Small towns take big hits from closings of factories

TRENTON, Ga., Oct 11, 2008 (Chattanooga Times/Free Press - McClatchy-Tribune Information Services via COMTEX) -- VLKAY | Quote | Chart | News | PowerRating -- After 37 years of work at the Trenton Spinning Mills, Mildred Grider learned this week that her career with Dade County's biggest employer soon will end.

Like most of the 440 plant employees to be laid off, Mrs. Grider is trying to find a replacement job in what is the worst job market in at least 15 years.

"I raised my children off of this plant, but I need to find another job and I'm afraid that is going to be very hard now, especially in this area," the 58-year-old woman said.

For small towns such as Trenton, the current economic downturn could be especially hard. On the same day that Dade County learned it soon will lose its biggest private employer, officials in Sequatchie County in Tennessee were told that what was once the biggest manufacturer in Dunlap soon will shut down. Tecumseh Power Co. plans to lay off the last 180 workers at a plant that once had more than 600 employees.

"It's a real blow, not only to the workers directly affected by this closing but for the entire community that relies upon the jobs and income it produces," said Jeff Land, a comptroller for Citizens Tri-County Bank in Dunlap and president of the Sequatchie County Chamber of Commerce.

Outside of the urban counties where most hospitals, universities, shopping centers and service industries are located, small towns often are disproportionately dependent upon factories and mills.

In the past decade, as manufacturing has dropped by more than 26 percent across Tennessee, some of the hardest-hit communities from the factory cutbacks have been in small towns and rural counties, according to studies by the Center for Business and Economic Research at the University of Tennessee.

"That's why we continue to see rural counties have the highest unemployment rates in our state," said Dr. Matt Murray, an associate economics professor at the University of Tennessee.

In August, unemployment in Dade and Sequatchie counties was still below the U.S. average, although the jobless rate in both counties has risen some in the past year as the U.S. rate as increased. The two counties have maintained relatively low jobless rates, in part, because many of their residents work in nearby Chattanooga.

vying for vw suppliers

Leaders in both counties on Friday said they hope to capitalize on their neighboring urban county of Hamilton, especially to recruit suppliers to the Volkswagen assembly plant to be built by late 2010 in Chattanooga's Enterprise South industrial park.

"The loss of the mill is a big blow, but we hope to turn this negative into a positive, if we can," said Allan Ward, a Rising Fawn, Ga., business owner and chairman of the Dade County Chamber of Commerce.

In Sequatchie County, Mr. Land said the county already is considering trying to buy the Tecumseh plant after it is closed to help market the $6.1 million facility to another manufacturer.

In Dade County, Executive Ben Brandon said local leaders have begun to talk with the owner of Trenton Spinning Mills -- Shaw Industries -- about making the 187,648-square-foot plant available to offer to prospective suppliers for the new VW plant once the plant is closed in December.

But that may not offer any short term relief for the families and businesses nearby Trenton Spinning Mills hurt by the closing of the 40-year-old mill.

Hard times already

The Georgia Department of Labor announced this week that 56,652 laid-off workers filed first-time claims for unemployment insurance benefits in September, an increase of 76.3 percent from a year ago. State Labor Commissioner Michael Thurmond said Georgia "is in the midst of a challenging economic environment" with unemployment already at the highest level since 1993.

Tennessee's top economic adviser, Dr. Bill Fox at the University of Tennessee, predicted a recession for Tennessee for the first time in the current economic cycle.

"Tennessee will be hit harder in tax losses this time than in the previous recession (2000 to 2001)," he said.

Christian Pilotzi, 23, is among those on the front lines battling the challenging job market. The mill worker bought a house in March after he landed his job the previous year at Trenton Spinning Mills.

"I've got to find another job, but I know that may not be easy in this market," he said. "It's tough all over."

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