A look back at 2010: Jobs, Toyota top business stories in region

By Dennis Seid / NEMS Daily Journal

In September, the National Bureau of Economic Research declared that the Great Recession, which officially started in December 2007, ended in June 2009.
But the news from NBER, which is an independent group of economists charged with declaring when economic downturns begin and end, hasn’t translated into a economic turnaround just yet.
The Great Recession, after all, was the longest and deepest economic downturn since the Great Depression. And while the recession may be over, the jobs picture didn’t improve drastically in 2010.
Northeast Mississippi feels the pain.
Through November, the jobless rate in 2010 averaged 12.2 percent in the 16-county region. Last year, unemployment averaged 11.2 percent. In 2008, it was 8.2 percent. And in 2007, before the official start of the recession, the jobless rate was a manageable 7.2 percent.
How tough was the job market in the Northeast Mississippi? The region has been gripped by double-digit unemployment for 22 of the past 23 months. The rate topped 13.7 percent in February.
Nationwide, the jobless rate has hovered around 10 percent, and experts expect little change in the coming months.
Northeast Mississippi will unlikely see much improvement, either, despite spots of good news.
For example, the furniture industry, long centered in the region, could boast of several expansion announcements.
n Southern Motion in Pontotoc said in August that it was adding 200 jobs within two years and as many as 400 jobs in five years. In fact, the company is ahead of schedule: In January, 135 new employees will begin working at its newly expanded facility.
n Also in August, Albany Industries in New Albany said it hoped to add 200 workers at a newly acquired facility in Ripley.
n Last month, Delta Furniture Manufacturing in Pontotoc said it planned to add 50 workers next year.
But along with those and other furniture industry expansions came news during the summer that Caye Home Furnishings was laying off 600 workers with the closing of its New Albany plant.
“While the industry has been making big headlines with expansions and new jobs, the reality is that we’re not out of the woods yet,” said Ken Pruett, president of the Mississippi Furniture Association after Caye’s announcement. “We’ve got a lot of smaller companies who are struggling, and in this case, a well-established company struggling, too. So while we took a step forward with those expansions, we just took two steps back with this news.”

Other job announcements
Manufacturing accounts for up to a third of jobs in the region, with furniture making up a sizable portion. And while manufacturing employment across the country had declined overall, Northeast Mississippi has made some inroads.
Earlier this year, MTD Products in Verona said it was adding more than 100 jobs. In Ripley, Hudson’s Salvage LLC took over the former BenchCraft Furniture facility, turning it into a distribution center. The company plans to open 40 stores and add hundreds of jobs in the next four years.
Oxford and Lafayette County could get 1,000 jobs via Olin Corp., which plans to move its Winchester Centerfire munitions operations from Illinois. The transition could take up to five years.
But perhaps the biggest shot in the arm for the region happened in June, when Toyota announced it was resuming operations at its Blue Springs plant.
Two years ago, Toyota said it would delay the opening of the plant – originally scheduled for this year – because of global economic conditions.
But on June 17, Toyota confirmed that it would resume work at Toyota Motor Manufacturing Mississippi, as the Blue Springs plant is officially named.
In late August, the company began accepting applications for some 1,200 production employees, in addition to another 150 salaried workers. Toyota Mississippi will begin producing the Corolla sedan next fall.
Toyota anticipates having a total of 2,000 workers when the plant is fully operational in 2012.
In addition to the Toyota Mississippi jobs, suppliers to the plant are expected to employ another 2,000 workers.
However, even with the expansions and additions from furniture makers to automakers, the economy still is in recovery mode.
The Mississippi Institutions of Higher Learning last week said in its economic forecast that the economy would move along “at a snail’s pace.”
“Fiscal austerity and high unemployment rates continue to slow the pace of recovery,” said senior economist Marianne Hill. “However, several economic indicators confirm that the economy is gradually gaining steam.”
According to Hill, retail sales have been rising, many sectors are adding jobs and tax revenues are running at the levels estimated for the current fiscal year. But unemployment rate is hovering near 10 percent, and a funding shortage has brought cuts in several state programs. A return to 2007 levels of employment is not expected before 2015.
What does that mean for Northeast Mississippi?
Despite improvements in manufacturing and Toyota’s announcement, the new jobs created won’t significantly reduce the overall unemployment rate. Until the economy rebounds to a point that small businesses and other industries are confident in hiring, jobless rates in the region likely will remain at or near double digits for the immediate future.
And that’s a story that could reach far beyond 2011.

Contact Dennis Seid at (662) 678-1578 or dennis.seid@djournal.com.

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