Help Wanted USA: Hiring Hotspots Emerge, but Mobility an Issue

Monday, 21 Nov 2011 06:57 AM

 

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It's not like the people in Fort Wayne, Ind., aren't sympathetic with America's unemployed. It's just that they're not seeing as many of them as the rest of us.

While most of the country is saddled with stubbornly high unemployment, numerous new construction projects and thousands of new jobs have made this Midwestern city of nearly 250,000 a pocket of relative prosperity.

"We've gotten not only a lot of jobs, but a lot of good-paying jobs," says Andi Udris, president of the Fort Wayne-Allen County Economic Development Alliance, "Sometimes you get lucky."

Fort Wayne added 8,000 jobs in the past year, almost half of the 18,000 it lost during the recession, including many in manufacturing. Its jobless rate has dropped by 1.3 percentage points to 8.1 percent.

That all helped to propel it to the top of the Fiscal Times' 10 Best Places to Find a Job list.

And it's not alone. There are other places with help wanted signs offering jobs with high wages. They're places like Wichita, Kansas; Worcester, Massachusetts and Twin Falls, Idaho.

That's particularly good news for the 5.9 million long-term unemployed Americans (those out of work for at least 27 weeks and still actively looking for a job), many of whom may soon lose their unemployment benefits.

Almost a third of the nation's 13.9 million unemployed haven't worked in at least a year, and nearly half are no longer receiving unemployment checks. That number could increase if Congress doesn't extend before year-end the emergency unemployment benefits of up to 99 weeks in the hardest-hit states.

Fortunately for them, hiring has been creeping up. Private-sector employment increased nationally by 104,000 in October and the U.S. jobless rate crept down to 9 percent from 9.1 percent in September.

"I think we're getting a little bit of hiring. The firing has stopped and the net is giving us a small amount of job creation," says Alan Levenson, chief economist at T. Rowe Price.

Much of the hiring has been in places like North Dakota and Iowa and in industries that support energy and agriculture, said Bob Lerman, an economist at the Urban Institute and a professor at American University.

"What we're missing from other business cycles is residential and other construction," he says. "That normally picks up when interest rates go down."

This time the extent of the housing bust has prevented that.

The new jobs are coming to Worcester, Mass., where unemployment has slipped to 7.7 percent, thanks to additional employment at local colleges, hospitals, financial firms and manufacturers.

"We don't necessarily hit home runs," says David Forsberg, president of Worcester Business Development Corp. (WBDC) referring to getting a big company to relocate to the city. "But we have done very well at expanding the base."

In Fort Wayne, homegrown ventures like Vera Bradley hired more than 800 employees this year. Known for its colorful handbags and preppy accessories, the company, which was founded in 1982, has been growing sales at a strong pace.

"We've had a great response to all the jobs we've posted," says Kate Virag, a spokesperson for the company, which had its IPO last year. "We want to bring jobs here. It's good for our community, our local economy."

Enormous growth persuaded the popular yogurt-maker Chobani to open a plant out West. It plans to break ground in December on a $100 million manufacturing facility in Twin Falls, Idaho and hire 400 workers in 2012.

The company, which opened in 2007 with five employees, now has about 1,000 workers at its plant in upstate New York. Sales are expected to reach $700 million this year, up from $300 million in 2010. "We can't wait for the economy to be right to invest," says company founder Hamdi Ulukaya. "We would lose two years."

In many regions, engineers and workers with specialized training also are in demand. Butler National Corp., which is headquartered in Olathe, Kansas, expects to hire 50 to 60 people in the next year or so because of a growing international market for its aerial spy technology. Sales are expected to hit about $50 million by April 2012, up from $40 million in 2011.

Ryan Menges, 24, is one of the new hires at its Avcon Industries subsidiary near Wichita, Kansas. "I was kind of concerned about the job market," says Menges, who graduated this spring from Wichita State University with a mechanical engineering degree. "I thought it would be a lot more difficult." About half his classmates still don't have jobs, he says, but his internship with the company and aeronautics-related skills helped him land his position.

RELOCATION PROBLEMS

There is only one problem in matching up places with job opportunities with the people from places of high unemployment. Many of the most distressed cities were also centers of the housing bust — making relocation very difficult.

Property values are on average down more than 30 percent since peaking in mid-2006, according to the S&P/Case-Shiller index, and in some markets such as Las Vegas it's down almost twice that amount.

It is not surprising therefore that the number of people who moved for a job dropped to 3.4 million in 2009-2010 compared with 4.6 million in 2006-2007, according to the Census.

The percentage of people who moved for any reason in the last year is the lowest it has been since the U.S. Census Bureau began tracking the number in 1948. Only 11.6 percent changed residences between 2010 and 2011, according to data released last Tuesday by the Census.

Some workers are reluctant to relocate because they're still receiving unemployment benefits, says Lerman. But many won't go because their homes are underwater. Almost 30 percent of individuals owe more than the value of their homes, according to a report released in November by real estate website Zillow.

Buying or even renting another home somewhere else is out of the question for many of these people. First of all they may not be able to afford it, and secondly few banks or landlords will want to deal with them if their credit record is shot to pieces.

Philene Harte-Weiner, who worked in nonprofit education until suffering a shoulder injury, would be happy to relocate for a new job but can't afford to because she and her husband owe $280,000 on a Delray Beach, Florida townhouse, which was once valued at $300,000 but is now worth $130,000.

She was home full-time with her infant son when her husband lost his job in the mortgage industry a few years back. He eventually found another position with the banking regulator, the Federal Deposit Insurance Corporation, in Alabama, but she's now looking for work to help pay the bills.

"Somebody has to stay here until we can get rid of our house," she says. "But as soon as the market turns around or as soon as we can take a loss on the house," they're prepared to relocate nationwide.

"I'll go anywhere in the country if I can cover my bills," says Harte-Weiner, 33. "If somebody said they would take care of the house, I would be there today. I would be on the airplane tonight."

© 2014 Thomson/Reuters. All rights reserved.

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