in this table do not
represent total spending in the county.
5. Estimated spending calculated as 1999 national per capita average expenditures times the number of residents in Yavapai County in 2000. Those 55 or older
made up 35 percent of the county’s population.
6. The expenditures by senior industries components were estimated from the expenditure categories. Because of the many assumptions and approximations
necessary, the results should be interpreted cautiously. The financial and legal component could not be separately estimated.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research calculating from the U.S. Bureau of Labor Statistics, 1999 Consumer
Expenditure Survey, using 2000 decennial census counts.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 17
The Economy of Yavapai County
One important means of evaluating the economy of a local area is to mathematically compare it to the economy
of a much larger area. Such a comparison yields a “location quotient.” When the location quotient is greater than
1.0 (the national average) it suggests that the local industry’s concentration is relatively large, usually indicating
it is important to the local economy.3 For this study, location quotients were computed by comparing an industry
sector’s share of total county employment to the same sector’s share of total national employment.
Two data sources were used in this analysis – SIC and NAICS 4. These two systems vary in their names and
definitions for industry sectors so they are not closely comparable. Following are highlights of the most significant
characteristics of Yavapai County’s economy. Note that NAICS only compiles information on the private sector,
so public sector data are not included in any tables based on its statistics.
• Retail trade, health care and social assistance, accommodation and food services, and construction
dominate employment in Yavapai County. Each holds a double-digit share of county employment.
Together they account for more than half of total county employment. All are significantly influenced by
senior spending patterns – as well as by general population growth and seasonal residents.
TABLE 8: Employment in Yavapai County, 1999
Location
NAICS Sector Employment Share Quotient*
TOTAL 43,864 100.0%
Retail Trade 7,412 16.9 1.29
Health Care and Social Assistance 6,217 14.2 1.13
Accommodation and Food Services 6,144 14.0 1.61
Construction 4,916 11.2 2.00
Manufacturing 3,660 8.3 0.55
Administrative Support and Waste Management 2,170 4.9 0.65
Real Estate and Rental and Leasing 2,028 4.6 2.73
Other Services 1,992 4.5 0.98
Educational Services 1,496 3.4 1.55
Finance and Insurance 1,426 3.3 0.60
Wholesale Trade 1,369 3.1 0.58
Professional, Scientific, Technical Services 1,365 3.1 0.54
Arts, Entertainment and Recreation 941 2.1 1.45
Mining 844 1.9 4.68
Information 788 1.8 0.62
Transportation and Warehousing 623 1.4 0.43
Utilities 304 0.7 1.15
Note: Total does not add because data were not disclosed for some sectors.
* Shows the concentration of a sector’s employment relative to the national average of 1.0.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1999 County Business Patterns.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 19
3 Yavapai County’s small employment base for its size – about 20 percent less per capita than the national average – tends to slightly overstate the size
of these location quotients.
4 The old national Standard Industrial Classification (SIC) is currently in transition to the new North American Industry Classification System (NAICS).
The newer NAICS provides more detail by industry and is more reflective of our modern economy, while the older SIC system provides historical information
that can depict changes over time.
• Wholesale trade and finance/insurance/real estate experienced the fastest recent growth in
Yavapai County. With greater than 100 percent growth between 1991 and 1999 (i.e., since the end of
the last recession), wholesale trade and finance/insurance/real estate led all Yavapai County industries.
Construction and services (including health care) also experienced rapid growth – 83 percent and 69
percent respectively.
TABLE 9: Change in Employment in Yavapai County, 1991-1999
Employment
Location Change
SIC Sector Employment Share Quotient* 1991-99
TOTAL 69,494 100.0% 56%
Services (includes health care) 22,609 32.5 1.03 69
Retail Trade 13,896 20.0 1.22 47
Government 8,501 12.2 0.90 26
Construction 6,925 10.0 1.76 83
Finance, Insurance, Real Estate 6,762 9.7 1.23 101
Manufacturing 4,131 5.9 0.51 44
Wholesale Trade 2,127 3.1 0.67 109
Transportation, Communications, and Public Utilities 1,866 2.7 0.55 22
Mining 1,029 1.5 3.10 -13
Agricultural Services 924 1.3 1.06 60
Farm 724 1.0 0.54 22
* Shows the concentration of a sector’s employment relative to the national average of 1.0.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of Economic Analysis.
• The Prescott-Prescott Valley area dominates economic activity in Yavapai County. In 1997, more
than half of the county’s total employment and nearly half of its businesses were located in the Prescott-
Prescott Valley area. The same area also had the highest average payroll per employee in the county.
Second in both categories was the Verde Valley area, followed by the balance of the county. (The latest data
available from 1997 do not provide detailed information for specific unincorporated places in the county.)
TABLE 10: Establishments by Region in Yavapai County, 1997
Average Average
Number of Employment per Payroll per
SIC Sector Establishments Employment Establishment Employee
TOTAL* 4,870 42,425 9 $17,800
Prescott-Prescott Valley 2,380 23,260 10 $18,400
Verde Valley* 1,939 15,433 8 $17,100
Balance of County 551 3,732 7 $16,500
* Includes the portion of Sedona in Coconino County.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1997 Zip Code Business Patterns.
20 Morrison Institute for Public Policy
Composition and Size
of Senior Industries in Yavapai County
It is not possible to calculate the exact size of senior
industries in Yavapai County due to the nature of the
end market – nearly all goods and services consumed by
seniors are also purchased by the younger population.
But when national age group spending habits are
combined with Yavapai County demographic data, it
becomes possible to identify economic activities that are
of unusual size due, at least in part, to the county’s large
population of seniors.
The industry sectors most influenced by senior spending
include health care, construction, real estate, retail
trade, and most categories of services. Certain other
sectors considered to be part of senior industries are also
highly influenced by tourism, for example accommodation
and food services, and arts/entertainment/recreation.
This makes sense because tourism is ordinarily the first
essential step toward in-migration of seniors to an area,
thus the two industry clusters develop hand-in-hand.
Following is a closer look at each of the main component sectors of senior industries with particular attention
paid to the characteristics of health care and social assistance. Again, public sector data are not included in most
tables because they are not reported by NAICS.
• Several industry sectors influenced by seniors are unusually large in Yavapai County. Among the
sectors listed below, real estate and construction have the highest shares of employment compared to the
nation, but nearly all sectors are higher than the national average.
TABLE 11: Employment in Economic Activities Influenced By Seniors
in Yavapai County, 1999
Share of County Location
NAICS Sector Employment Employment Quotient*
Retail Trade 7,412 16.9% 1.3
Health Care and Social Assistance 6,217 14.2 1.1
Accommodation and Food Services 6,144 14.0 1.6
Construction 4,916 11.2 2.0
Other Services 1,992 4.6 1.0
Real Estate 1,779 4.1 3.7
Educational Services 1,496 3.4 1.6
Finance and Insurance 1,426 3.2 0.6
Arts, Entertainment, and Recreation 941 2.1 1.5
Utilities 304 0.7 1.2
Transit and Ground Passenger Transportation 116 0.3 0.8
* Shows the concentration of a sector’s employment relative to the national average of 1.0.
Source: U.S. Bureau of the Census, 1999 County Business Patterns.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 21
FIGURE 2:
Sectors Providing Direct Products
and Services to Seniors
Large Sectors
Health Care and Social Assistance
Construction
Retail Trade
Accommodation and Food Services
Medium Sectors
Real Estate
Educational Services
Finance and Insurance
Arts, Entertainment, and Recreation
Other Services
Small Sectors
Utilities
Transit and Ground Passenger Transportation
Sectors as classified by NAICS.
Health Care and Social Assistance
• Nursing and residential care is the most highly concentrated of all the health care and social
assistance subsectors. Within the subsector, two of its three largest industry groups are directly tied to
seniors: nursing care facilities (the largest industry group), and community care facilities for the elderly.
• Offices of medical professionals, medical labs, and outpatient care centers also have higher
shares in Yavapai County than in the nation. In particular, medical professionals other than doctors
and dentists (such as chiropractors, naturopaths, and therapists) had twice the share in Yavapai County
as in the nation.
TABLE 12: Employment for the Health Care and Social Assistance Sector
in Yavapai County, 1999
Location
NAICS Sector Employment Share Quotient*
TOTAL 6,217 14.2% 1.1
AMBULATORY HEALTH CARE SERVICES 2,231 5.1 1.3
Offices of Physicians 843 1.9 1.3
Offices of Dentists 390 0.9 1.4
Offices of Other Professionals 333 0.8 2.0
Outpatient Care Centers 262 0.6 1.2
Medical and Diagnostic Laboratories 110** 0.3** 1.8**
Home Health Care Services 158 0.4 0.5
Other 135** 0.3** 1.8**
HOSPITALS 1,740 4.0 0.9
NURSING & RESIDENTIAL CARE FACILITIES 1,522 3.5 1.5
Nursing Care Facilities 857 2.0 1.4
Mental Retardation/Health & Substance Abuse 312** 0.7** 2.0**
Community Care Facilities for the Elderly 350 0.8 1.9
Other 3** 0.0** 0.1**
SOCIAL ASSISTANCE 734 1.7 1.0
Individual and Family Services 272 0.6 0.9
Services for Elderly and Disabled 102*** 0.2 0.9
Community, Emergency & Relief Services 81** 0.2** 1.8**
Vocational Rehabilitation Services 139** 0.3** 1.1**
Child Day Care Services 242 0.6 0.9
Note: Totals may not add because data were not disclosed for some sectors.
* Shows the concentration of a sector’s employment relative to the national average of 1.0.
** Estimated: The federal government withholds data in sectors in which few companies operate.
*** These figures included in Individual and Family Services.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1999 County Business Patterns.
22 Morrison Institute for Public Policy
• The average number of employees per establishment for the health care and social assistance
sector in Yavapai County is only 13, well below the national average of 21. Offices of medical
professionals (doctors, dentists, and other professionals) make up nearly two-thirds of all the county’s
establishments in the sector.
TABLE 13: Establishments in the Health Care and Social Assistance Sector
in Yavapai County, 1999
Average Average
Employment Employment
Number Per Establishment Per Establishment
NAICS Sector of Establishments Yavapai U.S.
TOTAL 493 13 21
AMBULATORY HEALTH CARE SERVICES 359 6 10
Offices of Physicians 154 6 9
Offices of Dentists 72 5 6
Offices of Other Professionals 92 4 5
Outpatient Care Centers 20 13 24
Medical and Diagnostic Laboratories 5 22* 16
Home Health Care Services 14 11 46
Other 2 67* 26
HOSPITALS 3 580 718
NURSING & RESIDENTIAL CARE FACILITIES 54 28 42
Nursing Care Facilities 14 61 94
Mental Retardation/Health & Substance Abuse 9 35* 18
Community Care Facilities for the Elderly 29 12 27
Other 2 1* 24
SOCIAL ASSISTANCE 77 10 15
Individual and Family Services 27 10 17
Services for Elderly and Disabled 14** 7 21
Community, Emergency & Relief Services 5 16* 11
Vocational Rehabilitation Services 3 46* 38
Child Day Care Services 42 6 10
* Estimated: The federal government withholds data in sectors in which few companies operate.
** These figures included in Individual and Family Services.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1999 County Business Patterns.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 23
• Hourly wages for most health care occupations in Yavapai County closely parallel national
averages. Only speech pathologists and recreational therapists appear to receive well below average
wages. The small size of occupational samples in this data, however, may skew results based on specific
employment situations at the time of collection.
TABLE 14: Employment and Wages by Health Care Occupation in Yavapai County, 1999
Median Median Yavapai
Hourly Wage Hourly Wage Ratio
Employment Yavapai U.S. to U.S.
HEALTH CARE PRACTITIONERS &
TECHNICAL OCCUPATIONS 2,760 $17.49 $NA NA
Dieticians and Nutritionists 10 17.26 17.54 0.98
Pharmacists 60 33.33 32.16 1.04
Family and General Practitioners 70 60.15 54.34 1.11
Registered Nurses 1,140 18.00 20.33 0.89
Occupational Therapists 30 26.32 23.73 1.11
Physical Therapists 50 29.92 27.08 1.10
Recreational Therapists 50 10.08 13.47 0.75
Speech-Language Pathologists 30 14.59 22.03 0.66
Radiologic Technicians 110 15.67 16.47 0.95
Pharmacy Technicians 60 9.02 9.11 0.99
Licensed Practical and Licensed Vocational Nurses 130 14.60 13.39 1.09
Medical Records and Health Information Technicians 90 9.61 10.37 0.93
HEALTH CARE SUPPORT OCCUPATIONS 1,190 8.39 NA NA
Home Health Aides 230 8.22 8.21 1.00
Nursing Aides, Orderlies and Attendants 520 7.43 8.29 0.90
Occupational Therapist Assistants 10 15.63 15.79 0.99
Physical Therapist Assistants 20 14.97 15.90 0.94
Medical Assistants 250 11.61 10.48 1.11
Medical Transcriptionists 40 9.76 11.67 0.84
Medical and Public Health Social Workers 20 14.70 16.16 0.91
Note: Totals may not add because data were not disclosed for some occupations.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from Arizona Department of Economic Security,
Research Administration.
• Productivity per health care employee is lower than average in Yavapai County. Only two categories
of health care and social assistance (for which data were available) rose above national averages for receipts
per employee – home health care services, and offices of dentists – though the nursing care facilities
category was very close to average.
TABLE 15: Employee Productivity for Health Care and Social Assistance Sector
in Yavapai County, 1997
Total Receipts Average Receipts Yavapai
NAICS Sector (in Millions) Per Employee Ratio to U.S.
TOTAL $167.5 $55,600 0.83
AMBULATORY HEALTH CARE SERVICES 124.3 73,300 0.89
Offices of Physicians 59.7 90,700 0.83
Offices of Dentists 27.4 76,200 1.01
Offices of Other Professionals 15.8 58,600 0.84
Outpatient Care Centers 6.1 72,400 0.73
Home Health Care Services 7.5 39,800 1.26
NURSING & RESIDENTIAL CARE FACILITIES 37.7 35,100 0.93
Nursing Care Facilities 29.1 38,000 0.99
Community Care Facilities for the Elderly 8.0 27,900 0.77
SOCIAL ASSISTANCE 5.5 22,400 0.87
Note: Totals may not add because data were not disclosed for some sectors.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1997 Economic Census.
24 Morrison Institute for Public Policy
• Prescott hosts the greatest share of health care and social assistance activity in Yavapai County.
Among those sectors for which data were reported in 1997, nearly half of the county’s total health care and
social assistance establishments and employees – and more than half of total receipts – were concentrated
in the city of Prescott. Cottonwood had the second largest share with almost one-fifth of the total.
TABLE 16: Economic Activity by Yavapai County Place for Health Care
and Social Assistance Sector, 1997
Yavapai Camp Chino Cotton- Prescott Sedona Balance
NAICS Sector County Verde Valley wood Prescott Valley ** of County
Number of Establishments
TOTAL 377 13 7 68 175 30 34 49
AMBULATORY HEALTH CARE SERVICES 308 7 4 60 155 15 31 36
Offices of Physicians 125 36 66 10 6
Offices of Dentists 68 9 32 3 8 11
Offices of Other Professionals 86 9 42 13 14
NURSING & RESIDENTIAL CARE FACILITIES 40 4 4 13 8
Community Care Facilities for the Elderly 24 7 4
SOCIAL ASSISTANCE 29 3 7
Receipts (in Thousands of Dollars)
TOTAL $167,465 $6,927 $2,955 $30,422 $86,587 $7,454 $9,866
AMBULATORY HEALTH CARE SERVICES 124,259 1,320 24,457 68,804 5,672 12,444
Offices of Physicians 59,706 16,712 34,332 2,513
Offices of Dentists 27,361 2,537 12,181 1,912
Offices of Other Professionals 15,822 1,647 7,164
NURSING & RESIDENTIAL CARE FACILITIES 37,694
Community Care Facilities for the Elderly 7,969
SOCIAL ASSISTANCE 5,512 1,635
Annual Payroll (in Thousands of Dollars)
TOTAL $66,824 $2,544 $1,243 $13,777 $32,925 $2,932 $3,351
AMBULATORY HEALTH CARE SERVICES 48,578 285 11,887 25,336 2,160 5,105
Offices of Physicians 26,237 8,887 14,281 908
Offices of Dentists 8,330 889 3,322 489
Offices of Other Professionals 5,678 723 2,159
NURSING & RESIDENTIAL CARE FACILITIES 15,524
Community Care Facilities for the Elderly 3,055
SOCIAL ASSISTANCE 2,722 958
Employment
TOTAL 3,014 138 104 479 1,480 179 143 483*
AMBULATORY HEALTH CARE SERVICES 1,695 30* 19 338 910 96 128* 174
Offices of Physicians 658 207 340 49* 27
Offices of Dentists 359 38 172 17
Offices of Other Professionals 270 25 135
NURSING & RESIDENTIAL CARE FACILITIES 1,073
Community Care Facilities for the Elderly 286
SOCIAL ASSISTANCE 246 85
Note: Totals may not add because data were not disclosed for some sectors; blanks indicate data were not available.
* Estimated.
** Only the Yavapai County portion.
Source: Morrison Institute for Public Policy, data from ASU Center for Business Research using information from U.S. Bureau of the Census, 1997 Economic Census.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 25
26 Morrison Institute for Public Policy
Construction and Real Estate
• Construction is a highly concentrated industry in Yavapai County, particularly residential
building construction and land subdivision and development. The large size of the overall construction
sector in Yavapai County is a result of the county’s fast population growth and increased commercial activities.
Seniors are responsible for a major portion of that activity. The county is also above average for seasonal
housing units according to the 2000 census.
• Real estate activity is a very highly concentrated sector in Yavapai County. The portion of this
industry most affected by senior expenditures includes offices of real estate agents and brokers. These
offices are also impacted by overall population growth of the region.
TABLE 17: Construction and Real Estate Employment in Yavapai County, 1999
Location
NAICS Sector Employment Share Quotient*
CONSTRUCTION TOTAL 4,916 11.2% 2.0
BUILDING AND GENERAL CONTRACTING 1,460 3.3 2.4
Land Subdivision and Land Development 93** 0.2 3.5
Residential Building Construction 1,036** 2.4 3.5
Non-residential Building Construction 331** 0.7 1.1
HEAVY CONSTRUCTION 595 1.4 1.8
SPECIAL TRADE CONTRACTORS 2,861 6.5 1.9
REAL ESTATE TOTAL 1,779 4.1 3.7
LESSORS OF REAL ESTATE 176 0.4 0.9
OFFICES OF REAL ESTATE AGENTS/BROKERS 202 0.5 2.0
ACTIVITIES RELATED TO REAL ESTATE 1,401 3.2 7.3
Real Estate Property Managers 1,200*** 2.7 7.8
Other Real Estate Activities 201*** 0.5 5.1
* Shows the concentration of a sector’s employment relative to the national average of 1.0.
** These figures included in Building and General Contracting.
*** Estimated; these figures included in Activities Related to Real Estate.
Retail Trade and Services
• Gambling industries are extremely concentrated in Yavapai County. The region’s two Indian-run
casinos tend to be strongly supported by an older population, routinely drawing senior participants from
outside the region. Thus, the gambling industry could be considered one of the few export-oriented
components of senior industries in Yavapai County.
• Several service sectors are strong in Yavapai County. Among those that are most highly concentrated
are amusement/gambling/recreation, food services and drinking places, and educational services. The first
two are also strongly influenced by tourism.
• Most retail subsectors are only moderately concentrated. The subsector influenced by senior spending
that showed the highest concentration is building materials and garden equipment dealers, a subsector
that is tied to construction and landscaping of new homes.
TABLE 18: Retail Trade and Services Employment in Yavapai County, 1999
Location
NAICS Sector Employment Share Quotient*
RETAIL TRADE TOTAL 7,412 16.9% 1.3
MOTOR VEHICLES AND PARTS DEALERS 934 2.1 1.3
FURNITURE AND HOME FURNISHING STORES 281 0.6 1.4
ELECTRONICS AND APPLIANCE STORES 147 0.3 1.0
BUILDING MATERIAL AND GARDEN SUPPLY 843 1.9 1.8
FOOD AND BEVERAGE STORES 1,545 3.5 1.3
HEALTH AND PERSONAL CARE STORES 339 0.8 0.9
GASOLINE STATIONS 629 1.4 1.7
CLOTHING AND ACCESSORY STORES 430 1.0 0.8
SPORTING GOODS, HOBBIES, BOOKS, MUSIC 264 0.6 1.1
GENERAL MERCHANDISE STORES 1,250 2.9 1.3
MISCELLANEOUS STORE RETAILERS 563 1.3 1.7
NON-STORE RETAILERS 187 0.4 0.9
ACCOMMODATION AND FOOD SERVICES 6,144 14.0 1.6
ACCOMMODATION 1,207 2.7 1.8
FOOD SERVICES AND DRINKING PLACES 4,937 11.3 1.6
OTHER SERVICES 1,992 4.6 1.0
REPAIR AND MAINTENANCE 770 1.8 1.5
PERSONAL AND LAUNDRY SERVICES 436 1.0 0.9
RELIGIOUS, CIVIC, SOCIAL ORGANIZATIONS 786 1.8 0.8
EDUCATIONAL SERVICES 1,496 3.4 1.6
FINANCE AND INSURANCE 1,426 3.2 0.6
CREDIT INTERMEDIATION (Banking and Related) 835 1.9 0.8
SECURITIES AND COMMODITIES 133 0.3 0.4
INSURANCE CARRIERS AND AGENTS 458 1.0 0.5
ARTS, ENTERTAINMENT AND RECREATION 941 2.1 1.5
PERFORMING ARTS AND SPECTATOR SPORTS 103 0.2 0.8
MUSEUMS AND HISTORICAL SITES 46 0.1 1.2
AMUSEMENT, GAMBLING, RECREATION 792 1.8 1.7
Gambling Industries 310** 0.7 4.4
Other Amusement and Recreation 480** 1.1 1.4
UTILITIES 304 0.7 1.2
TRANSIT AND GROUND PASSENGER
TRANSPORTATION 116 0.3 0.8
Note: Totals may not add because data were not disclosed for some sectors.
* Shows the concentration of a sector’s employment relative to the national average of 1.0.
** Estimated; these figures included in Amusement, Gambling, Recreation.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 27
Dynamics of Senior Industries in Yavapai County
Relationships Among Senior Industries Components
Flourishing industry clusters typically develop complex relationships that link together all levels of the cluster
hierarchy, from markets to foundations. These types of relationships tend to reduce costs for supplies and increase
innovation, and they keep cluster members aware of industry trends and new solutions. In short, these relationships
can be highly synergistic. Senior industries, however, spans a cross-section of the overall economy of the region,
and in doing so it encompasses industry sectors that normally wouldn’t develop close connections. Consequently
most inter-business linkages in senior industries tend to be focused within the individual components – such as
within the health care sector or within the construction sector, but not between the health care and construction
sectors. Therefore, very few joint ventures or marketing efforts tie separate sectors together.
Informal linkages, however, occur frequently among business leaders due to the county’s relatively low population.
They occur because small communities usually require residents to wear many different “hats” in their day-to-day
lives and, consequently, business people tend to cross each other’s paths through participation in civic organizations,
trade groups, or boards. In Yavapai County, some popular organizations for leaders of senior industries are county-wide,
but most tend to be restricted in scope to one or another of the distinct geographic and economic regions of
the county, primarily the tri-city area (Prescott-Prescott Valley-Chino Valley) or the Verde Valley.
Among the most prominent types of relationships that exist among Yavapai County senior industries business
components are the following:
• Direct business-to-business relationships drive commerce within industry sectors. These
relationships are essential in order for businesses to develop reliable suppliers and buyers for their
products and services. For example, a home builder in Prescott must contract with local materials
suppliers and building specialists in order to complete construction projects, and must also work
with area realtors and lenders to market and sell the finished products.
• Businesses rely on industry networks to coordinate service delivery to customers. Formal and
informal networks provide referrals and support for complex business activities. For example, seven funeral
homes in the Verde Valley work together informally to provide each other with assistance when necessary.
Also, the Yavapai Regional Medical Center accommodates or coordinates with a number of individuals
and businesses, including ambulance services, physicians, law enforcement agencies, churches, florists,
social workers, hospice organizations, and long-term care facilities, among others.
• Many businesses rely on trade associations and industry interest groups. Some industry groups
offer specific, business-related functions. For example, the local home builders association provides infor-mation
and political advocacy for building contractors, and a national construction retail association
offers group purchasing power for a small retailer in Prescott Valley. Other organizations, such as the
Verde Valley Senior Care Providers provide information and policy discussion on rapidly changing issues
related to health care.
• Public-private partnerships leverage money and human resources. Governments and the private
sector often collaborate to accomplish projects that might not be feasible for either party to undertake
individually. One example is the senior center in Prescott, which is owned by a private company but
staffed and maintained by city personnel. Another example is C.A.T.S. (Cottonwood Area Transit
System), in which a private bus company obtains federal and local government funds to help operate a
public transportation network in four Verde Valley communities.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 29
• Most businesses maintain working relationships with area institutions. Connections between
businesses and institutions are usually direct. For example, workers in several fields – particularly health
care – receive worker training and continuing education classes from Yavapai College; assisted living
facilities in Yavapai County contract directly with the county’s Department of Medical Assistance; and
most businesses engage in regulatory and tax issues with local government agencies. In addition, many
indirect connections exist. These often derive from business people assuming public office or serving on
economic development foundations, planning commissions, and other institutional boards.
• Yavapai County Indian Tribes engage directly in local economic and social affairs. Tribal enterprises
play a leading role in the regional economy through the marketing and operation of popular enterprises
such as gambling casinos, conference facilities, and shopping centers. The tribes and their enterprises
also rank as leaders in civic involvement and charitable giving through their support of area schools and
public service organizations, and participation on regional boards.
Senior Industries Drivers
Yavapai County’s senior industries benefit from an attractive location and a mild climate that combine to foster a
desirable lifestyle for retirement-age people. These factors and many others act as economic ���drivers” – external
and internal forces that affect how, where, and to what extent senior industries will grow. External drivers include
natural resources, trends, and events that mainly lie beyond the control of the local community. Internal drivers
include assets, policies, and services that primarily reside within the community’s sphere of influence. Among the
external and internal factors affecting senior industries in Yavapai County are the following:
FIGURE 3: Forces Affecting Yavapai County Senior Industries
30 Morrison Institute for Public Policy
Climate &
Weather
Demographics
Outdoor
Recreation
National
& Worldwide
Economic
Performance
State
& Federal
Policies
Quality
of Life
Marketing
& Economic
Development
Growth
Management
Workforce
& Customer
Service
Transit
Medical
Services &
Long-term Care
Availability
Housing
Availability
& Cost
Natural
Environment
Water
Resources
Major News
& Events
Internal
Drivers
External Drivers
External Drivers
• Climate and Weather. Yavapai County encompasses a wide range of elevations and temperatures, but
overall the weather is relatively mild with at least some evidence of all four seasons. Such a climate is
attractive for both out-of-state and in-state visitors: it appeals to northern migrants who see it as warm
but not overly hot, and to urban desert dwellers who view the climate as refreshingly cool.
• Natural Environment. Open space and clean air are among the natural attractions of Yavapai County.
Also significant are the region’s signature red rock cliffs, imposing mountains, expansive pine forests, scenic
waterways, designated wilderness areas, and abundant wildlife. Possible threats to these assets could arise
from inappropriate development, degradation of scenic vistas, drying of streams and springs, or pollution
of air and water.
• Outdoor Recreation. Residents and visitors see the region’s open spaces as a priceless outdoor recreation
playground because much of the land is federal or state owned. Threats to open spaces could come from
overcrowding of popular recreation areas, severe resource damage from fire or other causes, or loss of
access to open spaces.
• Water Resources. Residents and visitors expect water to flow whenever they open their faucets. Should
serious water shortages occur, senior migration into Yavapai County would likely cease. Even the threat
of a water shortage could reduce the rate of new in-migrants.
• Demographics. The U.S. population is aging and Yavapai County is leading the way. This trend is robust
not only because people are tending to live longer and produce fewer offspring, but also because the
largest age group in the U.S. – baby-boomers – will soon begin swelling senior age groups. This is an
extremely positive sign for places seeking to attract seniors, but the threat is that a larger elderly
population will increase demands on a service labor pool that could be shrinking.
• Major News and Events. Positive media coverage of an area can boost visitation and interest in real
estate, leading to an increase in the number of senior relocations there. Prescott and Sedona have experienced
this effect in the past. Such a trend, however, could suddenly reverse should media reports turn sour.
• National and Worldwide Economic Performance. Strong national and international economic
performance tends to boost senior wealth because most seniors benefit from some form of investment in
financial markets. A protracted slump in the economy, however, could reduce disposable senior income
and diminish migration.
• State and Federal Policies. A wide range of government policies can affect the desirability of an area for
retirement. Low state tax rates, for example, would be seen as a positive factor, while federal decisions to
open up scenic areas to strip mining or oil drilling would be considered negative.
Internal Drivers
• Quality of Life. An important attraction to in-migrating seniors is the region’s quality of life. In Yavapai
County the desirable qualities most often mentioned include a small town atmosphere, low crime rate,
manageable traffic, informal lifestyle, and plenty of activities oriented toward an older population.
• Housing Availability and Cost. Newly arrived seniors need housing, and it appears obvious that the
construction and real estate industries must be able to supply it. Less obvious is the fact that workers who
serve a senior population also need suitable housing. One major obstacle for workers is that the costs of
housing in and near retirement areas tends to be too high for their income levels. Failure to provide
affordable worker housing could leave the region short on labor.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 31
• Medical Services and Long-term Care Availability. Maintaining optimum capacity for medical and
long-term care needs is critical. Too much capacity causes businesses to lose money; too little capacity
causes seniors to receive poor service. Health care industry planners must achieve a difficult and dynamic
balance to properly serve senior clients.
• Transit. One of the isolating effects of aging is losing the ability to get out for shopping, socializing, and
health care. While this problem appears greatest for low income elders, even the wealthy can suffer. Safe
and efficient modes of public transit that consider the special handicaps of age can ameliorate this isolation
and help seniors maintain their independence.
• Workforce and Customer Service. Elderly seniors tend to require higher levels of service than many
younger age groups. For a retirement area to remain attractive to seniors over time, it must maintain an
adequate pool of service workers and a high level of customer service. Currently, Yavapai County’s labor
pool is comparatively small.
• Growth Management. Relocating seniors often voice opposition to growth in their new communities in
order to protect the qualities that drew them in the first place. While freezing growth might not be in the
region’s best interests – either economically or in terms of providing services – management policies that
protect the community’s primary assets are essential to maintaining the area’s attraction.
• Marketing and Economic Development. Focused efforts to market Yavapai County as an attractive
retirement location will potentially increase revenue for the businesses that serve them. Tourism marketing
to older age groups is also likely to benefit senior industries.
Competitors
In addition to the push and pull of economic drivers, Yavapai County also faces competition from other retirement
destinations. Among the competitors for relatively well-heeled and active seniors are the following:
• Planned retirement communities. Master planned retirement areas in other parts of Arizona, such as
Sun City and its derivatives, have captured a large segment of the existing retiree market because they have
geared leisure activities and lifestyles exclusively toward older people. These retirement communities in
metropolitan settings can also provide a wider range of housing prices and deeper medical/health care
infrastructure than can more rural settings. However, as the baby-boom generation reaches retirement age
over the next few decades, attitudes of these new seniors are likely to change and monolithic retirement
villages may not hold the same attraction as they have in the past.
• Rural West. Many small cities and towns in Arizona and other western states – such as Colorado, Utah,
and Nevada – have been luring active seniors in recent years. Key to the appeal of these areas is their quality
of life, but other factors also influence senior relocation decisions including climate, the availability of
services, local cost of living, and the financial bite of tax laws.
• Southern coastal states. Seniors whose top priority is a warm climate and access to water have also chosen
to retire in states such as Texas, the Carolinas, and especially Florida. Potential advantages of these areas
include the possibility of a beach lifestyle, greatly reduced temperature extremes, and the likelihood of living
closer to family and long-time friends. Some of these areas, however, suffer from over-popularity which
has led to reduced quality of life and future resource problems.
32 Morrison Institute for Public Policy
• Home towns. Many seniors choose not to leave home when they retire. The percentage of those who
select this option may begin to increase if developers and institutions in “home towns” across the country
find ways to make senior living more attractive. The advantage of staying home is remaining close to family
and friends (assuming they don’t relocate elsewhere). Nevertheless, large numbers of footloose retirees will
continue to flock to Arizona – at least seasonally – as long as the quality of life in the state remains high.
Requirements for Growth and Vitality
Leaders of Yavapai County senior industries say they want both their businesses and the region’s infrastructure
prepared to serve a growing senior population. To accomplish this goal, they have identified a number of requirements
for maintaining and improving the health of senior industries. Based on analysis of formal interviews conducted
with a wide variety of people representing a cross-section of the region’s businesses and institutions related to senior
industries, the future needs of senior industries in Yavapai County include the following:
• Adequate workforce. In order to provide needed services for a growing senior population, a sufficient
pool of workers must be obtained, trained, and retained. Unless employers find success in all three areas,
services will decline.
• Education on aging and end-of-life decisions. Family and volunteer caregivers need to have a better
understanding of the financial, legal, and medical realities of aging and death.
• Adjustments in Medicare reimbursements and reduction in medical liability. Without higher
Medicare reimbursements for services, doctors will avoid taking on geriatric patients. And until the
potential for liability is reduced when treating geriatric patients, every death – even the most “natural” –
could lead to a lawsuit.
• Improved public amenities for seniors. Many areas of the county need larger and better stocked
libraries. Seniors also need more walking paths, bike trails, and other opportunities for outdoor exercise
in order to maintain a healthier lifestyle.
• Improved/expanded public transportation. A better system of public transit would benefit not only
elderly seniors who are unable to drive, but also many of the workers needed to serve them whose low
pay precludes buying a car.
• Resolution of water resource issues. Uncertainty over water supplies can dampen growth, but no one
wants growth to exceed the supply of water.
• More regional cooperation. Regional thinking and cooperation is needed on issues such as public transit,
traffic mitigation, affordable housing, planning and zoning, and the plight of uninsured workers.
Piecemeal approaches fail to get the job done and make regulatory issues unwieldy for businesses.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 33
Opportunities for Collaborative Action
The primary objective of this study is to foster strategic
planning for the future of senior industries in Yavapai
County. Interviews conducted for this research, however,
revealed that some sectors of senior industries – such as
the construction and health care sectors – are poorly
connected with each other, if at all. While businesses in
different sectors may not immediately see an obvious
day-to-day economic reason to join forces, it is clear
that they are closely intertwined through their common
market – seniors – and the enormous influence of
senior spending. Moreover, economic circumstances
that favor one sector can impact the other. For example,
a boom in growth would boost revenue for builders, but
could also eventually lead to capacity shortfalls in health
care or resource problems affecting other sectors of
senior industries. Consequently all sectors must be in
balance with each other in order for Yavapai County to
remain an attractive retirement location. For this reason, a
working group of leaders from the component sectors of
senior industries as well as related governments and
institutions should work together on common goals.
Below are a number of long-term strategies to strengthen senior industries and position it for the future. Not every
suggestion is likely to be feasible at any given time, nor is every one necessary to keep the industry healthy. It is,
however, recommended that initiatives be prioritized based on active local support. Then top priority goals should
be matched to willing “champions” who can provide leadership and oversight.
Workforce
• Bolster the labor pool. Yavapai County has a smaller than average labor pool and senior industry
leaders say they can’t find, train, and retain enough workers to keep their operations running smoothly.
Several ideas have been floated for recruiting more workers. These include drawing from the ranks of high
school students, tapping the flow of immigrants crossing the Mexican border, and recycling retired
seniors back into the workforce. Each of these strategies raises additional issues that would have to be
addressed (e.g., language barriers and housing needs for immigrants; chronic injuries for older workers),
therefore practical plans need to be formulated. Once new workers are found – particularly in health care
– they need specialized training before they can become effective. While certification training for new
health care workers appears to be satisfactory in general, some employers feel it could be made more timely
for their needs – for example, by scheduling more intense training periods that result in shorter time to
certification. Much more important, however, is the need for employers to find new ways to retain
workers once they are recruited and trained. Possible incentives would include the prospect of advance-ment
and higher pay, the availability of affordable housing, convenient public transportation for
reaching the work place, good working conditions and medical benefits, and the advantages of the
public amenities and unspoiled natural environment of the area. Some of these potential incentives are
discussed further under Infrastructure.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 35
FIGURE 4:
Long-term Strategies to Keep
Senior Industries Healthy
Workforce
Bolster the labor pool
Reduce labor needs by increasing worker productivity
Health Care Capacity
Keep the elderly functional and productive
Educate about aging; aid unpaid caregivers
Address Medicare and medical liability challenges
Infrastructure
Protect natural assets and quality of life
Assure adequate distribution of facilities for senior health care
Expand public transit for seniors and workers
Address affordable housing needs of seniors and workers
Think and plan regionally
Economic Development
Develop exports
Lead with senior industries
• Reduce labor needs by increasing worker productivity. The size of the labor force required to serve
seniors can be reduced by making employees more productive, but usually this is easier said than done.
One possible approach for health care is to invest in interactive technologies that can help diagnose and
prescribe treatment of medical conditions for remote patients without face-to-face contact. Approaches
for long-term care include deployment of sophisticated electronic monitoring systems that allow fewer
staff to effectively supervise elderly residents, and the use of assistive technologies (e.g., lifts) to reduce
staff exertion and injuries.
Health Care Capacity
• Keep the elderly functional and productive. Maintaining the function and independence of elderly
seniors has the potential to benefit the economy – for example, through continuing productive employment
or volunteer services, and also through reduced public expense for such things as long-term care and other
services. One way to accomplish this, according to recent research, is to provide a mentally and
physically stimulating setting for the elderly. With this in mind, efforts should be made to integrate elderly
seniors into the region’s rich cultural community and thereby reduce their potential for isolation and
decline. Strategies include increasing the availability of senior housing close to cultural centers, expanding
public transit for the elderly, providing easily accessible exercise programs and facilities for seniors, offering
assistive devices (e.g., walkers, handrails) to needy seniors, and engaging seniors in volunteer service or
part-time employment.
• Educate the populace about aging; provide services for unpaid caregivers. Tremendous advances
in health care have reduced the threats of many common diseases and increased human life expectancies,
but they have also encouraged unrealistic expectations for the care of the aged. This discourages
doctors and other medical professionals from specializing in geriatric medicine. Moreover, it leads many
elderly seniors and their families to delay preparation for end-of-life issues. These situations might be
mitigated by educating the families of elderly seniors on the legal, financial, medical, and emotional
aspects of old age and death. Appropriate information could be made available through seminars, college
courses, counseling, pamphlets, the internet, or other conduits. Meanwhile, expanded life spans have also
placed increased burdens on unpaid caregivers (e.g., family and friends) who must juggle families,
careers, and personal pursuits with their commitments to elderly dependents. These volunteer caregivers
can greatly expand the long-term care capacity of the community and reduce public costs for such care,
but the expense to their lives is sometimes too high for them to continue their commitment. They would
benefit from training and timely advice on how to manage their elderly charges throughout the various
stages of aging, as well as periodic respite from their caregiving duties through a network of support
services, such as adult day care.
• Adjust Medicare/Medicaid reimbursements and address medical liability challenges. A combination
of low Medicare/Medicaid reimbursements and liability threats could undermine attempts to improve
capacity for senior care. Already, seniors on Medicare without supplemental insurance have difficulty
finding physicians because low Medicare reimbursements lead medical offices to limit the number of these
patients they will accept. Similarly, long-term care reimbursements from Medicaid (administered in
Arizona by ALTCS – Arizona Long Term Care System) often fail to cover costs of service. Liability
challenges also threaten capacity. Physicians have been discouraged from treating geriatric patients or
seeking a specialty in geriatric medicine because of the increased potential for lawsuits. And long-term
care facilities have been hit by sharp increases in liability insurance and little choice among carriers. While
resolution of these issues is under the purview of state and national lawmakers, a grassroots lobbying effort
may be needed to convince state legislators and the Arizona Congressional delegation they should take
action to find practical solutions.
36 Morrison Institute for Public Policy
Infrastructure
• Protect the region’s natural assets and quality of life. The beauty of Yavapai County’s natural
environment and the small town ambience of its cities and towns provide two of the county’s biggest
economic assets; they act as powerful magnets for tourists, retirees, and second home buyers. The
population growth that results from these magnets, however, inevitably threatens their attractiveness,
therefore they require some means of protection if they are to survive. As a basis for planning suitable pro-tection
strategies, an inventory should be conducted of the most desirable assets and values of the region.
• Assure adequate distribution of facilities for senior health care throughout the county. Yavapai County
is at the leading edge of a national trend toward mushrooming of the senior population in coming decades.
Currently, most health care facilities reside in Prescott. In order to meet growing demand for senior services
in other parts of the county, business and government leaders will need to cooperatively guide future
distribution of medical and emergency facilities throughout the region.
• Expand public transit offerings for seniors and workers. Both seniors and the workers who serve
them require transportation – seniors to maintain their independent living, and workers to reach their
work place, which is often far from home. Elderly seniors, however, tend to lose their ability to drive
as they age, and the workers who serve them frequently can’t afford a reliable vehicle. This combina-tion
complicates service delivery. A reliable regional system of subsidized public transit would go a
long way toward reducing isolation of the elderly, bolstering the labor force, and assuring health care
capacity for seniors.
• Address affordable housing needs of seniors and workers. Many elderly seniors need affordable
housing near community and medical services, and the workers who serve them need affordable housing
near the seniors they serve. While worker housing issues plague most economically successful American
communities, a number of experiments are underway in resort towns and major cities across the West.
Case study of these projects could provide useful ideas on how Yavapai County could mitigate affordable
housing shortages for elderly seniors and workers.
• Think and plan regionally. Most of the issues facing senior industries in Yavapai County cannot be
resolved effectively at the local municipal level. In order to succeed with long-term solutions, business,
tribal, and government leaders across the county must think regionally and work together cooperatively
to implement regulations and allocate resources.
Economic Development
• Develop exports. Senior spending plays a major role in the economy of Yavapai County. As a potential
cluster, however, senior industries will not truly drive the economy forward until it attracts or spawns sub-stantial
export-driven businesses. One way this could occur is under a scenario in which the area attracts
an active research community interested in carrying out clinical studies of products developed for older
age groups. In another scenario, local residents might invent or manufacture innovative products that
benefit an aging population or their care providers. Either situation – or others – could create high quality
jobs and improve the prospects of the region’s workers and businesses, while also providing special, local
benefits to Yavapai County’s seniors.
• Lead with senior industries. Arizona is said to lack a clear economic identity, yet Yavapai County
already enjoys a national reputation as a retirement haven. While this reputation has undoubtedly contributed
to a number of growth-related issues that must be solved over the long-term, it might be wise to treat this
reputation as a long-term economic opportunity, rather than a problem. One strategy would be to shore
up weak areas – such as the aforementioned workforce, health care capacity, and infrastructure issues –
and then actively promote the county as an exemplary retirement location.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 37
Appendix A
Interviews Conducted
During September and October of 2001, a total of 24 formal interviews were conducted with individuals representing
diverse interests and locations. Names, titles and affiliations are given as of the time of interview.
Name Title Company/Organization
Tri-City Area*
Larry Asaro City Manager City of Prescott
Tim Barnett CEO
Mardy Taylor Chief Nursing Officer Yavapai Regional Medical Center (Prescott)
Dave Corbeille Owner Authentic Building Supply (Prescott Valley)
Bob Folger Realtor Lindquist Realtors (Prescott)
John Goodman Pharmacist & Owner Goodwin Street Pharmacy (Prescott)
Gary Marks Executive Director Prescott Valley Economic Development Foundation
Gary Olson Administrator Mountain View Manor (Prescott)
Robert Pecharich Partner Boyle, Pecharich, Cline & Whittington (Prescott)
Joel Petersen Manager Wal-Mart (Prescott)
Marilyn Rabideau Council Member Town of Prescott Valley
Karen Rizk V.P., Commercial
Loan Officer National Bank of Arizona (Prescott)
Carl Tenney Town Manager Town of Chino Valley
Verde Valley Area
Michael Bluff
Council Member Town of Clarkdale
V.P. & General Counsel Mingus Construction
Brenda Hauser Mayor Town of Camp Verde
Ken Johnson Stockbroker Edward Jones (Sedona)
Dr. Frank Nagy Medical Director Kachina Point Health Care and Rehabilitation Center (Sedona)
Steve Palmer Owner/Director Westcott Funeral Home (Cottonwood/Camp Verde)
Shirley Scott Transportation Manager Cottonwood Area Transit System
Linda Stevenson Executive Director Verde Valley Caregivers (Sedona)
Tribal
Stan Rice, Jr. President
Ernie Jones Vice-president Yavapai Prescott Indian Tribe
Gary Swigart Personnel Manager
Regional
Mona Berkowitz Director Yavapai County Department of Medical Assistance
Henry Camarot District 1 Representative Arizona House of Representatives
Doreen Dailey President Yavapai College
Other County
June Kellett Project Director Mayer Senior Nutrition Project and Mayer Elders Center
*Prescott, Prescott Valley, and Chino Valley.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 39
Appendix B
Summary of Comments and Group Discussion
January 25, 2002
The initial public presentation of Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries was
conducted at Yavapai College in Prescott on January 25, 2002. Following this presentation, two activities took
place. First, representatives of Yavapai College commented on the findings of the report and the college’s role in
providing leadership and support to resolve issues facing senior industries. Second, members of the audience
representing a cross section of regional interests discussed issues related to the report’s findings and suggested
strategies for collaborative action.
Yavapai College Comments
Four representatives from Yavapai College – including the president, vice-president for economic development,
and two consultants on aging issues – offered brief remarks. Among their comments were the following:
• Yavapai County’s current demography is a precursor of what the rest of the nation will experience in the
next two or three decades, therefore it can provide leadership on aging issues. For example, the county
can serve as a model for sustaining an aging population, and it can serve as a “living laboratory” for
research on aging.
• Leaders of senior industries and public institutions in Yavapai County should use the research provided
in Gray Matters to move forward in addressing aging issues. In particular, medical and mental health care
need relief from a financial crisis caused by federal funding cuts.
• The region needs to think broadly about how to expand its workforce. For example, it should provide
more amenities that appeal to a younger population in order to attract and retain young workers who are
critical for entry-level service jobs.
• County residents should be educated to look at aging as an “incremental process” (an increase in wisdom)
instead of a “decremental process” (a mental or physical deterioration). They need to appreciate what
seniors bring to the county – their financial resources, experience, volunteer efforts, and charitable works.
• Yavapai College is well positioned to offer leadership and support on a number of issues related to senior
industries and aging. The college currently provides worker training for senior industries, cultural
programs and classes that attract seniors, and a variety of degree programs for all ages. For the future, the
college is developing a gerontology curriculum to educate on aging-related topics, and it has proposed a
Center for Productive Aging to keep elderly residents engaged and active. The college can also advance
the use of technology to increase access to health care in remote areas.
40 Morrison Institute for Public Policy
Group Discussion
Members of the audience were asked to address four categories of proposed collaborative actions presented in the
report: workforce, health care capacity, infrastructure, and economic development. Among their comments were
the following:
Workforce
• Consideration should be given to the capabilities and limitations of different populations of workers, such
as high school students and returning retirees. One goal that can be accomplished very quickly is to
identify which job openings are most appropriate for different segments of the workforce, and specify the
training and skills they require.
• A recent increase in national chain stores in the region has limited local control over wages. The national
headquarters of these stores tend to dictate low pay scales.
• More good jobs are needed for younger workers. Low wages in the region cause many to move to Phoenix
or other large cities in search of higher paying jobs.
• Although new immigrants from Mexico are a potential source of workers for the region, it is not necessary
to recruit them because Yavapai County already contains a large population of Mexican immigrants who
are underutilized. Instead, the region needs effective bilingual education and training programs to give
these workers greater language and job skills.
• Senior women have proven to be excellent in-home care workers because they have experience in caring
for others, are willing to work part-time, and are not discouraged by low pay. Lack of transportation,
however, is a major obstacle for them.
• Entry level workers need to be shown a career ladder that can lead them to increasing skill levels and higher
pay. For example, a hospital orderly should understand the steps needed to become a nurse.
• Workers need incentives to come to the region and stay. One idea for recruiting nurses is to provide free
tuition to nursing students who commit to working in the county for a period of time.
Health Care Capacity
• Senior centers around the region need to reexamine their services in light of demographic trends that
show people retiring younger and healthier. To better serve this younger senior population, they might
offer appropriate exercise programs or other activities that attract active retirees.
• The region should solicit a “retirement” radio program that is devoted to seniors. This radio program
could serve as a platform for educating the populace on aging issues.
• More doctors could be attracted to the region if they were provided incentives such as free office space in
return for a commitment to take on current residents as patients. Attracting a Mayo Clinic branch could
also increase health care capacity and provide an export function.
• Adjustments must be made in federal and state funding formulas, which currently favor metropolitan
counties over rural counties for medical and mental health care. It is not appropriate for metropolitan
areas to receive higher reimbursements under Medicare, ALTCS, and Veterans Administration programs,
when the costs for providing care in rural areas are the same or higher.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 41
Infrastructure
• More child care services are needed for working parents, especially 24-hour operations that can
accommodate night shift workers.
• Transportation is a serious problem for seniors and workers. The area currently offers very little in the way
of public transit, therefore it has the opportunity to create a regional solution.
Economic Development
• The region’s challenge is to take the assets it already has – a large senior population and related services
and facilities – and use these assets to make Yavapai County a model for addressing senior care issues and
other age-related concerns. One approach could be to create or attract research institutions that would be
regionally based, such as a local Mayo Clinic branch.
• The county does not need to create more jobs because unemployment is already very low. Instead, it needs
to attract more workers.
42 Morrison Institute for Public Policy
References
America’s Changing Work Force: Statistics in Brief, American Association of Retired Persons, 1998.
Butler, Robert N., ed., “The Future of Geriatric Medicine: A National Crisis Looms,” Aging Today,
July/August 2001, 9-12.
Coward, Raymond T. and Gary R. Lee, eds., The Elderly in Rural Society, Springer Publishing, 1985.
Drucker, Peter, 2001. “The New Demographics: How to Live with an Aging Population,” The Economist,
Nov. 5-7.
Hooyman, Nancy R., A. Asuman Kiyak, Social Gerontology: A Multidisciplinary Perspective, (4th ed.),
Allyn and Bacon, 1996.
Hudson, Robert B., ed., The Public Policy and Aging Report, National Academy on Aging, Fall 1997.
Kleyman, Paul, ed., “Driving Ms. and Mr. Aging: A Mobility Agenda,” Aging Today, American Society
on Aging, Sept.-Oct. 2001, 9-12.
Noelker, Linda S., ed.,“Who Will Care for Older People: Workforce Issues in a Changing Society,” Generations,
American Society on Aging, Spring 2001.
Schulz, James H., The Economics of Aging, 5th Edition, Auburn House, 1992.
Thomas, Warren & Associates, The Impacts of Retirement-Age Residents of Arizona, Prepared for Governor’s
Strategic Partnership for Economic Development, 1998.
Trout, John A., ed., Providing Community-Based Services to the Rural Elderly, Sage Publications, 1994.
Vest, Marshall J., The Economic Impact of Senior Income and Spending in Arizona, Prepared for
Governor’s Strategic Partnership for Economic Development, 1999.
Gray Matters: An Economic Analysis of Yavapai County’s Senior Industries 43
Morrison Institute for Public Policy conducts research which informs, advises,
and assists Arizonans. A part of the School of Public Affairs (College of Public
Programs) at Arizona State University, the Institute is a bridge between the
university and the community. Through a variety of publications and forums,
Morrison Institute shares research results with and provides services to public
officials, private sector leaders, and community members who shape public policy.
A nonpartisan advisory board of leading Arizona business people, scholars, public
officials, and public policy experts assists Morrison Institute with its work.
Morrison Institute was established in 1981 through a grant from Marvin and
June Morrison of Gilbert, Arizona and is supported by private and public funds
and contract research.