Reason for hope in 'dying' region; Economic development helps restore confidence in an area shaken by layoffs

The pulse of manufacturing in Southside Virginia is not as strong as it once was, but it beats on.

Political and civic leaders recall when Southside and its textile, furniture and tobacco operations were the heart of Virginia's manufacturing economy. Those days are long gone. In recent years, many of Southside's manufacturing operations have taken their jobs and fled to foreign countries where costs are lower. The result is this region has some of the highest unemployment rates in the state and is struggling to revamp its economy.

But two recent economic development announcements - one a significant new employer in Danville and the other a major expansion in Halifax County - show that manufacturing remains a key part of the region's economy.

In mid-October, Gov. Timothy M. Kaine announced that Swedwood North America, a furniture manufacturer and subsidiary of IKEA, will build an 810,000-square-foot manufacturing facility on 209 acres in Cane Creek Centre industrial park east of Danville.

Production is expected to begin at the $85 million plant in September with 300 workers, and over the next 10 years the plant is projected to expand and the number of employees grow to as many as 740 jobs.

At the announcement, Kaine said the project shows there is "much for us to be gained by opening our arms to the world and moving forward with confidence." Local economic officials agree.

In late June, ABB Inc. announced its plans to expand its Halifax facility to make larger transformers. The $25.3 million investment will create 127 jobs.

The existing facility, which manufactures small liquid-cooled transformers for large utility, industrial and government users, is Halifax's largest manufacturing employer and one of its largest industries, with 394 employees and a $20.6 million payroll. The new jobs are expected to pay about $4.9 million in annual wages.

Mike Eades, executive director of the Halifax Industrial Development Authority, takes issue with those who say manufacturing is dying in Southside Virginia: "I think that is a dangerous thing to think."

He noted that the area within a 60-mile radius from Halifax, stretching from Durham, N.C., through Danville to Lynchburg, encompasses about 102,000 manufacturing jobs.

Often, he said, people look at employment as the only measure, but the manufacturing's contribution to Virginia's gross domestic product "has remained fairly stable."

"It doesn't employ as many people, but its output has remained very significant," Eades said.

While manufacturing jobs may be constricting nationally, Danville is still competing for and winning a lot of manufac-

Bunch turing jobs, said Ronald Bunch, the director of Danville's office of economic development.

In the past 30 months, Danville has secured nine new manufacturing operations, representing millions of dollars in investment and thousands of jobs. They include Yorktowne Cabinetry Inc., a manufacturer of semi-custom cabinets, with 540 jobs; Unarco, a manufacturer and repairer of shopping carts, with almost 200 jobs; and Arista Tubes, a manufacturer of extruded plastic tubes, with 145 jobs.

While manufacturing no longer makes up nearly 30 percent of the city's jobs as it once did, local officials continue to recruit manufacturing operations and hope to maintain manufacturing jobs as a key piece of the economy, he said.

It helps that the area grew up around manufacturing and continues to be well suited to industry, featuring a lower tax rate and a work force used to shift work, Bunch said. "You can say we're kind of marketing to a strength," he said.

The operations not only hire production people from the community but office workers as well. There is also the benefit of the multiplier effect, with each manufacturing job adding one to three additional jobs to the economy, Bunch said.

But these are certainly not your father's manufacturing jobs. In the heyday of textiles, it was not uncommon for people to drop out of school to work and remain employed in the same plant for life. Now, the jobs require the ability to work in teams, critical thinking and decision-making abilities, and math and computer skills, Bunch said.

"What you don't see in these companies we are announcing is a lot of unskilled labor," he observed.

Consequently, Bunch said, the key is lifelong learning so local workers can compete with someone in China or India for a job.

"Change is the constant," he said. "It's a global competition."

Staff writer Jamie C. Ruff reports from the Times-Dispatch bureau in Farmville. He covers Southside Virginia. Southside Virginia