THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Monday, May 8, 1995 TAG: 9505060230
SECTION: BUSINESS WEEKLY PAGE: 04 EDITION: FINAL
TYPE: Opinion
SOURCE: Ted Evanoff
LENGTH: Medium: 79 lines
If you had only recently walked along Atlantic Street after a long absence you might easily stare in surprise at downtown Norfolk. It's as if a city of new culture and commerce had been built.
The old waterfront on the Elizabeth River gave way to the Nauticus museum, Waterside festival marketplace and Harbor Park baseball stadium. Nearby stand the Waterside Mariott Hotel, the Omni International Hotel and several new office buildings.
Rebuilt in the last decade, the riverfront looks handsome. All it lacks to resemble a true urban hub is a bustling district of shops and stores. And last week city officials struck retail gold.
``This is the largest single economic development stroke in the city's history,'' Norfolk Mayor Paul Fraim said.
The mayor was enthused about the proposed MacArthur Center mall. Taubman Corp., a prominent developer near Detroit, had just signed on. Taubman's financial and marketing clout can turn 17 downtown acres into the upscale shopping center long sought by city officials.
Without a doubt the three-deck mall would be another jewel for Norfolk. The mall would expand the tax base, provide 3,000 jobs and draw more dollars downtown.
What the mall might also do is help raise Tidewater's wage base. If it can do so, it will be well worth the city's $100 million in loans and infrastructure improvements for the project.
Between the subject of malls and wages is a wide gulf. But consider the issue of wages from the viewpoint of Jim Waldman. He runs a small trade school in Virginia Beach. He describes his students as earnest and hard-working. Many are 25 or older.
They study for 16 months and graduate from Computer Dynamics Institute with certificates that tell employers they can fix computers, transcribe medical records or handle basic nursing or dental chores. They are the skilled workers of the new service economy.
In the last 10 years, businesses in Tidewater's service sector surpassed the government to become the area's largest civilian employer.
Last year, service businesses employed almost 170,000 people in Tidewater. That's 74 percent more service workers than in '84. It's remarkable considering government employment, not counting military personnel, rose only 7 percent to about 126,000 in that period, while manufacturing held even at about 67,000 jobs, and construction employment rose slightly to about 35,000.
There's another remarkable fact about the service sector. When the new graduates leave Waldman's school, many also leave Hampton Roads.
``We have them go all over the country,'' Waldman said. ``They want to stay here but they're unable to because of the wage rates. You take the same person and they can go to Raleigh and make another $4 an hour.''
You could write a book about why the region's wages are low. There's the abundant number of educated military spouses and veterans willing to accept lower pay.
And there's the heavy concentration of service and retail companies. Their wages generally are modest to begin with. Last September, the average retail employee in Tidewater earned $247 a week, below the average of $444 a week for all industries.
What's telling is that the average retail wage here was almost 18 percent less than the $291 a week earned by the typical retail worker in Richmond, Virginia's Employment Commission reports.
``The low wages are a mixed blessing. Companies come into the area for the wages, and that's good because it provides jobs,'' Waldman said, referring to the new service centers of companies including American Funds Group and USAA insurance. ``But if you want to build the economy up you need higher wages.''
MacArthur Center could help. Site relocation firms regard Hampton Roads as a good place to put a service office, the kind of operation that pays relatively low wages to people handling computer files.
Headquarters and prominent regional offices with a salaried staff are more likely to go to Atlanta, Charlotte, Orlando or Raleigh.
What can help Hampton Roads reach a higher level is an urban hub that serves as a cultural and social downtown for Tidewater. MacArthur Center can help foster urban sophistication on the old waterfront of the Elizabeth. by CNB