Team Work Makes the Dream Work: After Factories Close, Leaders Unite to Turn Economy Around
What do you do when life delivers a bunch of lemons? If you're smart and resourceful, you make lemonade.
That's exactly what Campbellsville, Ky., decided to do a few years ago when a series of factory closings caused the unemployment rate to soar to 26 percent.
For a span of 50 years, while Fruit of the Loom operated an underwear factory in the area, the local unemployment rate never rose above 5 percent. At its peak, Fruit of the Loom employed 4,000 people. By the mid-1990s, that number dropped to 3,200. In June 1998, Fruit of the Loom shut down its Campbellsville factory to relocate to Latin America. Fruit of the Loom was the primary employer of Taylor County, home to 22,000 residents. The majority of the factory's work force had never worked anywhere else.
|Industrial recruiter Kevin Sheilley, left, and Mayor Paul Osborne of Campbellsville, Ky., stand outside Frost-Arnett Co., a bill collection agency that came to town in 1999. (W.D. McCubbin photo)|
Sheila Douglas, a 10-year employee, recalled the anxiety during the last few months at the plant and the mood when the closing was officially announced. "For most of us, it was a relief because for months we lived with the uncertainty of our future," she said. "It was scary and frightening."
Batesville Casket, another employer in the area, closed its factory shortly after, leaving an additional 200 people unemployed. The workers there and from the underwear factory joined a growing list of unemployed in this part of Kentucky as Fruit of the Loom closed two more plants, in Greensburg and in Russell Springs, and another clothing manufacturer, OshKosh B'Gosh, shuttered plants in Columbia and Liberty. In a period of 18 months, the region lost 8,000 jobs.
The wave of layoffs caught local governments off guard. Economic development was never a priority of the city and county governments—Fruit of the Loom provided economic stability. In retrospect, Campbellsville Mayor Paul E. Osborne said, Fruit of the Loom sent signals that it might move its operations overseas as much as 10 years earlier. However, when a community has experienced such a long period of stable employment and low unemployment, complacency can develop.
At a time when it would have been easy to throw blame around, local leaders decided instead to unite and quickly focus on turning around Campbellsville's unemployment woes. In October 1998, the city and county governments formed Team Taylor County Industrial Development Authority and established a strategy to economically revitalize Campbellsville.
They recognized the importance of having a diverse economy and committed themselves to attracting manufacturing, service and distribution businesses to Campbellsville and Taylor County. They leveraged the area's central location and accessibility to domestic and Canadian markets, the area's abundant work force, infrastructure, low cost of doing business, state financial incentives for businesses and education/training to attract industry.
A new industrial recruiter, Kevin T. Sheilley, was hired as executive director of Team Taylor County. He became the point person for representing the best interests of the community. A 1 percent employee payroll tax and a 1 percent tax on employers' profits were implemented to fund a portion of the industrial authority's budget.
Four months later, in January 1999, a new mayor, county executive/judge and university president took office.
Mayor Osborne identified four practices that were instrumental in helping to revitalize the city.
|Kevin Sheilley and employees of Frost-Arnett, Co., which employs 89 residents. (W.D. McCubbin photo)|
First, all community leaders—elected and non-elected officials—worked as a team. When Amazon.com decided to relocate to Campbellsville/Taylor County, Osborne said he received more positive feedback from entering the press conference to make the announcement side by side with Taylor County Judge/Executive Eddie Rogers than he did from the actual announcement.
Second, the community conducted an honest assessment of its strengths and weaknesses.
Third, a strategic plan was developed. "Planning is as important, if not more, as writing a budget," Osborne said.
Fourth, aggressive leadership was key. "The mayor sets the pace," he said. "Leadership ability at the top is super important."
Team Taylor County, a partnership of local governments, businesses, school systems and Campbellsville University, practices a coordinated approach to community and economic development. The mission of Team Taylor County is quite simple: to make the community a better place to live.
Sheilley's approach to economic development has yielded outstanding results.
In May 1999, Amazon.com opened its largest distribution center, which employs 1,152 people. Forty-five percent of Amazon.com's sales activity flows through Campbellsville.
In 21/2 years, Sheilley has recruited 11 companies to relocate to Campbellsville/Taylor County, and all of the jobs lost have been replaced, plus some. The 11 companies include manufacturers, distributors and service-oriented businesses.
"The more opportunities that economic development efforts can provide for a community, the better off the individual members of the community are," Sheilley said.
The relocation of these companies, along with the corresponding reduction in unemployment, has had a ripple effect on other economic indicators. Property tax assessments are up 19 percent, and retail sales are up 35 percent.
The town is home to Campbellsville University, a private, liberal arts institution that offers an MBA program. Recently, the university's new technology training center opened as a business-driven source for training options. The nearby Green County Area Technology Center offers additional technical training opportunities.
In 2001, the city applied for and received certification as a retirement community through the Kentucky Tourism Development Cabinet. To qualify, Campbellsville had to meet certain requirements and is now one of eight Kentucky cities with such certification. The state advertises the certified retirement communities in magazines such as Southern Living and AARP's Modern Maturity.
Since 1999, Taylor County has sought and received $6 million in grants—about half from the Community Development Block Grant (CDBG) program. Before 1999, Campbellsville/Taylor County had not received CDBG funds for 18 years because no one was actively seeking them. Two grants totaling $1,725,000 were received from the CDBG economic development pool, and two grants of $50,000 each were awarded for microenterprise development. An economic development application for $500,000 in CDBG funds to extend sewer and water lines to a new tourism project is being finalized. A women's substance abuse center under construction is being funded by a $1.5 million grant from the Center for Substance Abuse Treatment.
Community leaders also recognized that it was important for all residents of the city and county to benefit from the economic revitalization of Campellsville/Taylor County. Recently, a grassroots initiative called Greater Campbellsville United was developed to support, nurture and develop the minority community. LaWanda Hazard, coordinator, will help link the minority community with resources and contacts that can assist entrepreneurs, provide job training and raise education levels.
Community Ventures Corp. (CVC), a community development corporation with headquarters in Lexington, Ky., opened a satellite office in Campbellsville shortly after Fruit of the Loom shut down. Many displaced workers took the opportunity to become entrepreneurs, but needed help. Team Taylor County officials said CVC's presence has been an asset, providing quality entrepreneurial training and financing not available through commercial banks. Pamela Mann, business development specialist, has helped potential small-business owners obtain loans that range from as small as $500 to as large as $3 million through CVC's Continuum of Business Products.
Campbellsville's economic turnaround has been the result of strong leadership, creativity, risk-taking and a willingness to learn from the past. However, local leaders aren't resting on their success. They continue to plan for future economic expansion.
According to Sheilley, Team Taylor County recognizes that efforts must include not only diversification in the number and type of employers, but other economic developments if the community is to have a long-term recovery.
Taylor County's Top 15 Employers
Companies in bold opened after the Fruit of the Loom Factory closed in 1998.
|Amazon.com||Books and music distribution||1,152|
|Cox Interior||Hardwood moldings, trim, stair parts, interior doors, mantels||700|
|Taylor County Hospital||489|
|Taylor County School District||483|
|Wal-Mart Super Center||Discount Retailer||398|
|Ingersoll-Rand||Vacuum pumps, air conditioning, gas compressors||250|
|Campbellsbille Independent School District||240|
|Airguard||Air filtration products||235|
|Fleetwood Travel Trailers of Kentucky||Travel trailers||147|
|Campbellsville Industries||Steeples, cupolas, crosses, cornices, awnings, columns, louvers, shutters, railings, balusters||121|
|National Data Questing||Data collection||120|
|Parker Kalon||Threaded fasteners||110|
|Rosenbluth International||Corporate travel management||105|
Bridges is a regular review of regional community and economic development issues. Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.
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