Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, March 8, 1990 TAG: 9003081794
SECTION: VIRGINIA PAGE: B1 EDITION: NEW RIVER VALLEY
SOURCE: MADELYN ROSENBERG NEW RIVER VALLEY BUREAU
DATELINE: CHRISTIANSBURG LENGTH: Medium
"This shows me, and I hope the rest of us, that we're all in this together," Thomas G. Johnson, a professor in agricultural economics and author of the study, told about 20 representatives of New River Valley governments. "It's not Pulaski's problem; it's the whole valley's problem."
Johnson, who was asked to do the study after Pulaski County's third-largest employer announced it would be shutting its doors over the next year, said the 950 AT&T employees whose jobs will be lost represent all New River localities. And, though the brunt of the impact would be in Pulaski, the estimated loss of 550 residents, 1,560 jobs and more than $1 million a year in fiscal services resulting from the closure would touch each locality as well.
"The information is valuable because it gives us a better idea of what we're up against," Johnson said. "By just keeping track of what's going on, we can help other employers."
The study, which is based on two economic models, estimates that valley-wide income will be reduced by $37 million, retail sales will drop about $25 million, real property will fall almost $40 million in value and personal property will be almost $17 million less than if the plant continued to operate.
The decrease in jobs will have the greatest impact on Pulaski County, where 450 of the workers reside, Johnson said. He estimated that 1,475 jobs would be lost in the county, although the workers could be from other locations. He arrived at the figure by calculating that for each 100 AT&T jobs, 64 other jobs are created.
Pulaski County also will suffer more than half of the loss in fiscal resources, such as tax revenues and cost economies, Johnson said.
He said estimated losses of $520,000 in Pulaski County, $330,000 in Montgomery County, $50,000 in Radford, $60,000 in Wythe County, $40,000 in Giles County and $28,000 in Floyd County for each year that the plant remains closed.
Unemployment rates would rise by 2.2 percent in Pulaski County, 1.9 percent in Radford, and 0.3 percent or less in the remaining localities.
"The variable is how many people leave when they lose their jobs," Johnson said. "If fewer people leave, it could be even higher."
Population is expected to decline by 250 people in Pulaski County, according to the study. It should go down by 120 people in Montgomery, 144 in Radford and 41 in Wythe, Giles and Floyd counties combined.
"Other changes are perhaps just as big," Johnson said, referring to recent layoffs on smaller scales by New River Valley businesses. Other plants have announced cutbacks through attrition, which also can hurt the economy.
"When firms announce that they are declining in size through attrition, somehow we feel more comfortable," Johnson said. "But in the long run, it's just as harmful."
Overall, Johnson said, the economy in the New River Valley "is not all that bad, despite the recent setbacks."
He said the AT&T building should be attractive to new industry, as will the valley's work force.
Peter Huber, assistant county administrator for Pulaski, said Wednesday night that he was surprised to see how far-reaching the effects of the closure could be.
"I knew the impact would be fairly significant in Pulaski," he said. "But I didn't know the kind of impact it would have on the entire New River Valley."
by CNB