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The Middle Continues to Fall Away

April 22, 2009

Posted by: Carol

For several years, I've been warning mid-size cities that they have a particularly difficult hurdle to clear. Think about the fate of general purpose midsize retailers, midsize banks, midsize investment firms. Not terribly encouraging, is it? Are midsize cities similiarly theatened?

I was reminded of this today when I read a small item on the front page of USA Today with this headline: "Travel dip slams midsize airports". The article documents drops in domestic service in Cincinnati, Cleveland, San Antonio, Indianapolis, and Hartford from 14-25%.

That doesn't mean service hasn't dropped at major airports, as well. O'Hare traffic will be down 9% in June. And leisure destinations, including Vegas, are expecting double-digit cuts in service this summer. However, USA Today's Marilyn Adams writes that traffic in midsize cities is either disppearing or moving to both smaller and larger destinations.

Consider what will happen to Cleveland if air service seriously dips and people working there in midsize and smaller companies cannot conveniently fly from there. Midsize markets are generally already more expensive than larger cities with more competition. Add the inconvenience of service cuts, and you have a recipe for economic disaster.

Clearly midsize cities will become far less competitive if they lose air service.

What's the solution? It's not yet clear. High(er) speed rail would certainly help if your city happens to be on one of the proposed lines. But that will take awhile. The use of smaller jets is increasing, and that may work. Bigger, regional airports might work, but there's no good domestic model yet for such airports attached to convenient rail from far outlying areas. (Think Cleveland to Chicago.)

But somebody ought to be asking the question and not assume that every airport is going to grow or even survive.