|
 Economic recovery has spread wide, with 34 states reaching new
employment highs this year and thousands of counties now close to
unemployment rates of the boom years earlier this decade, according
to a Reuters analysis of federal data.
The U.S. Federal Reserve has played a central role in engineering
that recovery and has become progressively less worried about the
nation's job market, interpreting the slowdown in payrolls' growth
as a sign of near-full employment.
But Russell's abandoned headquarters in Alexander City stands as a
reminder of forces the Fed's massive easy money campaign is
ill-equipped to confront. What is needed now is more akin to
hand-to-hand combat, state and local officials say.
What Alexander City could use, for example, is a $4 million rail
spur to connect its industrial parks with the nearby rail line, or
more state help in paying the grading and utility connection costs
to entice would-be investors, says former mayor Don McClellan.
Or perhaps, he suggests, programs to boost the community college's
retraining of mid-career workers among thousands who lost jobs as
Russell's operations wound down for good after a 2006 takeover by
Berkshire Hathaway.
"It is much harder to recruit here," says McClellan, now regional
development chief.
"When the state lands white collar jobs, it is in the metro areas."
As 2016 presidential candidates from billionaire Donald Trump to
Bernie Sanders square off over the economy, the debate is not just
about the number of jobs. The contenders and Fed officials alike
also fret about sluggish wage growth, low productivity and the
quality of positions being created.
Yet Fed officials, who discuss whether to raise rates for the first
time in a decade, recognize that for all their power they may lack
the tools to address such concerns.
"An interest rate hike is not going to affect job training in Macon
County, Georgia," said David Wiczer, an economist at the St. Louis
Fed who studies labor market issues.
HEALING SCARS AND DARK SPOTS
U.S. state and county statistics show the spread of recovery,
allaying some of the fears about permanent scars from the crisis.
But they also show some persistent spots of high unemployment.
Among more than 800 large counties surveyed annually by the U.S.
Census, nearly 700 had by last year virtually returned to 2007
unemployment rates - a group that has most likely grown given a
steady climb in payrolls this year. (Graphic: http://tmsnrt.rs/1Wm3hcB)
Some states, however, continue to struggle, whether with legacies of
uneven development and racial segregation, or longer-term changes in
the U.S. and global economies. Alabama and nine other states ,
accounting for just over 16 percent of national economic output both
have yet to return to pre-crisis employment levels and have
above-average unemployment rates.(Graphic: http://tmsnrt.rs/1Wm32y7)
In West Virginia, coal mine closures have weighed on employment for
more than three decades; in Illinois and Pennsylvania the decline of
heavy manufacturing has left its mark. In Alabama, the loss of
textile jobs has swelled unemployment rolls, while jobless rates in
a dozen or so heavily African American "Black Belt" counties remain
in the teens.
As of September, the state had about 57,000 fewer jobs than in 2007,
a 3 percent shortfall. Its labor force is down too and its adult
population growing slower than the country as a whole.
[to top of second column] |
Alexander City is a case in point.
That this town of less than 15,000 ended up with an 85,000 square
foot (7,900 square meter)Fortune 500 headquarters, with an atrium
waterfall and apartments for visiting executives, was an accident of
history.
What later became Russell Athletics began as a small sewing
operation that rose to national prominence making team-branded
sports jerseys. The company began shifting jobs overseas in the late
1990s and closed its headquarters in 2010, leaving only a token
presence.
"When Russell started downsizing. ..we did not have big brother to
take care of us anymore," says McClellan.
To fill that void one needs well-targeted investments that would not
just create jobs in the near-term, but improve productivity in the
long run, local officials say.
Yet, unlike the Fed, which used its virtually unlimited firepower to
churn out trillions of dollars in monetary stimulus, local, state
and federal governments lack such leeway.
Political battles over the nation's debt ceiling hamper federal
spending while local authorities face hard budget constraints.
A budget shortfall made Alabama dip into its education fund this
year to pay other expenses, while financial summaries show the
state's $1.3 billion transportation budget consumed mostly with
maintaining existing roads and bridges.
That leaves small-bore initiatives, such as $11.5 million in
training, small business support, investment incentives and other
projects announced last month for the "Black Belt" counties.
Further to the north, in Alexander City, McClellan said the region
was expanding community college programs to retrain older workers,
and has recruited auto parts suppliers for the Hyundai plant in
Montgomery and a Kia Motors Corp. <000270.KS> factory just across
the Georgia state line.
Spencer Lucker, spokesman for the Delta Regional Authority, a small
federal rural development agency for the Mississippi Delta region,
says Alabama's problems are typical - with pockets of high
unemployment where most new jobs are created by small business
start-ups.
“It is a general pattern across most of our states,” Lucker says.
“What we have been focused on, is building out pockets of
entrepreneurship (and) it is a slow process.”
(Reporting by Howard Schneider; Editing by David Chance and Tomasz
Janowski)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed. |
