Des Moines Register
08-27-06
Knocked down, towns resolve to bounce back
Centerville, Newton aggressively work on ways to offset losses of jobs, plants
By WILLIAM RYBERG
REGISTER BUSINESS WRITER
Newton and Centerville are looking ahead to futures without their biggest
employers.
The towns will be different, but leaders in Newton and Centerville vow that their
communities will not only survive, they will thrive.
Strategies for getting the job done focus on change.
Both towns plan to avoid relying on one big employer again. Instead, they hope
to attract people and jobs through quality-of-life improvements - such as a
racetrack and a state park resort - and by encouraging local entrepreneurs and
existing businesses, as well as trying to attract new companies.
Even then, there's no guarantee that all the jobs can be replaced or that new jobs
will have comparable pay and benefits with those being lost. The Newton jobs
pay an average of $19 an hour; in Centerville, the average is $12.50 to $14.32 an
hour.
Making up for the loss is difficult, said Mark Edelman, a professor of
economics at Iowa State University. On average, most rural communities are
unable to replace jobs in terms of number or pay and benefits within a short
period, Edelman said. That doesn't mean that an individual community can't do it,
he added.
"Each community paints its own future," Edelman said.
The worst thing is to do nothing, he added. People move away if a community
allows itself to languish.
Centerville, with a population of 6,000, will lose 500 jobs when the Rubbermaid
plant ends production next month and closes later in the year.
"It's a good little community," Centerville City Council member Bob Greene said
of his town. "It just gets kicked around once in a while. But we come out of it."
In Newton, 1,800 jobs will be lost when Whirlpool Corp. closes the former Maytag
headquarters and a Maytag washer/dryer factory. Cuts have begun at the
headquarters. Closing of offices and the plant are to happen next year. Whirlpool
bought financially struggling Maytag in March.
"We can't approach economic development as we have in the past," said Kim
Didier, executive director of the Newton Development Corp. "Now, there's an
incredible sense of urgency."
Maytag sometimes employed up to 4,000 people in Newton, providing a solid
economic base for the community of 15,600. It was Maytag's headquarters since
its founding 113 years ago.
Part of Newton's strategy is to provide quality-of-life benefits designed to
maintain the community's population, helping to attract retail businesses and new
employers. The old economic model emphasized creating jobs to attract people.
The new model is to keep and attract people, with the jobs to follow, drawn by a
quality work force, Didier said.
The strategy can work, but increasing population is probably more workable in a
community with special attractions such as skiing or water access or beautiful
scenery, said Norman Walzer, professor of economics at the Illinois Institute of
Rural Affairs at Western Illinois University in Macomb, Ill.
The Internet and telecommunications give workers more choices in location, and
people are drawn to areas with first-class entertainment, leisure activities and
services, he said. Characteristics such as high regard for family values, good
schools and competitively priced housing are draws also, Walzer said.
Maytag engineers and marketing specialists, for example, might create
companies in town. Other towns have been successful in using former corporate
talent to build small companies in a single industry, gaining a reputation for the
specialty and prompting further growth, Walzer said.
Newton and Centerville hope to attract new businesses, but also want to create
jobs by helping to promote local entrepreneurship and expansion at existing
companies.
Community colleges in both communities are working on plans to offer education
and training to workers who lose their jobs. Among the programs: United Auto
Workers Local 997, which represents Maytag factory workers in Newton, is
working with the Newton campus of Des Moines Area Community College to
offer classes to build skills in English, writing and math.
Newton and Centerville leaders emphasize that developments were under way
before job losses were announced.
Among them: The new Iowa Speedway race car track and "Newton Promise,"
which would pay tuition at an Iowa college or university for Newton High School
graduates. Centerville is renovating the Ritz Theater on the town square. The old
movie house will become a theater for the live performing arts, said Keith
Sherman, president of the Appanoose Economic Development Corp.
Both cities have hired consultants to a map a plan for the future.
In Centerville, business owners Dan and Nancy Bennett say helping existing
businesses and local entrepreneurs is a key to dealing with the loss of
Rubbermaid jobs.
The Bennetts came to town 20 years ago and built their business, Dannco. It
includes a retail store on the town square, but most of its business is selling
athletic equipment to high schools, colleges and sports leagues. Dannco started
with a staff of three and now has about 20 employees.
Expanded tourism could help too, with jobs and with tourist business at stores,
gas stations, motels and restaurants.
"We are one of the prettiest parts of the state," said Nancy Bennett.
Iowa's first state-park resort, Honey Creek Resort State Park, will be built at
nearby Rathbun Lake. Expected to open on Memorial Day 2008, the resort will
include a 105-room lodge, indoor water park, 18-hole golf course, up to 35
cabins, trails, beach and boat ramp.
While Rubbermaid is closing, a few local manufacturers are expanding, including
C&C Machining, which makes parts for equipment makers such as Ottumwabased Al-Jon, a manufacturer of landfill compactors and car crushers.
Centerville leaders hold out hope that a new occupant or occupants can be found
for the large Rubbermaid plant. The building has been shown to a couple of
interested parties, said Bill Buss, a member of the board of two economic
development groups, the Appanoose Industrial Corp. and the Appanoose
Economic Development Corp.
Plans have been speeded up for creating a loan fund for small businesses and
start-up companies, said Buss. A feasibility study is under way on a possible
biodiesel plant.
Signs of past departures remain, however. A large factory that made toasters
and toaster ovens in the 1970s remains empty. It once employed an estimated
300 to 400 workers.
A coal-mining town in its early days, Centerville has survived when other
employers closed their doors.
When a commercial railroad abandoned tracks between Albia and Centerville in
the 1980s, a community-owned railroad was created to continue service.
"The town definitely has the tools" to survive, Nancy Bennett said. "In the past,
we've pulled ourselves up by our own bootstraps."