Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, January 24, 1993 TAG: 9301260401
SECTION: NEW RIVER VALLEY ECONOMY PAGE: 12 EDITION: NEW RIVER VALLEY
SOURCE: ROBERT FREIS STAFF WRITER
DATELINE: LENGTH: Medium
EDUCATION KEEPING VALLEY VIBRANT
Amid ebbing economic tides in the New River Valley, educational institutions are a bulwark of stability.The region's traditional occupational leader - manufacturing - is suffering a reduction in force due to shifts in domestic and global economies.
However, education as an industry will remain a strong, supportive influence on the area's economy, experts say. Payrolls now are about $275 million a year.
They predict education will expand slowly as a source of employment, even as other industries subside.
"Manufacturing seems to be on a decline," said William Metzger, an economist with the Virginia Employment Commission. "As time goes on, the educational institutions will probably become a bigger slice of the pie."
About one New River Valley employee in six works in education, either for a state, local or private institution. In numerical terms, education ranks second to manufacturing.
Only in one other area of Virginia (Charlottesville and Albemarle County) does so high a proportion of local employment depend upon education.
Virginia Tech is by far the area's largest employer, with 5,800 full-time employees. Radford University employs 1,600, New River Community College employs 460 and public school systems employ about 2,300, led by Montgomery County's 1,400.
These institutions haven't been immune from cutbacks.
Tech, in particular, has been forced by tight state budgets to eliminate several hundred jobs. Yet Radford University has gained jobs, with the likelihood of additional growth.
The area's public school divisions also are growing - even if much of the money to fund that growth comes from local taxes.
There are several factors that make education a valuable economic presence.
Schools and universities tend to be labor-intensive, with many employees and a large percentage of expenditures absorbed by salaries and benefits, said Tom Johnson, a Virginia Tech economist.
Tech's annual payroll is around $240 million. Montgomery County schools' payroll is $24 million. And New River Community College's payroll is $7.7 million.
Those dollars have a significant economic influence, creating and sustaining other businesses that serve school employees.
"There's quite a strong ripple effect that tends to circulate in the local economy," Johnson said.
Radford University estimates that it contributes $89 million annually to the city of Radford's economy and $163.6 million to the New River Valley's economy.
Those dollars are especially important to retail and service industries and to the real estate market, Johnson said.
Students attending the area's four-year colleges also bring revenue into the community from other parts of the state, nation and world.
Student-generated revenue became a controversial topic recently when Radford University announced it may introduce a debit card system allowing students to charge purchases of food, books and clothing on campus against their university accounts.
Merchants in downtown Radford, who benefit from student spending, were alarmed that the new card would divert revenue from their cash registers and keep the dollars on campus.
City Council has asked Radford University to work with merchants to develop a mutually satisfactory system.
Other favorable spinoffs involve technical, research and consulting businesses, which tend to be attracted by the presence of higher education institutions, Johnson said.
Virginia Tech's emphasis on energy and fiber-optic research has spawned technical businesses in Blacksburg, he said.
And the presence of educational institutions also is beneficial to the New River Valley's quality of life.
"It brings more culturally and socially diverse offerings to the area," Johnson said.
"In the future, people will have the opportunity to make greater choices about where they live. Education is a positive for economic growth."
Virginia Tech, Radford and New River Community College make the New River Valley more appealing to migrants or retirees than other nearby parts of Virginia that lack such a presence, he said.
Finally, Johnson said education is a growth industry with a guaranteed demand.
"All you have to do is look at the demographic trends. More adults are coming back to school, and there are more children to educate. So more resources will be put into education."
The conclusion is that the New River Valley won't have to fear its educational institutions will wind up like some of its other industries - vacant behind a chain-link fence.