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Job Market Chaos for Tri-Cities November 2009-14

compiled by Lewis Loflin

Update for 2015 quoting Dr. Steb Hipple Tri-Cities Labor Market Report East Tennessee State University - Third Quarter 2014 where job losses have continued for eight consecutive quarters:

Existing labor market trends dominated the Tri-Cities Consolidated Statistical Area (CSA) in the third quarter. Compared to the same period in 2013, regional employment was lower by 1.7% to 218,244, while unemployment fell 10.3% to 16,664 as discouraged job seekers continued to leave the regional labor force. The summer unemployment rate for the metro area was 7.1% (compared to 7.7% a year earlier). With the labor force shrinking by 2.4%, the falling jobless rate is a sign of labor market weakness.

During the July to September period, employment was lower in all three cities - falling 2.2% in Kingsport, 2.0% in Johnson City, and 1.2% in Bristol. Matching the regional pattern, large numbers of unemployed workers are exiting the labor market in each city. This has lowered the jobless counts, contracted the labor force, and reduced the unemployment rates. The percent of workers unemployed was 7.0% in Kingsport, 7.1% in Johnson City, and 7.1% in Bristol. As in the metro area, the lower rates in each city reflect labor market weakness.

Alcoa Slams the Doors in Lebanon, VA, Cans last 76 Workers. 2010 was supposed to be great year for Alcoa in Lebanon, but the troubled manufacturer has called it quits. Years of broken promises and never producing the jobs promised have left the public holding the bag again. Alcoa has received a lot of corporate welfare proving again why these funds are wasted.

In fact the efforts of government economic development are so dismal one official finally came out and stated they will only pursue government jobs. Their efforts will be aimed at government jobs and government contractors, not private sector jobs.

Today in the Coalfield Counties of Southwest Virginia as much as one-third of the workforce is employed by government. The private sector consists of poverty wage service jobs related to the often subsidized tourism/retirement industries. In fact one Bristol, Virginia leader claimed welfare benefits the region because it brings in income.

Alcoa blames the "market" for its problems and they are right. But they also should never have located in Lebanon to begin with. While not pointing a finger in particular at Alcoa, many companies locate here to simply pay below market wages and cash in on generous government subsidies. This is made even worse because government hacks trying to justify their huge paychecks (the only real jobs they create are their own) cut deals with almost anybody on the worse possible terms.

There are no standards for success nor are there any enforcement mechanisms when the deal goes bad. As state Senator Terry Kilgore told me they were supposed to adopt an enforcement mechanism in 2008. He is on the infamous Virginia Tobacco Commission that instead of serving average residents has been reduced to a political slush fund for their friends. Posted November 1, 2009.

Government waste in Tri-Cities

The so-called Virginia Tobacco Indemnification and Community Revitalization Commission just awarded another $25 million for 20 projects across Southwest Virginia. Executive Director Neal Noyes claims, "We see this as a game changer." But that was claimed in the previous eight years when they porked-out about $750 million in grants that have so far produced nothing. They had a unanimous vote at their meeting in Wytheville October 29.

This latest round of pork includes another $3.5 million for Bristol Virginia Utilities to overbuild more private sector fiber-optic lines. These have been already available for years and have produced mainly call centers that come and go like clockwork. This foray of a public utility into the private-sector telecom industry has yet to produce a single verifiable job and has left BVU customers straddled with $49 million in debt. This was even after $10-$15 million in economic development grants they have already spent. They also got $5.5 million in 2008.

The Bristol-based Birthplace of Country Music Alliance received $250,000 to fix up an old garage as a museum. Other recommended pork projects as of September:

#1874 Town of Pennington Gap Lee Theater / Learning Center Renovation $232,815
#1911 Southwest Virginia Community Foundation, Inc. Clinch Mountain Performing Arts Center $500,000
#1890 Wise County IDA Wise Inn Restoration and Redevelopment $250,000

The total cost of the useless Wise Inn project:

Total project cost is $ 8,100,000. Other funds include: $700,000 - DHCD for renovations and construction (letter of intent received); $277,574 - Appalachian Regional Commission (ARC) for renovations and construction (awarded); $1,180,000 - Wise County IDA for acquisition and parking structure construction (approved and available as needed); $250,000 - Town of Wise for renovation and construction (committed and available as needed); $1,200,000 - VA Coalfield EDA for renovation and construction (approved); $3,392,426 - first mortgage debt and historic tax credits for renovation and construction (to be arranged).

Government waste in Tri-Cities

Typical is this:

IDA of Dickenson County Dickenson Center for Education and Research (#1878) $125,000 requested Funds are requested to build out unfinished space of approximately 2,800 square feet in the Dickenson Center for Education and Research. The space is partially complete from previous construction and lacks finished drywall, painting, ceiling, electrical, plumbing, etc. to become training space to serve the needs of local employers. There is a need for space to house groups of 40 or more and the Center does not currently have finished space to accommodate these requests.

There are no matching funds in this phase of work, but substantial matching funds in previous construction phases that enabled the Center to open in the past year. The Center's staff has been tracking the use of existing smaller classrooms and demand for a larger meeting space. This improvement would provide a multi-function location for training large numbers of employees from private employers located in or near the County Technology park, such as EQT Corp (natural gas), coal mining companies and the SI call center, as well as regional public employers including the school system and prisons.

Let's note the 100 jobs they "created" at this S.I. (a government contractor) call center has already cost taxpayers $10 million at a cost of $100,000 per job. Why are they providing more corporate welfare to existing energy companies when the idea of these grants was to find alternative employment to these very industries? They make millions and still get corporate welfare?

Total project cost is $7,615,830. Other funds include: $200,000 - USDA Rural Development for the industrial room construction (completed); $25,000 - USDA Community Facilities Grant to purchase furnishings (ongoing) ; $85,000 - Congressional Directed Grant to purchase technology equipment (awarded); $1,100,000 - Dickenson County Local Government for building and land grant match (completed); $96,000 - Appalachian Regional Commission to purchase technology equipment (completed); $4,000,000 - Virginia Coalfield Economic Development Authority for construction and furnishings (completed); $200,000 - TICRC for construction and furnishings (completed).

September 29, 2009 Bosch Braking System will can 140 at its Johnson City facility by summer 2010. This was no surprise according to local reports. This is just another in an endless stream of losses in manufacturing that have ripped the region.

Saturn's closing will have a profound ripple effect across the state of Tennessee. Saturn is headquartered in Spring Hill, Tennessee. Starting as a separate company 19 years ago, its 3000 employees losing their jobs will devastate the community about 35 miles south of Nashville. The lost of business to suppliers will be equally devastating.

GM sold less than 200,000 for 2008. Besides dumping the Saturn brand GM is ending its Pontiac, Saab and Hummer lines. GM put three facilities including the Spring Hill plant on standby, closed a dozen others, and will close about 2000 dealerships. According to some reports 350 Saturn dealerships will close and 13,000 jobs will be lost.

Existing Saturns will be serviced I assume by surviving dealers such as "Wild" Bill Gatton Acura Mazda Saturn 2909 North Roan Street, Johnson City, the region's largest dealer. They also have a large dealership on the Volunteer Parkway, Bristol Tennessee next to the new Wal-Mart. His commercials in the past have included silly cowboy hats, live pigs, and other Hillbilly nonsense. Mr. Gatton is no hick, but a sharp and successful businessman.

It isn't just auto industry job losses hammering Tennessee, Southwest Virginia, and Tri-Cities. Traco (www.traco.com) in Johnson City is slamming the doors. Back in May local economic developers finally thought they had one when Traco hired 70 employees after slamming the doors in Georgia. They have been in Johnson City for ten years and the Johnson City Press reports they will fire 200 workers.

So where has "NETWORKS" been while all of this has been going on? Boss Richard Venable, once head of the Sullivan County Commission, claims to have another fix just down the road so be patient. Boss Venable it will be recalled along with other local politicians were operating a religious crusade out of public office to avoid dealing with the thousands of job losses occurring at Eastman Chemical and other manufacturers in 2000.

This was when Sullivan County put emergency services on alert for the "rapture" they believed was going to happen with Y2K. Even Randy Weaver who got his wife and son killed at Ruby Ridge by the Feds rolled into Sullivan County claiming the end was near. The thousands of citizens vanishing into thin air or the UN takeover of America to fail to occur.

"NETWORKS" is another pseudo-government entity funded by Sullivan County, Bluff City, Bristol, Tenn., and Kingsport taxpayers. Venable said earlier in the year all the job losses were "right sizing" and would make Sullivan County more competitive in local television. He sees this as a good thing it seems. Boss Venable now claims (BHC September 25, 2009) some "start-up manufacturing company" is interested in locating here. He has been overseeing "right sizing" for years.

Update 2015: the new company never materialized.

I guess it's going to be another Traco that comes and gets the corporate welfare then pulls out. Ten years from now government hacks will claim they created 70 new jobs at Traco, not that they lost 200 instead. This is why the actual number of real jobs seldom increases here at all. In the case of the new company he refuses to say who it is. I guess it's to protect this company when it shafts its workers and relocates. The only real jobs they seem to create are there own.

This page posted 22 November 2009

Update for 2015 quoting Dr. Steb Hipple Tri-Cities Labor Market Report East Tennessee State University - Third Quarter 2014 where job losses have continued for eight consecutive quarters:

Existing labor market trends dominated the Tri-Cities Consolidated Statistical Area (CSA) in the third quarter. Compared to the same period in 2013, regional employment was lower by 1.7% to 218,244, while unemployment fell 10.3% to 16,664 as discouraged job seekers continued to leave the regional labor force. The summer unemployment rate for the metro area was 7.1% (compared to 7.7% a year earlier). With the labor force shrinking by 2.4%, the falling jobless rate is a sign of labor market weakness.

During the July to September period, employment was lower in all three cities - falling 2.2% in Kingsport, 2.0% in Johnson City, and 1.2% in Bristol. Matching the regional pattern, large numbers of unemployed workers are exiting the labor market in each city. This has lowered the jobless counts, contracted the labor force, and reduced the unemployment rates. The percent of workers unemployed was 7.0% in Kingsport, 7.1% in Johnson City, and 7.1% in Bristol. As in the metro area, the lower rates in each city reflect labor market weakness.