THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Monday, January 22, 1996 TAG: 9601200200
SECTION: BUSINESS WEEKLY PAGE: 9 EDITION: FINAL
SERIES: Forecast 1996
SOURCE: BY LON WAGNER
LENGTH: Long : 110 lines
Hampton Roads new job engine will keep ticking this year.
The region had a relatively good year in 1995, creating jobs at a 4-percent clip during the first half and slowing to 2 percent toward year's end. The same trend will probably hold in '96, said John Whaley, director of economic services at the Hampton Roads Planning District Commission.
``I think 1996 will be not quite as good, but we will be creating jobs and not losing jobs,'' he said.
Hampton Roads enjoyed a spate of new plant announcements in '95 as companies as diverse as Trans World Airlines and Avis car rental said they intended to create hundreds of jobs in the region in '96.
While those jobs should materialize this year, the region will continue to see gradual layoffs among some established employers. For example, the federal government laid off about 3,000 employees in the region in '94 and '95, and will continue to shrink. What's more, the number of people entering the labor force looking for jobs is likely to increase.
The result: Slow but steady job growth, ranging from 1.5 percent to 1.8 percent this year, and a rise in the jobless rate to 5.1 percent from the current 4.9 percent, Whaley projected.
Although employers on the southside and the Peninsula have produced more than 125,000 new jobs in the last decade, pushing civilian employment to record levels month after month, average wages have held steady for most of the last 10 years. Nothing in the cards suggests a change any time soon - unless a wave of new companies opens up paying $800 a week, but no one predicts that will happen.
Last year, the average wage in Tidewater was $445 a week, which has about the same buying power as the $318 weekly average of 1985 when inflation is taken into account.
While pay levels aren't rising significantly, total job numbers are increasing. Whaley's estimate coincides with the projection of 1.5 percent job growth made by the Old Dominion University Forecasting Project.
ODU estimated 698,755 civilians would work on the Peninsula and the southside by March '96, a 1.5 percent increase from '95. Although employment estimates used by various agencies differ widely, depending on the kind of data they use, ODU's estimate is one of the largest in part because it counts the self employed and civilian personnel from outside the region, such as U.S. Department of Defense employees, working temporarily for long periods in Hampton Roads.
Manpower Inc., the country's largest temporary help firm, tracks employers' hiring intentions and predicted a so-so year in Tidewater.
Manpower's survey of Norfolk and Virginia Beach, home to almost half the 1.6 million residents of Hampton Roads, for the first three months of 1996 found 13 percent of the companies planned to add workers this winter, but 7 percent expect to cut their workforce.
``The forecast was brighter one year ago when 27 percent said they would hire,'' Manpower's Deborah Shapiro said.
Last year at this time, only 3 percent of the companies planned to trim their work force. Even three months ago the forecast was more optimistic: 20 percent of the companies planned to hire workers and six percent foresaw staff cuts.
Several factors could be responsible for the dimming employment picture: The once-booming service sector, which created more than 65,000 local jobs in the last decade, particularly in the fields of health and business services, is still expanding, but at a slower pace. And retailers, after creating 38,000 jobs in the region in the last decade, expect sluggish job growth.
Other signals of slowing job growth include a rise in the number of bankruptcies and the number of first-time claims for unemployment.
But other sectors are doing well - or at least better than they had been, Whaley said.
``Tourism continues to grow, the port has done well in '95 and will continue in '96 and the military is no longer the drag it was,'' Whaley said.
In fact, even if the military decreases its Hampton Roads presence in the future, it will be offset by the 9,200 personnel the region gained during the 1993 shifts of the base closing commission and the 5,000 the region picked up last year, Whaley said.
Another recent drag on the local economy is becoming less of a problem - commercial office space.
The economy's improvement since the '91 recession has slowly filled the surplus office space left from the '80s building boom. The dwindling volume of commercial office space, particularly in downtown Norfolk, is expected to eventually trigger a new round of construction.
``There is not a lot of commercial construction going on today,'' Whaley said, ``it's just that the numbers, instead of going south, are starting to go north. At some point, you'll need to build more.'' ILLUSTRATION: Color photo by Christopher Reddick\The Virginian-Pilot
John Whaley: I Think 1996 will not be quite as good, but we will be
creating jobs and not losing jobs"
Graphic by the Virginian/Pilot
Employment by field
For copy of graphic, see microfilm
[Side Bar]
Major Expansions announced in 1995
Avis car rental
Canon technical
Gateway 2000
Lillian Vernon
MCI Communications
Newport News Inc., customer service center.
Trans World Airways
United Parcel Service
ValuJet Airlines
KEYWORDS: EMPLOYMENT STATISTICS JOBS HAMPTON ROADS by CNB