US Labor Force decline 1990-2018.

Three Decades of Job Losses in Southwest Virginia

by Lewis Loflin

Southwest Virginia and East Tennessee have been decimated by 30 years of job losses. Likely 100,000 jobs have been lost between Roanoke and Knoxville. Many of the "new" jobs are marginal, low-paying service and retail jobs.

I have been tracking this issue since 1999 and the links below tell a story of how government on the one hand follows policies favorable to helping business that destroy American jobs. In particular this benefited multinational companies over domestic companies.

Domestic companies were force to resort to the same destructive practices as the multinational companies - a crushing war on labor through outsourcing jobs to low-wage hellholes or poor communities in America, sub-contracting, hiring illegal aliens, etc. plus automation.

Most of the these would go to automation eventually, but without the ability to wholesale destroy millions of jobs overnight the process would have been more orderly and less destructive to workers. Workers would have time to transition. Instead it was mass replacement.

The graphic above is a good example. President Clinton signed NAFTA and it went into force in 1994. Majorities of both partied supported.

Manufacturing had already been declining, suddenly exploded. In just 1 quarter alone we lost 8000 jobs in Tri-Cities. There was the DotCom bubble which we never benefited from.

Tri-Cities labor market 2007-2016.

Update September 3, 2019. Based on data from Dr. Steb Hipple economist at East Tennessee State University (retired), his data goes to the 3rd. quarter of 2016. The level of job losses is Tri-Cities is staggering, worse than what even I thought.

(The Tri-Cities Consolidated Statistical Area is composed of the Kingsport/Bristol MSA and the Johnson City MSA.).

The Bristol TN-VA, Kingsport, and Johnson City Urbanized Area Labor Market lost thousands of jobs shrinking the labor force that shrank the unemployment rates. The above table shows a decline of labor force by almost 18,000. But it gets worse.

Includes: Johnson City, TN, Carter County, Unicoi County, Washington County.
All workers BLS:
2016 78,140 workers, Median hourly wage $14.47, Annual $40,140
2018 77,020 workers, Median hourly wage $15.38, Annual $42,740
Labor force fell 1120 jobs in 2 years.

Kingsport-Bristol-Bristol, TN-VA MSA includes: Bristol city, VA, Hawkins County, TN, Scott County, VA, Sullivan County, TN, Washington County, VA.

All workers BLS:
2016: 118,470, Median hourly wage $15.27, Annual $41,050
2018: 116,150, Median hourly wage $16.50, Annual $43,480
Labor force fell 2,320 in in 2 years.

That's not the worst of it still. For Tri-Cities the total labor force is 193,170. The labor force shrank by 3,440 jobs in 2 years - during a so-called boom. In 2009 the labor force was 247,965, minus 193,170 equals a staggering loss of 54,795 less people are working in 2018 than in 2009!.

I can't believe this myself. Anyone working here knows it is bad. That could be explained by high poverty and disability rates, and large numbers of retirees leaving the labor force. I don't know because a lot of data is hidden from the public. But makes sense when we look at the national labor force declines.

The Atlantic article "Did NAFTA cost or create jobs? Both" Mar 22, 2017. He paints a rosy picture claiming GDP got a boost, etc. He is an apologist for NAFTA. Here is how he sees it. To quote,

A good example of this is fabric and clothes. As part of NAFTA, the U.S. made a deal with Mexico. It said, "Listen, we will drop barriers on Mexican clothes if you use American fabric to make them." So that way, Mexico would get jobs making clothing, and America would get jobs making fabric.

The result?

"Fabric production in the United States rose substantially after NAFTA," said Noel Maurer, associate professor of international affairs and business at George Washington University. "But jobs continued to decline because automation was wiping out jobs."

So those jobs went to robots. Not really NAFTA's fault.

This is deceptive. In this case I'm sure we sold plenty of cloth because that is easy to automate and hires few people. They even cut the cloth before shipping it south of the border to be sewn. That is the part where the jobs are and can't really be automated - yet.

So Maria in Central America faces employer abuse while sewing for 80 cents an hour. So American companies simply replaced most of their employees with foreign wage slaves.

This enabled companies to simply replace workers. That is all it ever was. It got worse in 2001 when the DotCom blew up. China entered the WTO and had plenty of wage slaves even cheaper than Mexico. NAFTA, automation, and outsourcing were drowning American labor. We were promised "high tech" jobs, etc. to replace the old jobs.

Never happened here or most of the country. Government tried every silly scam under the sun to create a real economy in Southwest Virginia. Politics, class warfare, and incompetence doomed the effort from the start.

They refused to address the policies that assured their failure. Economic development became a jobs programs for high salaried white collar bureaucrats, consultants, and contractors. China made an already destructive system even worse.

"The Elusive 'Better Deal' With China" by Gabe Lipman August 14, 2018 writes,
"By letting the country into the World Trade Organization back in 2001, Washington laid the groundwork for the tensions roiling relations with Beijing today."

On the labor side:

In retrospect, the United States wasn’t ready for the dislocation caused by the unprecedented scale of China’s economic rise. Smaller than France in 2001, China is now the world’s largest economy by some measures, and its preeminent trading power. Economists now acknowledge that the confluence of two factors—China’s rapid economic rise, and increased American exposure to Chinese exports that followed its membership in the WTO—adversely affected the employment and wages of many American workers in the early 2000s.

A landmark study by the MIT economist David Autor attributed the loss of 985,000 manufacturing jobs in the United States from 1999 to 2011, or about 20 percent of the total job losses in the sector during this period, to the so-called China shock...With its vast supplies of cheap labor, China had ready-made advantages when it came to churning out low-cost manufactured goods for export.

Like NAFTA China was about cheap labor which is de-facto government policy. See Government War on American Labor Good for Commerce

Southwest Virginia Population decline 2010-2018.

Government efforts to help made matters worse

Our ruling class sees commerce at any cost as positive. GDP is god and the rest of you can like it or burn in hell. The excuse was government will help you find new jobs or we will create them for you.

Their efforts only made matters worse - most failed outright. Note the huge population losses and poverty rates across the region. Hundreds of millions in subsidies and corporate welfare, nice four-lane highways, new broadband infrastructure - nothing. Because the corporate war on labor is raging on still.

Now throw in millions of immigrants and illegal aliens while this was going on. The opposition to mass immigration is about economics not race.

The problem was so severe that the New York Times noted ZERO private sector job growth from 1999 to 2009. In 2009 the housing bubble imploded driving the labor participation rates through the floor. There has been no real recovery in 2019.

What was gained from the DotCom Bubble was negated by mass layoffs across entire industries. Then China increases the bleeding, then near collapse with the housing bubble.

See No US Job Creation 1999-2009

An Example

Let's take an example. Call centers are among the worse paying, unstable jobs out there. Southwest Virginia has poured millions into bring in call centers promising thousands of new jobs.

Not only do they seldom produce the promised jobs, most pull out in some cases less than a year.

When the call center relocates they fire their existing workforce and come here expecting a low-wage work force. According to VCEDA call center jobs average $11 an hour in Southwest Virginia.

To put $11 an hour into perspective $1.60 was minimum wage in 1970 adjust for inflation is $10.46 in 2018.

The company gets millions in other subsidies from free buildings, etc. to outright cash gifts for the jobs. This gives them ability to under-bid another call center costing those people their jobs.

No

Predominant Face of American Poor is White and Liberals Ignore It

4 in 5 in USA face near-poverty, no work
Hope Yen, AP Business Writer September 17, 2013

As nonwhites approach a numerical majority in the U.S., one question is how public programs to lift the disadvantaged should be best focused - on the affirmative action that historically has tried to eliminate the racial barriers seen as the major impediment to economic equality, or simply on improving socioeconomic status for all, regardless of race...Hardship is particularly growing among whites, based on several measures...

The fact is affirmative action racism that has done nothing for minorities has devastated the poor white working-class who bore the cost of it. The article as usual avoided the negative effect of mass immigration that has pushed millions into poverty by importing more poverty.

Nationwide, the count of America's poor remains stuck at a record number: 46.2 million, or 15 percent of the population, due in part to lingering high unemployment following the recession. While poverty rates for blacks and Hispanics are nearly three times higher, by absolute numbers the predominant face of the poor is white.

More than 19 million whites fall below the poverty line of $23,021 for a family of four, accounting for more than 41 percent of the nation's destitute, nearly double the number of poor blacks.

Sometimes termed "the invisible poor" by demographers, lower-income whites generally are dispersed in suburbs as well as small rural towns, where more than 60 percent of the poor are white. Concentrated in Appalachia in the East, they are numerous in the industrial Midwest and spread across America's heartland, from Missouri, Arkansas and Oklahoma up through the Great Plains.

Buchanan County, in southwest Virginia, is among the nation's most destitute based on median income, with poverty hovering at 24 percent. The county is mostly white, as are 99 percent of its poor.

More than 90 percent of Buchanan County's inhabitants are working-class whites who lack a college degree. Higher education long has been seen there as nonessential to land a job because well-paying mining and related jobs were once in plentiful supply. These days many residents get by on odd jobs and government checks...

In the last decade government has spent $300 million on roads, corporate welfare, etc. in Buchanan County and like with inner city blacks the results have been zero. Social programs, government contracting, etc. creates jobs for those in the system, not the people it's targeted at.

Ref. www.usatoday.com.

Bristol Virginia population 17,835 in 2010, 16,482 in 2018. A loss of 1,353 people or -7.1%.

Bristol Virginia is 88% white, 21.3% poverty rate. It also has 13 public housing projects at last count.

With a disability, under age 65 years, percent, 2013-2017 16.3% or ~2,687 people.

Persons without insurance in Bristol Virginia 13.8% or ~2,275 people.

Per capita income in past 12 months (in 2017 dollars), 2013-2017 - $21,589.

History, Causes of Poverty in Southwest Virginia

Ralph Stanley Museum.

"The most corrupt region is Southwest Virginia...more indictments for political and public office corruption have happened in this region than all other parts of the state combined." Larry Sabato, director of the University of Virginia's Center for Governmental Studies.

"It's a little-known fact that roughly 20 percent of the children in Southwest Virginia live below the poverty line and go hungry every night." Kevin Crutchfield, President Alpha Natural Resources, January 15, 2009


Congressman Rick Boucher and President Obama

To quote Lenowisco Broadband Study Warned against Call Centers (PDF file):

"The region has been replacing traditional (better paying) manufacturing jobs with (low paying subsidized) call center jobs, which provide limited advancement and work opportunities. Call centers represent the factory floor of the Knowledge Economy; they are an important part of a diversified economic development strategy, but the region must be careful not to rely too heavily on them, as the work is easily moved to other regions and/or other countries."

No US Job Creation 1999-2009

Quick navigation of my homepage: