Southwest Virginia Population decline 2010-2018.

DANA Automotive leaves Bristol Virginia for Mexico

by Lewis Loflin

NAFTA has destroyed jobs by the thousands in Bristol, Washington County, and Smyth County. DANA already fired 200 workers in Smyth County in 2002 and now Bristol and Buena Vista, VA will suffer the Mexico effect. While the loss of 270 good jobs is bad enough this will take down an additional 400 lower paying service jobs. To quote:

Dana will close two facilities in its Automotive Systems Group and shift production in several other operations to balance capacity and take advantage of lower cost locations Oct 20, 2005:

The Buena Vista, VA., axle facility will be closed and its production consolidated into an existing facility in Dry Ridge, Ky. The Buena Vista facility employs approximately 275 people.

The Bristol, VA., driveshaft facility will be closed and its production consolidated into Dana operations in Mexico. The Bristol facility employs approximately 270 people.

The assembly and component lines that support the steering shaft business in the Lima, Ohio, driveshaft facility will also be moved to Dana operations in Mexico. Approximately 100 of the 385 people at Lima will be impacted by this move.

DANA was Union as is Ball Corp. closing in Bristol Virginia May 2016 and local/state governments are union hostile hinting at this as the reason DANA went to Mexico.

In 2003 the local government worked with DANA to keep unions out, a longtime anti-labor policy of Bristol City Government. DANA claims the Union had nothing to do with their relocation to Mexico, but then Mayor Weberling whines anyway they can't get auto part plants to locate to Bristol because of the DANA union.

Weberling said the city in the past six months has lost two automotive company prospects that feared Dana being unionized would make it more likely a union would organize their workers, although Virginia and Tennessee are right-to-work states.

Quoting the October 21 2005 Kingsport Times-News, "They (Dana officials) said it's purely economic and they had no problem with the city or state...This is NAFTA (the North American Free Trade Agreement) at its best...We're willing to do anything we can do to keep them," Weberling said. "We'll have to make the best of a bad situation."

Didn't work.

Yet anyone with any brains at all knows auto parts plants are leaving the nation in droves union or not. The closing of the Teleflex Automotive in Lebanon, Virginia in late 2004 along with Assured Castings in August 2005 and TRW earlier in the year points to how bad the problem really is.

While recent price hikes in steel and a 40% power rate increase in Bristol are factors, DANA's payroll in Bristol currently exceeds $8 million - not including benefits, but can be done in Mexico for $1.3 million without benefits, safety, or environmental regulations. We should also note the loss of 270 good jobs can cost an additional loss of 400 lower paid service jobs.

U.S. Rep. Rick Boucher, D-9th, claims the pending job losses reverse a regional trend of job growth. During the past 10 months, more than 1,000 new jobs have been announced (they never materialized as of 2011) at a dozen facilities across Southwest Virginia and Northeast Tennessee. The city gained more than 2,300 net jobs between 1981 and 2001 (he failed to note twice that had disappeared), while Washington County netted more than 8,700 during the same period. (I directly wrote Mr. Boucher to justify that claim, he refused to answer.)

"If you look at what is lost, (it) was mostly sewing factories and apparel industries that didn't pay much and had no health or retirement benefits...Overall, you would have to say the jobs that have come since are better. Not all have benefits and some still pay minimum wage, but many are better." What the hell does that have to do with Dana? The reality is most of the "new jobs" since 2003 in fact pay little in benefits and perhaps $1 to $2 above minimum wage.

This website has presented to Congressman Boucher a request for just what those jobs were, he has refused to answer with any specifics. Let's note he said "announced," which in the past have been grossly inflated. If these new jobs are so great, why does the poverty level keep climbing? Why did Bristol lose population with those 2700 "net" jobs?

The Bristol area alone lost over 1000 jobs in 2003, there has been no major hiring in anything outside restaurants. The 8700 he claims for Washington County is absurd, unless we count minimum wage jobs held by kids. Bristol is also having budget problems due to falling tax revenues, traced to lower incomes.

In the election of 2010 Mr. Boucher lost his seat for a variety of reason and not just his association with President Obama and his vote for Cap and Tax legislation.

DANA closing doors

Quoting BHC October 21, 2005

In terms of local economic impact, the plant closing would affect about 400 other service jobs, said Steb Hipple, professor of economics and business at East Tennessee State University in Johnson City. "Those salaries are above average, so it will have a secondary impact of 1.4 jobs per employee," he said. "It sustains that kind of high ratio. "There has been an erosion of manufacturing jobs from the U.S. to Mexico and Asia for decades, and the people in Washington do not seem very concerned about it because it's market-driven...

Mr. Boucher poured in tens of millions in pork for the 2010 election, but he lost by 9,000 votes anyway. Local Tea Party and other patriots worked together to defeat Mr. Boucher, along with a slew of outside ads. Mr. Boucher's extreme money advantage was nullified. This was the biggest news story for 2010.

See Three Decades of Job Losses in Southwest Virginia

Note that minimum wage in 1970 was $1.60 adjusted for inflation is $10.46 in 2018. That is what I call adjusted minimum wage. Assuming one even gets 40 per week that's for 52 weeks that equals $21,756. Per capita income in Bristol Virginia 2018 is $21,589. It is similar to this across the whole region.

Third world? Some have called us the China of America minus jobs.

Just a few of hundreds of plant closings see Smyth County the China of America loses jobs.

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 2019 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.