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Easley initiates grants to help manufacturing

At a state economic forum Jan. 5, experts had mixed news for citizens. The state's unemployment rate will decline. Interest rates will remain low. But the stigma of the failing manufacturing industry will continue to afflict many communities and dampen the state's performance, according to some business leaders. Most seem to agree that much of the industry is transferring overseas, where production costs are much lower.

   This is a trend with which North Carolinians have become familiar. So Gov. Mike Easley announced two days after the forum that 20 communities will receive $6 million in community development grants. Some of these are Entrepreneurial Assistance Grants aimed at retraining displaced workers. Most officials agree that re-education of the workforce is the best solution.

   "As we strive for one North Carolina, we must continue to look for new and innovative ways to prepare our communities and train our workforce for tomorrow's economy," Easley said. "With grants like these, North Carolina's communities are able to assist those in need and those workers who have fallen victim to layoffs and closings."

   Easley reminded attendees that for many communities, revitalization will happen but it will take time.

   Alamance County, located between Durham and Greensboro, is one such area undergoing transition. It has what the local Chamber of Commerce President Sonny Wilburn described as a traditional manufacturing economy.

   "It's been happening over the years," Wilburn said of the economic downturn. "There are second and third-generation workers who have never done anything but manufacturing."

   The county economy is largely dependent on textiles and hosiery manufacturing, one of the three sectors that has been hit the hardest in North Carolina, Wilburn said. With a large part of the workforce suited only to this type of work, local officials are desperate for any push they can get to help train residents in other areas. So the $10,000 Entrepreneurial Assistance Grant will be important in retraining through Alamance County Community College.

   Communities in Mitchell County, northeast of Asheville in the western part of the state, are experiencing some of the same effects from the shift of manufacturing overseas. But in a more rural setting and with a less developed economic base than Alamance County, this county has seen the loss of 2,000 jobs since 1998, said Shirley Hise, director of the Mitchell County Chamber of Commerce. This is no small loss for a county of roughly 15,000 people, according to a 2000 census.

   The closings include a hosiery plant and a furniture plant, typical casualties of the changing economy in North Carolina.

   "We have been identified as one of the most economically challenged counties in the state," Hise said. "When you have something like this happen, you also tend to look at the real problems underneath."

   At Hise's high school, many people who planned on working at the textile mill for 30 or 40 years, dropped out, she said. So when it became clear to county residents that there was a lack of job skills relevant in a twenty-first century economy, the focus shifted to the importance of education.

   "Some of those people don't have high school diplomas," Hise said. "[The grant] will be focusing on getting those people the skills they need. We pretty much realize we're not getting a Ford Motor Company or Microsoft [facility] here."

   Wilburn admitted that some of the job loss in Alamance County is due to investing in equipment and machinery to increase efficiency.

   "At one time, it took 600 people to run a cotton mill," Wilburn said. "Now it might just take 50 or 60 with new equipment."

   However, Easley continues to blame the overseas exports for the closings and has been outspoken in his support of textile quotas, which impose limits on the number of textile imports to the United States. He has urged business leaders to lobby the federal government in order to keep them in place. But some doubt the overall efficacy of quotas in easing the domestic situation.

   "The textile quotas are a very costly way of protecting the North Carolina industry," said Edward Tower, professor of economics at Duke. "It makes textile imports much more expensive to North Carolinians, and we don't even get any tariff revenue. We just simply shouldn't be producing textiles."

   Instead of quotas, Tower proposes a common answer to the problem.

   "What we should be doing is encouraging education and giving aid to everybody who's being hurt--regardless of whether they're being hurt by imports from China or changes in technology. You just want to get people out of dead-end jobs."

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