Jerry Price is no stranger to working in a manufacturing environment. The North Carolina native toiled for years in textile plants in his home state before moving to Lynchburg to work for Ericsson, the Swedish mobile phone maker, about 15 months ago. He arrived expecting to encounter conditions he was used to: dirty factories, outmoded machinery and a work force dominated by low-skilled laborers, many without high school diplomas.

Frito Lay makes Dorito chips in Lynchburg Photo by Mark Rhodes

Lynchburg, by contrast, was a revelation. He saw workers at Ericsson using high-tech equipment, including robotics and other automation technologies that sped up production and lowered costs. Ongoing training kept workers abreast of advances in technology and advanced manufacturing processes.

Price’s experience illustrates the economic resiliency of the Central Virginia quadrant known as Region 2000, composed of the counties of Amherst, Appomattox, Bedford and Campbell and the cities of Lynchburg and Bedford. Despite a significant blow when Ericsson decided late last year to shift cell phone production out of the country, Region 2000 (the moniker has to do with total square miles, not the millennium) continues chugging along.

When Ericsson bolted, for instance, the 1,800 workers left behind, including Price, were immediately snapped up by another company, Alabama-based SCI Systems Inc. SCI already had a presence in Lynchburg assembling plastic phone casings on contract for Ericsson. Picking up new work in wireless infrastructure from Ericsson, SCI executives found the skill sets of Ericsson’s Lynchburg workers an ideal match. Since Ericsson’s departure, SCI has kept Price and his co-workers busy with new contracts assembling cash registers, cable modems and onboard circuitry for tractor-trailers. "When I came to work for Ericsson," recalls Price, who is employed as an automation technician, "I was amazed at the technical level of just about everybody in the plant."

Even though losing Ericsson was an expensive blow, Region 2000 can bask in its good times. It flourishes while other, mostly rural localities in Virginia cast about for solutions to diversify their moribund economies. Manufacturing is a big reason why, and Region 2000 — one of the first joint economic development initiatives in Virginia — helped nurture it. The region has built a strong reputation as a high-tech manufacturing center and crucible of research and development. Companies here use various types of advanced manufacturing — from automated production lines to injection molding to robotics —and sometimes employ more engineers than grunt workers.

Manufacturing alone is not responsible for the region’s vitality. Health care and education have emerged as major economic engines. Centra Health, a regional health care system, is the single largest employer, providing about 3,300 jobs. The region’s "Big Four" colleges — Central Virginia Community College (CVCC), Sweet Briar College, Lynchburg College, and Randolph-Macon Woman’s College — employ nearly 2,500 people. But manufacturing remains the most important and visible component of the local economy — accounting for nearly one-quarter of all jobs in the region. Only the services sector, at nearly 29 percent, is higher.

Frito Lay is expanding its Lynchburg plant by $15 million and adding 50 workers. Photo by Mark Rhodes

Stable manufacturing jobs have kept unemployment hovering around 3 percent, while helping companies boost output and efficiency. Such productivity defies the Dickensian stereotype that manufacturing equates to dirty sweatshops and dead-end jobs. The region’s highly motivated pool of skilled manufacturing labor continues to be a major draw for new industry.

Consider Frito-Lay. In 1998, even as it shut down plants elsewhere, the subsidiary of PepsiCo Inc. sank $150 million into a Lynchburg facility that produces snack foods with the fat substitute Olestra. The highly automated plant employs about 275 people, including a large number of chemists and technicians trained in electronics, instrumentation and automation. To Bob Bailey, director of the Lynchburg-based Center for Innovative Excellence in Advanced Technologies, the Frito-Lay plant illustrates how regional manufacturing has evolved. Observes Bailey: "Manufacturing here has gone from low and semi-skilled labor to an increased reliance on high technology. So even though we know anecdotally that the number of manufacturing jobs here is down, we also know productivity is up. Companies here are doing more with less."

Then again, companies have had little choice. Labor shortages are common nationally, but the dearth is becoming particularly acute in Region 2000. In a few years, the number of employees retiring from area companies will outpace the number of students graduating from local colleges and universities. What’s worse, many of those graduates aren’t even considering jobs in manufacturing, preferring "sexier" high paying occupations in the IT and white-collar technology industries.

The problem can be traced directly to wage stagnation. Per capita income in the Lynchburg area is around $24,000, nearly $6,000 less than Virginia’s statewide average, according to the Regional Economic Information System at the University of Virginia. Wages are slightly higher in the counties, but mostly are still lower than the $29,794 statewide average. With area wages flat and average home prices higher than many other southeastern metropolitan areas, most young career-minded individuals can’t afford to live here. The housing shortage also makes it difficult to recruit workers from other regions. Finding a home in the $80,000 to $120,000 range can be challenging. "The lack of affordable housing limits our growth. We’ve got the jobs for people who want to work, but they’re not going to move here if they can’t afford to buy a home here," cautions Rex Hammond, president of the Lynchburg Regional Chamber of Commerce.

To reverse the tide, regional business leaders are pushing coordinated work force preparation and training between high schools, local secondary educational institutions and industry. Rather than waiting for workers to come calling, businesses are using colleges as conduits to tap high school students pondering a career path. Programs in high-tech manufacturing are being pitched to area high school students so they will stay in the area. Instead of pushing four-year degrees, vocational educators are hawking two-year technical degrees. "It gives the course work more relevance," says Bailey, "if we can show a high school student that a machinist uses trigonometry every five minutes."

Targeting new workers and upgrading existing skills is a vital exercise. When Frito-Lay needed help finding qualified workers, it turned to the Center for Workforce Development and Continuing Education at Central Virginia Community College. The community college began evaluating potential workers and started training them in skills they lacked. Likewise, when SCI assumed Ericsson’s Lynchburg work force (and facility), it used the college’s work force development program to set up employee training in programmable logic controls, a highly automated process used during manufacturing.

Such programs are emblematic of a growing partnership between academia and business. Under CVCC’s associate of applied science program, courses could be delivered on site to employees, either before or after their shifts. The for-credit courses help workers advance career goals. "Our goal is to position the college to be able to meet the needs of local businesses. We’re asking businesses to tell us what their needs are," says Bill Spruill, coordinator of work force development at CVCC. An apprenticeship program can be a fast track to a journeyman’s card by offering academic training and on-the-job experience and can help the worker up the next career step. The college also established a program using computer-based skills to help locate top-notch employees for firms locating in the region.

Region 2000 has learned from some bad times, as well. One example is Ericsson. Ever since it first appeared on the scene in 1989 after buying General Electric’s Lynchburg operation, Ericsson represented a major coup. The Lynchburg operation steadily grew to include cell phone manufacturing, research on wireless infrastructure communications, and private radio systems. In 1997, the firm invested $30 million at its Lynchburg mobile phone manufacturing plant and hired 150 additional employees. Two years ago, state and local economic development officials lavished $1 million on Ericsson for a distribution warehouse. The company added still more workers and spent $20 million on new equipment and machinery. Employment ranks swelled to nearly 3,000 people.

But, things turned sour last December when Ericsson — reeling from plummeting stock prices that triggered massive company layoffs of 15,000 employees — pulled up roots. Seeking cost cuts, Ericsson shunned Lynchburg in favor of Mexico and Brazil.

The loss was a huge blow to the region’s prestige and sent tremors through the business community. Omnitech Engineering and Manufacturing Inc. of Lynchburg lost its largest local customer in Ericsson. Omnitech provides specialized manufacturing services to help companies get products to market faster. After relocating, Ericsson no longer needed Omnitech’s services, forcing the company to try and make up the revenue shortfall. "The only major customer we had in Lynchburg was Ericsson. In the short term, Ericsson selling to SCI has dramatically hurt our sales forecast for this year," says Paul Parks, vice president of sales and marketing. "It is still too early to tell if SCI will require our services as (much as) Ericsson did. So from our point of view, Lynchburg’s economic (position) is not very strong right now."

There are silver linings, though. Ericsson’s presence triggered much R&D work locally and gave rise to other wireless and broadband communications firms, such as Forest-based Grayson Wireless. Work on wireless infrastructure equipment that Ericsson started continues under SCI. Major national fiber-optic lines crisscross the region, and local executives hope there’s a way to take advantage of that. Region 2000 will sponsor a conference this fall on how to exploit it. Other industries brighten the outlook. Progress Printing, which started in Lynchburg in 1962, is undergoing a $9 million expansion.

Framatome ANP, a Paris-based company that supplies nuclear energy services, is gearing up for massive retooling of old nuclear plants seeking to be re-licensed by the Nuclear Regulatory Commission. BWX Technologies Inc., another atomic energy company that’s been around in one form or another since 1956, also will need new employees soon.