Eastern N.C.'s economy struggling

Millions invested, but poverty lingers

Millions of dollars in public and private money have gone to Eastern North Carolina in recent years to resuscitate an ailing economy.

Entrepreneurs and developers have hatched ambitious plans to bring thousands of jobs. Last year, the state offered about $2.5 million in enticements to get companies to expand or relocate in the 41-county region.

But the efforts are having little effect. The region still has more poverty, more high school dropouts and fewer college graduates than the rest of North Carolina, according to a new report from the N.C. Center for Public Policy Research.

For every step forward, Eastern North Carolina has been set back by declines in agriculture and traditional industry, say the authors of the report, which revisits research done five years ago. "There's still a lot of work to be done," Mike McLaughlin said. "The needs are broad."

The region is home to about 1.8 million people and includes a land mass three times larger than the state of New Jersey. Because of its size, advocates say the entire state has a vested stake in helping the area thrive.

"We all contribute to the state coffers," said H. Kel Landis III, co-chairman of the Foundation of Renewal for Eastern North Carolina and an adviser to Gov. Mike Easley on statewide business development. "Our whole state can't rise if one region is in distress."

The nonprofit, nonpartisan public policy center studied the region in 2001, and recently returned to see if it had progressed. It found a region still defined by despair.

* Three of four workers Down East are employed in the service or retail sectors, most in lower-paying, nonprofessional jobs.

* The region is more dependent on federal, state and local government jobs than other areas.

* Manufacturers represented a smaller portion of employers than in the state overall. But they were among the largest employers in more than half the counties in the region, providing low-skill jobs that easily can move offshore.

Agriculture has been the driving force of the area for generations. Indeed, the region includes seven of the state's 10 largest counties in agriculture production.

But changes are shaking up that sector. The federal tobacco buyout program is disrupting the livelihood of some farm families. Environmental regulations threaten hog and other livestock production, the report said. And debate rages about the benefits and risks of farm consolidation.

"The region leans too hard on the plow of agriculture to pull its economy, when agriculture is a troubled economic sector," McLaughlin said.

There have been many efforts to diversify the economy.

Last year, Rocky Mount won a Cheesecake Factory bakery that eventually could employ 500 people. Wilmington won an expansion of General Electric's nuclear energy division that could create 200 jobs. In Roanoke Rapids, the brother of country music star Dolly Parton says he plans a music theater to rival Branson, Mo.

Still, developers and entrepreneurs can't stay ahead of the declines. In Edgecombe County, 344 lost their jobs last year when Glenoit Fabrics and a related business shuttered operations, although some jobs have been brought back. Weyerhaeuser idled about 200 workers when it closed a paper plant in Plymouth. Black & Decker has announced plans to shut a plant in Fayetteville, cutting 675 jobs.

Reviving Eastern North Carolina will take creative thinking, said Landis, who is the former CEO of RBC Centura bank. He and his foundation are trying to do a better job of marketing the region's strengths, which include striking scenery, a good climate, open space and low costs. The region, he said, needs to focus on building "home grown" businesses as much as enticing others to relocate.

The policy center's report concluded that success will come from multiple efforts on many fronts. It's not enough to have the Global TransPark industrial site in Kinston or the billion-dollar international port now being proposed near Southport. It will take different approaches for different parts of the East.

"It took decades for us to get to this point," Landis said. "It's going to take more time than we probably like to reverse these trends."