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Funding cut would devastate initiatives

How would proposed cuts hurt economic development?

A nagging problem crippling the state’s economic development opportunities is the lack of a skilled labor pool. If workforce training and development programs are cut, a primary draw for businesses to locate here, some decision-makers hinted they may seek better opportunities elsewhere.

“If these cuts are allowed to take effect, it will totally devastate workforce training in this state,” said George Walker, founder of Delta Wire Corp. in Clarksdale and chairman of the Mississippi Board of Community and Junior Colleges. “It will also devastate existing industry, the competitiveness of the whole state and our future economic development.”

Robert Bateman, human resources and training manager for Georgia-Pacific in Oxford, said when the company was determining where to locate an ultra high-tech particle board plant, a primary concern in the Oxford area was the labor force.

“I convinced and promised them that through workforce development training centers, we could provide the necessary training for this plant,” Bateman said. “Partially based on that, Oxford was awarded the plant.”

When complete, the $20-million Georgia-Pacific plant in Oxford will employ 70 workers, Bateman said.

“Being able to train workers was a huge advantage,” he said. “For every dollar the state gives us in training, we return in multiple dollars from increased salaries, plants and business expansion. I can’t believe that the Legislature, realizing this, would be willing to cut training dollars. Maybe we’re not getting the message to them.”

A recent analysis of Deloitte-Touche Fantus, an international consultant for the Community Development Foundation in Tupelo, indicated that the No. 1 factor in the creation of new jobs in northeast Mississippi was an educated and well-trained industrial workforce, said Harry A. Martin, CDF president.

“I hope that our state leaders recognize that the community colleges are the main player in meeting training needs of our workforce,” Martin said. “To reduce the investment in these institutions, at this time, will send a negative signal to those that are planning to locate or expand jobs in our state and northeast Mississippi, where the industrial base resides. In my opinion, we need more support rather than less funding for community colleges and their workforce training centers.”

Andrew Davis, plant manager of the Dana Corp./Plumley Division of Crenshaw, said the company made a critical decision in the last year to keep a 200-person facility located in Mississippi.

“We had some pretty good offers from the states of Tennessee and Kentucky,” he said. “The one major selling point to the management team’s part of the decision-making process was the availability of the skill tech centers and adult education training nearby as well as the community college with graduates we hire for salaried management positions. Much of what I’m hearing sounds to me like it’s a foregone conclusion that the legislators have made up their minds that they’re flat not going to give out dollars and I’m not sure why.”

Davis said money spent in workforce training and development is returned in revenue “tenfold at probably 10 times the speed for the state” compared to K-12 or senior college education.

“The impact long-term is what we need to be thinking about, not just 2001, or we’ll end up with a significant reduction in money because of a lower tax base because people will be making minimum wage instead of $11.50 an hour — because they don’t have an education,” he said.

Bob Boor, plant manager at Kohler Engines Division of Hattiesburg, said the company located in south Mississippi primarily based on training support.

“We’re two-thirds established, and we would not have accomplished what we have if it were not for the support of Pearl River Community College,” Boor said. “We’ve spent well over 100 times the money spent to support our activities. (Allowing such budget cuts) is like killing the goose that lays the golden eggs. It’s the most ludicrous thing I’ve ever heard of.”

The state’s community college system is designed to provide opportunities for affordable, practical and relevant hands-on education. One-Stop Career Centers, the centerpiece of the state’s heralded Workforce Training Act of 1994, would lose half of its funding if proposed budget cuts become reality.

Tom Traxler, an economic specialist at the Small Business Administration in Jackson, said the SBA partners with community colleges on training for small businesses.

“We provide some of the funding and they match it,” Traxler said. “In the past, we’ve had some threats and it looked like there would be cuts, but it ended up not being the case.”

Bill Baker, human resources director for Grand Casino Tunica, said partnering with Coahoma Community College’s Skill-Tech Center has allowed the casino to add 624 Delta employees at an average pay of $8 per hour. As a result, more than 400 people have been removed from welfare rolls in Bolivar, Coahoma, Quitman and Tunica counties.

“I’m real passionate about workforce development in the Delta,” Baker said. “Grand Casino is pouring over $20 million in payroll south of Tunica in the Delta. Two years ago, it was a negligible amount. I’ve never seen a more efficient — or more responsible — community college system in my career.”

Durward Stanton, plant personnel manager for Viking Range Corp. in Greenwood, said it is impossible to grow a business in an economy without workforce development training capabilities.

“Nobody fills that niche like community colleges,” Stanton said. “The brunt (of the budget cuts) will not only be felt by community colleges but by surrounding businesses. We’re prepared to do what we can to help in the fight.”

Contact MBJ contributing writer Lynne Wilbanks Jeter at lwjeter@yahoo.com or mbj@msbusiness.com.

About Lynne W. Jeter

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