Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, January 28, 1992 TAG: 9201280166
SECTION: VIRGINIA PAGE: B-1 EDITION: METRO
SOURCE: MONICA DAVEY STAFF WRITER
DATELINE: LYNCHBURG LENGTH: Long
LAYOFF ANNOUNCEMENTS TRIGGER GLOOM AND FEAR IN LYNCHBURG
From behind the cash register of Thomas Terrace Exxon, Terry Severson has seen a lot of gloomy faces in the past week.Because it is just down the road from Babcock & Wilcox's Naval Nuclear Fuel Division, Severson's service station draws bunches of B&W workers every day.
Last Tuesday, the company announced plans to eliminate 400 positions from its work force of 2,200.
The announcement from one of the area's largest, most established companies came just a week after steel fabricator Montague-Betts Co. announced that it will close two plants, zapping 300 people out of work.
The news has left people in Lynchburg and Central Virginia wondering what 700 lost jobs will mean and what's next.
"The mood is bad," Severson said of his customers who stop in on their way to and from work at B&W.
Already, Severson says, he can feel effects of the layoffs.
Gasoline sales have not dropped, but repair work at Severson's shop has decreased since layoff rumors started, he said.
"People who used to come in here, leave their car and say, `Do whatever you have to do,' aren't doing that now," Severson said. "And people who used to drive three cars are driving two."
Like other workers, B&W employee Kenley Gaulden does not know whether he will be among the 250 hourly workers or 150 salaried workers to lose their jobs.
Gaulden, whose wife gave birth to their second child Jan. 17, is worried he'll be cut from B&W's 150-person security force, where he has worked for more than 12 years.
He already has applied for part-time jobs, just in case.
"I've driven a truck before," said Gaulden, who had just finished a shift at the plant last week and stopped off at Thomas Terrace Market.
"I really don't know where it's going to end; I really don't," Gaulden said of cuts at his plant and at Montague-Betts.
"From hearing from people who lived through the Depression, it seems like we're well on the road to another."
Butch Barley works at C&P Telephone, but believes his business could be affected.
"When unemployment for these people runs out, they'll stop buying things and start giving up things, like telephone service," said Barley, who was making repairs to a phone line in the Thomas Terrace Market.
Despite 20 years at C&P, Barley said, "I don't feel so safe."
That feeling, according to several Lynchburg-area leaders and economists, is part of the problem.
"I think it's important to keep in mind that the closure at Montague-Betts and the layoffs at B&W were totally unrelated," said Joseph Turek, director of Lynchburg College's business and economic research center.
Montague-Betts' decision to close two plants was "clearly recession-related," Turek said.
The layoffs at Babcock & Wilcox, whose defense-related contracts make up the majority of its business, had more to do with a nationwide drop in defense spending, he said.
"The really dangerous thing to think is that this is the one-two punch," Turek said. "People go `One, two . . . Is this the start of something?' "
Such "negative consumer psychology" just makes the economy get worse, he said.
Businessman Buzzy Coleman agrees.
Coleman, of Coleman-Adams Construction Inc., admits that getting construction contracts is as "tight" as it's been since he went into business in 1971.
His work force typically ranges from 150 to 250 people. At the moment, it's just below 150.
Still, he said, "If we'd all cheer up, I think it'll get better.
"I'm sick of reading bad stuff" in the newspapers, Coleman added. "We need to get off the deadbeat talk."
Despite the bad vibes, the Lynchburg area actually has been in remarkably good shape until the past few weeks, Turek maintains.
Virginia Employment Commission figures - which include Lynchburg and Bedford and the counties of Campbell, Amherst, Bedford and Appomattox - indicate that more people were working this fall than were when the national recession began.
"That's the irony," Turek said. "People have been hearing about the recession in the national news for a year and a half, but actually, until recently, Lynchburg had done very, very well."
About 1,400 more Central Virginia residents had jobs in October 1991 than in July 1990, Turek said. Officials said they did not know whether that increase represented growth in manufacturing or in the lower-paying service sector.
Most of those jobs were in the suburban areas outside Lynchburg, according to Lynchburg Economic Development Director Lee Cobb. Bedford County's Forest area, in particular, grew quickly in the past year or so, Cobb said.
As for the future, no one seems certain.
"It depends on who you talk to," said Jeff Taylor, program manager for Region 2000, an organization which promotes economic development in Central Virginia.
The good news, said Taylor, is that the 700 announced layoffs will not happen tomorrow.
Montague-Betts' plants will close in six months, Taylor said. And B&W's layoffs will happen over the next 15.
"That will give some time to breathe," Taylor said. "It'll give people time to look for other work."
Taylor realizes that organizations like his will not be able to lure new companies to the area to employ 700 people in a matter of days or months.
"We don't have any 30-minute . . . resolutions. You've got to just keep that slow steady growth that we've had in the past.
"We are bleeding a bit right now," Taylor added. "But we're not hemorrhaging."