By Lewis Loflin
In 2002, Bristol Virginia Utilities (BVU), a city-owned utility, initiated a fiber-optic expansion to enhance economic opportunities in Southwest Virginia. BVU’s telecommunications manager, Jim Kelley, stated:
A fiber-optic network will make all the difference in allowing Bristol's business community to grow and compete for jobs on the upper-end of the wage scale. We cannot afford to wait for private industry to deliver competitive broadband services.
Despite an investment of over $120 million in public funds from 2002 to 2013, the region has seen limited growth in high-tech or high-paying jobs. Employment has primarily expanded in retail, hospitality, and call centers, averaging $12–$15 per hour in 2025, sectors that typically do not require advanced fiber-optic infrastructure.
Over the past two decades, economic strategies leveraging technology and incentives have not yielded the anticipated job growth in Southwest Virginia. The expansion of fiber-optic networks has often led to competition among rural communities, such as Bristol and the Tri-Cities, for jobs that offer modest wages. BVU’s OptiNet, sold to Sunset Digital in 2016 for $50 million, reduced municipal debt but did not catalyze a tech sector.
Recent state efforts, including $1.5 billion in federal broadband funding since 2021, have improved connectivity but show similar patterns of limited high-tech job creation. Population in counties like Buchanan and Russell has declined by 3–5% since 2010, reflecting ongoing economic challenges in manufacturing, mining, and agriculture.
Public investment in SWVA’s broadband infrastructure likely surpasses the $200 million estimate. BVU alone spent $120 million from 2002-2013, while LENOWISCO areas received $45 million in 2010 federal stimulus funds. Since 2021, Virginia’s $1.5 billion in federal broadband funding has included grants like the $25 million USDA Reconnect Grant for Scott County in 2023. Additional incentives, such as the $9 million for Northrop Grumman and CGI in Russell County, push the total closer to $300–$400 million over two decades—yet high-tech job growth remains elusive.
While an estimated $200 million in public funds supported SWVA’s broadband and tech initiatives, the actual investment is likely much higher—potentially exceeding $300 million when accounting for federal grants, state incentives, and undisclosed subsidies. Much of this information remains hidden from public view, a common practice in economic development to shield competitive strategies or avoid scrutiny. This lack of transparency complicates efforts to assess the true impact of these investments, particularly in the information sector, which saw a 45% employment decline from 2010-2020 despite national growth.
The following examples illustrate the outcomes of fiber-optic investments from 2002 to 2013, with updates to 2025:
Lenoir, impacted by manufacturing declines, provided $265 million in incentives to Google in 2007 for a data center expected to create 220 jobs. By 2013, only 150 jobs were added, many in low-skill roles. As of 2025, Google employs about 250 workers, but high-tech positions remain limited, with call centers more common.
By 2013, BVU’s OptiNet accumulated $50 million in debt, supplemented by grants, yet failed to attract significant tech employment. In 2012, Sprint and US Solutions relocated 500 call center jobs to Bristol, Tennessee, drawn by incentives, costing Virginia taxpayers $5–$10 million without new job creation.
Call centers, paying $12–$15 per hour in 2025, remain prevalent. Bristol, Virginia later invested $65 million in retail development, shifting focus from tech goals.
Bristol Virginia Utilities Fiber-Optic Outcomes
In 2004, a $25 million taxpayer-funded industrial park with fiber-optic infrastructure attracted Sykes, which closed a nearby Kentucky call center, eliminating 400 jobs. In 2010, Sykes reduced jobs in Wise, Virginia, while adding about 100 jobs in Buchanan, raising concerns about funding compliance.
Buchanan County Sykes Employment Issues
A $7 million industrial park in 2000 hosted Nexus’s call center, which promised 550 jobs but delivered 188. Travelocity, taking over in 2001, pledged 500 jobs but offshored to India by 2005, leaving 250 jobs, many part-time. In 2005, SI International added jobs at $9–$10 per hour under a federal contract.
Travelocity’s Closure in Dickenson County
In 2005, Northrop Grumman and CGI committed to 700 jobs with $9 million in incentives. By 2010, only 170 jobs were created, primarily in call centers paying about $9 per hour, far below the projected $50,000 annual salaries. The Bristol Herald Courier (October 17, 2010) reported:
Did they bring an overnight sensation and a great influx of population or commercial development—we are still working on that. —Jim Gillespie, County Administrator
High-tech job growth has not materialized, and the county’s population declined by 5% by 2010.
Virginia allocated $1.5 billion in federal funds to broadband since 2021, aiming to enhance economic prospects. While connectivity improved, rural areas continue to see growth in low-wage sectors rather than high-tech employment, consistent with earlier patterns.
A LENOWISCO study foresaw non-unionized call centers’ collapse, warning of offshoring risks (Asia’s $1–$5/hour wages), low-skill reliance (~30% no high school diploma, 2003), and firms exploiting subsidies, like VCEDA’s $5.6 million for Sykes. Non-unionized sites lost ~2 million U.S. jobs by 2015, unlike AT&T’s protected workforce. Education gaps—~50% no diploma in Dickenson County (2008)—worsened vulnerabilities. LENOWISCO Study, sullivan-county.com
| Sector | SWVA (% Decline) | USA (% Change) |
|---|---|---|
| Arts, Ent., & Rec. | -20% | 6% |
| Wholesale | -25% | 3% |
| Construction | -35% | 24% |
| Information | -45% | 2% |
| Mining | -50% | -11% |
Notes: With the exception of mining, SWVA saw the greatest decline in sectors that grew nationally. Decline in the region’s mining sector also exceeded decline in the national mining sector. A total of 10,451 jobs were eliminated across these five sectors, 16,774 jobs were eliminated between 2010-2020. The 45% decline in the information sector occurred despite an estimated $200 million in public investment, though the actual figure is likely much higher, with significant data withheld from public view.
Ref: Zach Jackson, Virginia Tech
Fiber-optic investments in Southwest Virginia, including $120 million from 2002 to 2013, have not produced significant high-tech job growth. Retail, hospitality, and call centers, with wages of $12–$15 per hour in 2025, remain dominant in areas like the Tri-Cities. Economic development agencies have increasingly focused on government contracts and service sectors.
Population declines and limited opportunities contribute to outmigration, with 8,000–10,000 college graduates annually seeking jobs elsewhere. In 2004, Sullivan County Commissioner Jack Sitgreaves observed:
We do not have the level of jobs in this area to sustain the number of graduates from our local colleges.
Originally posted September 24, 2013. Updated April 15, 2025.
Acknowledgment: I’d like to thank Grok, an AI by xAI, for helping me draft and refine this article. The final edits and perspective are my own.
