Dec. 12--South Florida's hotel occupancy levels inched past the state and national averages in early December, but economic development officials say that's no cause for unbridled optimism. 

On the eve of the tourism high season, room rates and occupancy levels are still well below a year ago. 

Meanwhile, other industries, such as international trade, which have traditionally taken some of the sting out of tourism downturns, are entering pronounced slumps as major partners in the Caribbean and Latin America witness startling slowdowns. 

"We're no longer in a free fall, but we will have sluggish conditions in '02," local economist Tony Villamil told the annual economic outlook conference of the Beacon Council, Miami-Dade's development agency. "The events of Sept. 11 were like a sucker punch to our economy." 

Broward faces a similar situation, said Nicki Grossman, president of the Greater Fort Lauderdale Convention and Visitors Bureau. Doing better than the rest of the country is little solace at a time when everyone is doing poorly, she said. "Right now it's very hard to celebrate that we're not down the way the other destinations are," she said. "We're desperately trying to rehabilitate the business." 

Indeed, the signs of the slowdown are multiplying across the region. Despite strength in some key industries like construction, unemployment claims in Miami-Dade were up 140 percent in October compared to the same month last year, according to the Beacon Council, and in November they were 50 percent higher than a year earlier. 

Retail sales, which had been running about 5 percent above last year's levels, now will likely wind up flat on the year. 

Meanwhile, hotels across Florida were 48.5 percent full last week compared to 50.5 percent nationwide. Numbers were sunnier in South Florida: occupancy clocked in at 51.4 percent for Miami-Dade, 48.6 percent for the Florida Keys, and 58.6 percent for Broward. 

"Things are getting better -- very slowly," William Talbert, president of the Greater Miami Convention & Visitors Bureau, said at the Beacon Council breakfast, held at the Hotel Inter-Continental. "We are cautiously optimistic, but things aren't going to be the same." 

For instance, rising occupancy is being generated in part by cutting rates, producing less economic benefit for hotel owners. 

"We're seeing discounts of 15 percent on the weekends and 50 percent during the week," said Chase Burritt, an analyst with Ernst & Young. 

In Miami-Dade, daily revenues generated per room averaged $63.30 for the week ending Dec.1, off nearly 25 percent from last year. It was off 23.6 percent in the Keys and 13.1 percent in Fort Lauderdale. 

"That's where we're seeing the big decline," said Ben Mollere, vice president of sales for the Biltmore Hotel in Coral Gables, where rooms average $38 less per night compared to last year. "We're going to finish this month at 58 percent (full). Last year we were at 60 percent, but at a much higher rate." 

Talbert predicted visitor counts will be off between 12 and 15 percent in the first quarter of 2002. 

Tourism isn't the only industry feeling the economic pinch. Merchandise trade is also declining, said Villamil, the economist, and he isn't yet certain when a turnaround might occur. 

The problem is that South Florida's largest trade partners are in Latin America, which is deeply troubled. And recovery there is unlikely until the U.S. economic recovery -- currently projected not to begin before the middle of next year. 

"Recessionary conditions continue in South America," he said. "That's unlikely to pick up significantly in '02." 

South Florida faces some unique challenges in mounting a recovery. For one thing, marketing efforts to get tourists to drive to Florida will have less impact in South Florida because of the importance of international arrivals here. 

"Last time we looked, nobody was driving here from Latin America or Europe," said Frank Nero, president of the Beacon Council. 

Also, in the past a national recession often resulted in unemployed workers migrating to Florida in search of work -- a trend that could further boost the jobless rate here. 

So while most experts believe the recession will be over in the first half of next year, the vitality of the recovery is still subject to speculation. 

"The big question mark for all of us is whether this will be a strong pickup," said Villamil. 

By Cara Buckley and Gregg Fields 

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(c) 2001, The Miami Herald. Distributed by Knight Ridder/Tribune Business News.