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September 27, 2009
Zondra Scott was laid off Jan. 30. Two weeks later, her husband Steve lost his job.
The day after Zondra's work of 16 years ended, she said, their health insurance was canceled by her employer, Manufacturers Industrial Group, in Lexington.
The Scotts, who live in Lexington, have been out of work almost eight months.
"It's been real frustrating," said Steve, an industrial engineer. "It's hard to keep looking for work when nothing is there."
The Scotts' story exemplifies an economic nightmare that spans every county in West Tennessee, where unemployment rates remain in double digits. The fallout means that many families must make choices between wants and needs as the unemployed decide between looking for a job or returning to school to learn a new trade.
Relief agencies have been overwhelmed by requests for food and assistance, and lines are long at career centers, where people sign up for unemployment benefits and look for work.
Until last week, Henderson County, where the Scotts live, had the highest unemployment rate each month this year among 13 West Tennessee counties. The state released August unemployment rates Thursday that show Haywood County took the lead with an unemployment rate of 18.3 percent. That ranks 91st among 95 Tennessee counties.
Henderson County ranks 90th with an unemployment rate of 17.5 percent, and Carroll County is 87th at 16.2 percent.
Madison County fares better than many with an unemployment rate of 11 percent.
The unemployment rate is 10.8 percent in Tennessee and 9.7 percent nationally.
From Jan. 1, 2005, to Sept. 9, employers in 13 West Tennessee counties eliminated at least 7,700 jobs, according to Tennessee Career Center data. The job losses do not include layoffs or closings by small business owners, or large companies that laid off less than one-third of their workforce. So the losses likely exceed 10,000 jobs.
The Scotts
Zondra Scott, 36, and Steve Scott, 55, are among the hundreds who have lost jobs in plants that make products for the automotive industry in Lexington.
They married in 2003 after meeting at Johnson Controls, whose products included metal automotive seat frames. The Lexington plant was purchased by Manufacturers Industrial Group in December 2006.
Steve worked for Johnson Controls for eight years before being laid off in late 2004. He has since worked a half dozen different jobs, all in engineering. Those plants either closed or he was laid off.
His latest job was with a Caterpillar plant in Corinth, Miss. He left the house at 5:30 a.m. and drove 130 miles round trip each day. He worked nine months before being laid off Feb. 13.
"It's the only company I ever worked for that gave me a two-week notice," Steve said.
Zondra, who began working at Johnson Controls in Lexington in 1992, was laid off Jan. 30 by the plant's new owners, Manufacturers Industrial Group.
Though painful, the double blow to the Scott family was not a surprise.
"We suspected things were really going to get bad," Steve said. "And it did."
Zondra said, "I had been watching MIG lay people off 20 to 25 at a time; so you could see the writing on the wall. When it finally came, it was almost a relief. The stress of waiting for the layoff to come was the worst part."
Johnson Controls, which employed 700 in Lexington in January 2006, was down to 450 employees when it agreed to sell to Manufacturers Industrial Group. MIG now employs about 350, according to the Lexington Chamber of Commerce.
Knowing their jobs were not secure, the Scotts began to save more money in 2008 and watched their expenses more closely. That became more important after the birth of their son in May 2008. The household also includes Zondra's 16-year-old daughter from a previous marriage.
"At 16, sometimes they don't understand you can't go out in the front yard and pick money off a tree," Zondra said. "But she understands what we're going through. We've all had quite a few discussions about things we had to have and things we could do without."
But they couldn't plan for the loss of their health insurance the day after Zondra was laid off.
"That's the thing that probably hurt the most," Steve said. "We had to pay $934 a month for the first three or four months for the COBRA insurance. That was rough."
The Scotts received some relief when Zondra qualified for the Health Care Tax Credit. Because she receives unemployment benefits as a displaced manufacturing worker and has decided to return to school, the government pays 80 percent of the COBRA health insurance premium, which has increased to $1,034, Steve said.
"The insurance is virtually useless because we have to meet a $5,000 annual deductible before it pays anything," Steve said. "But we keep it in case something catastrophic happens."
Zondra begins classes Oct. 5 at West Tennessee Business College in Jackson, where she will study to be a medical assistant. She said federal and state grants will pay her tuition.
She receives $197 a week before taxes in unemployment benefits. Steve receives $230 a week.
"There's no way that anybody can make ends meet when both spouses are drawing unemployment," Steve said. "There's just not enough money."
"The only way we've made it so far is our savings and family," he said. "I got some early inheritance, and we've used our savings. So far we haven't had to touch the 401(k), but I might have to cash it out if things don't get better."
Zondra's mother, Wanda Wilson, lives in Bolivar and provides moral support. She hopes to arrange her work schedule to be off when Zondra is at school so she can help with the baby.
Steve doesn't know what his future holds. He considered returning to college to earn a master's degree and teach. But he would rather remain in engineering. He has filed resumes at the career centers in Lexington, Jackson and Bolivar.
"I don't know what the answer is," he said. "Industry, especially automotive, is not going to come back anywhere near like it was. They've moved so much work out of the country, they can't bring it back because the tax breaks aren't there."
"Right now the job market for industrial engineers doesn't seem very fruitful," he said. "I read where the economy is showing signs of improving and places might start hiring, but they will hire hourly workers before they hire salaried people.
"I think it will be the first of the year before anything picks up. I might have to travel more to get a job, which would make for long days. But right now there's just nothing available close by."
Henderson County
Henderson County's 17.5-percent unemployment rate trails only Lauderdale and Haywood counties in West Tennessee. Lauderdale County, which includes the cities of Ripley and Halls, leads the state with an unemployment rate of 19.7 percent.
Through August, 2,250 were unemployed in Henderson County, according to state labor statistics.
The loss of jobs is mainly because of layoffs by plants that make automotive parts in Lexington and cutbacks at plants in Madison County, where many Henderson County residents work.
More than 50 percent of Henderson County's industrial jobs are related to the automotive industry, Lexington Mayor Bobby Dyer said.
"Our factories have really been decimated here," said pastor Michael Adams of First Baptist Church in Lexington. "That's our biggest concern. And Lexington has become more and more a bedroom community for people who work in Jackson. Many of them have lost their jobs."
Gary Essary, 45, was laid off in March from Leroy-Somer, a Lexington plant that makes generators. It has laid off hundreds of people but remains Henderson County's largest employer with more than 800 workers, according to the Lexington Chamber of Commerce.
"I worked there one year and three days," Essary said. "It's a good place to work. But we went from working seven days a week with overtime down to two shifts."
Essary draws unemployment benefits, and his wife still works. But they have cut back on expenses, especially going out to eat.
Essary said he thinks the local economy has hit bottom. "I don't know if it's getting better, but it ain't getting no worse," he said. "I just know I don't like being unemployed."
He wants to return to school to learn new skills, and he's not alone. About 150 from Henderson County are receiving Trade Readjustment Assistance. That is a federal program that pays tuition for people to train for work in another field if they have been laid off and can't find employment similar to their former job. The program started in late 2007.
"We've had about 25 people complete their training," said Phyllis Forgette, who has worked at the Lexington Career Center for 27 years. "The problem we're running into now is it's hard to get everyone into vocational schools because they are full. And unless Congress does something, all these programs end on Dec. 26."
Bettina Webb is the Henderson County case manager with the Workforce Investment Act, another federal program that provides on-the-job training and occupational skills training for the unemployed. About 30 are in the program, and more than 100 are being interviewed.
"It has really been heartbreaking, with all the closures and layoffs," said Webb, who grew up in Lexington.
Career centers have been overrun. More than 41,000 unemployed people registered at career centers in 12 West Tennessee counties from July 1, 2008, to June 30. That's 12,007 more than the 2007-08 fiscal year. The numbers do not include Gibson and Crockett counties.
Community help
Dyer, who was re-elected as Lexington's mayor Sept. 10, has concentrated on bringing in jobs to help counter the losses. He has worked in Henderson County government for 30 years and remembers when the county's unemployment rate reached a high of 21.4 percent in January 1983. The county recovered with unprecedented industrial growth, and Dyer believes a similar scenario can occur.
"The automotive layoffs hurt," he said. "But I really believe we have fared very well during a global economic problem. We've been able to bring in quite a few new jobs during this recession, and we think we'll be in better shape than a lot of areas when the economy turns around."
One Lexington company is still hiring, Dyer said. Summit-Brantley Building Innovations, which manufactures pre-fabricated building components, has already hired 82 workers in its 54,000-square-foot plant, which produces material for residential construction. A new Summit-Brantley operation is expected to move into a 155,000-square-foot building and produce material for commercial construction, Dyer said. That will generate 200 new jobs, he said.
"It's expected, and we should be able to announce it within the next couple of weeks," Dyer said Thursday.
Most of Lexington's plants remain open despite layoffs. "So what we've tried to do is work with the existing industries so when the economy turns around, jobs can return and we'll be in a very strong position," Dyer said.
The Lexington community is reaching out to the unemployed in different ways. Churches are providing meals to members who are out of work, and more than 300 families were helped Sept. 19 when 16,000 pounds of food was distributed.
The Lexington Rotary Club and Lexington City School System organized the event through the Second Harvest Food Bank of Middle Tennessee.
"It was a huge volunteer effort," said Vicki Bunch, executive director of the Henderson County Chamber of Commerce. "There will be another food distribution through Lexington Hope Ministries on Oct. 31."
Laura Stone has volunteered at Hope Ministries for four years. She said the Oct. 31 distribution of 9,000 pounds of food is limited to 200 families. The first 200 to register and receive a voucher will be allowed to drive onto the parking lot of St. Andrew's Catholic Church in Lexington and pick up food. Signups are every Monday and Wednesday at Hope Ministries.
"We've seen a big increase in people needing help in the last year," Stone said. "But we've been very blessed with people from Lexington donating food and clothes. And the churches make donations, too."
Dyer's administration has implemented a program called Project Roundup to help provide tuition assistance for post-high school education. Henderson County residents are being asked to allow their utility bills to be rounded up to the nearest dollar. The proceeds will provide scholarships to high school graduates and dislocated workers wanting to return to school, Bunch said.
Garrett Davis, 22, isn't interested in returning to school anytime soon. He was laid off in May by Butler Manufacturing, a steel mill. Davis, who pitched on Lexington High School's 2002 state baseball championship team, wants to remain in Lexington. But work as a certified pipe welder is scarce in Henderson County.
"Things are trying to level off, but I think it will get a little worse before it gets better," Davis said. "Summit-Brantley is about the only place hiring right now. The layoffs are killing everybody."
Davis is considering moving to Louisiana, where work is plentiful for pipe welders, he said.
"It's very frustrating," he said. "Nobody around here is hiring unless you want to flip burgers. I'll go on the road before I'll do that."
Eddie Akins, manager of the Lexington Career Center for 32 years, believes diversity is the future for Henderson County industry and the job market.
"We've been hit, just like other counties, and a lot of our job losses were caused by the auto industry," Akins said. "It would be great if the auto jobs came back, but nobody can predict that. In reality, manufacturers may have to diversify."
"We met with Leroy-Somer (a Henderson County plant that manufactures generators), and they are looking at a plan to diversify," he said. "I think the state as a whole is looking at that. The stimulus money being used for the solar project in Haywood County is a great example of what needs to happen down the road. As years go by, I think that's what we'll be seeing."
Mayor Dyer said a brighter future is dependent on improved education.
"The work force will have to be better educated to compete," he said. "If we get spin-off jobs from the megasite in Haywood County, the workers must be skilled and trained and better educated."
Haywood County
With 1,680 out of work in Haywood County, government leaders have high hopes for a proposed megasite on a 1,700-acre tract of land along Interstate 40. State legislators must approve funding for the site, which officials hope will become the future home of a major manufacturer that would provide thousands of jobs throughout West Tennessee.
Two weeks ago, Gov. Phil Bredesen said the U.S. Energy Department has approved Tennessee's plan to set aside part of the megasite to build a solar-power generation plant, using a portion of the state's $62 million in federal stimulus money.
Bredesen said the 20-acre operation should begin generating electricity by early 2011.
Grant Hines, 26, hopes he doesn't have to wait that long to find work. He lives in Brownsville with his parents after being laid off from MTD/Cub Cadet, where he was an assembly worker earning $11.99 an hour. He was there more than seven years and has been looking for work about two months. He doesn't enjoy the down time.
"Sometimes it's cool, but you can't draw unemployment all the time," he said.
He said he qualified for three positions with three companies and applied for those jobs through the Jackson Career Center. He hopes one of the companies calls.
"It makes me feel good that there are jobs out there I qualify for," he said.
"You have things you want to do, and I want to help my parents out," he said.
Jackson Sun reporter Ned Hunter contributed to this story.
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