THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, March 10, 1996 TAG: 9603090521
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY MYLENE MANGALINDAN, STAFF WRITER
LENGTH: Long : 113 lines
Susceptible to even the smallest federal government squeeze, Hampton Roads learned years ago the meaning of the word ``downsizing.''
Many residents know someone affected by government or corporate cutbacks. Yet it's nearly impossible to determine how many jobs have been gained or lost in the region.
``We don't keep track of jobs by downsizing because there's no way to pull out the jobs that are due to downsizing,'' said William F. Mezger, senior economist at the Virginia Employment Commission who monitors state jobless figures.
The Bureau of Labor Statistics tracks total employment. But 619,200 - the region's total nonfarm employment in January 1996 - is merely an aggregate number that doesn't reveal the number of job gains or losses. Or where they occurred.
Headlines of major layoffs often overshadow job gains. Virginia Power and Newport News Shipbuilding are two examples. Both of these major employers have been cutting their work forces severely. The same is true of other Hampton Roads shipyards.
Meanwhile, Gov. George F. Allen has canvassed the state boasting that 151,800 jobs have been created in the first half of his administration. As evidence of job growth, Allen points to Gateway 2000's computer assembly/distribution plant in Hampton, Motorola Inc.'s announced $3 billion semiconductor factory near Richmond and IBM/Tosiba's $1.2 billion computer-chip facility in Manassas. Such widespread contradictions leave Joe Six-Pack not knowing what to believe.
There's no doubt Hampton Roads has been hit by government and corporate downsizing. That's because the region mirrors fluctuations in the national economy, due to its significant dependence on military and government ties.
Federal contracts have tapered to a drip. Federal employee totals in this area have fallen 6.4 percent, or 3,000 people, since December 1994, according to the Bureau of Labor Statistics.
Per capita income in Hampton Roads, which is 87 percent of the national average, registered zero growth from 1990 to 1993, according to a Hampton Roads Planning District Commission study on incomes.
But the cost of living matches the national average. That means that local residents have comparable expenses to the rest of the country, but smaller paychecks.
Virginians' real income continued to stagnate, and the disparities between rich and poor widened further in recent years, reported a University of Virginia study released Friday. The study analyzed the latest available state income-tax figures.
One of the most frequently cited examples of post-Cold War downsizing is Newport News Shipbuilding. The massive shipyard, like the rest of the shipbuilding industry, has slimmed its work force from a 1985 peak of 30,000 to about 18,700 people today. It plans to employ 16,000 to 16,500 workers at the end of 1996, its CEO announced last year.
These anecdotes about big corporations axing employees, however, shed as much light on the regional job scene as a John Grisham novel does on the legal profession.
``When you talk about downsizing, the big layoffs that are announced by big corporations like AT&T grab headlines,'' said the VEC's Mezger. ``What you don't see in the media is that most of the growth is in new companies and smaller companies. Overall, this is true in the nation as well as Virginia and the Hampton Roads area.''
By most accounts, Hampton Roads is not reeling from downsizing. But the region is far from booming.
The local economy is growing about 2 percent annually. Expanding firms were responsible for most of the growth in 1995, when 5,096 jobs were created, according to a Forward Hampton Roads report.
APAC TeleServices Inc. of Cedar Rapids, Iowa, joined several new companies in locating here in 1995. It operates the package-tracking center for United Parcel Service in Newport News and announced recently it would hire 100 more people than originally planned. The UPS center opened last year with estimates of hiring 800 employees, then 1,100. It will now have 1,200 by April.
Another statistical anomaly that makes job gains and losses hard to tally is that government cutbacks don't always translate into ``lost''jobs.
Many of the functions performed in federal government offices are contracted out to smaller, private firms in Hampton Roads. So the jobs are not disappearing, but merely being transferred to private companies, area economists say.
Many of those jobs are in the so-called ``service sector,'' which are largely regarded as low paying and undesirable. But that may not be true of the service-sector jobs being created in Virginia and locally.
The service and professional trade jobs that the state has added, pay well compared to the dwindling manufacturing jobs in Virginia, concluded a Virginia Employment Commission report entitled ``Good Jobs/Bad Jobs.''
``We generally found that it's pretty true you were losing high-paid jobs in government and manufacturing. At the same time, you were gaining a lot of jobs that were just about as high paying in the professional services,'' Mezger said.
Because ``service-sector jobs'' can be classified in various categories, it's hard to determine an average pay scale for service jobs.
The average weekly wage for all industries is $434. Manufacturing pays $602 on average. Compare that with $393 in services and $471 in finance, insurance and real estate.
Professional services - which includes business or financial services, computer services, specialty retail, engineering or architecture, management consulting, educational and social services - are the fastest growing, Mezger said.
With these facts in mind, Hampton Roads won't see an '80s boom similar to the defense buildup under former President Ronald Reagan, labor economists say. But the job picture isn't as bleak as portrayed by some. ILLUSTRATION: WADE WILSON & JOHN CORBITT/The Virginian-Pilot
Graphic
ROBERT D. VOROS/The Virginian-Pilot
JOBS LOST IN AMERICA
[For complete graphic, please see microfilm]
by CNB