Anderson, Ind., set on beating back high joblessness

By , Staff correspondent of The Christian Science Monitor

Everyone in this automobile parts-producing city knows what Anderson's biggest problem is. They remember only too well the national attention that came their way last year, when unemployment edged over 21 percent and set a record for the nation. Although now a more modest 11 or 12 percent, the rate is still the highest in Indiana, and virtually everyone here feels the pinch in some way.

But as you travel the streets of this pleasant community, where American flags often stand as tall in front yards as the trees and spring lilacs are just starting to come into bloom, you won't find a lot of hand-wringing. There is a strong Midwestern tradition of self-sufficiency here that civic leaders, in their united effort to bring more jobs to Anderson, appear determined to revive.

"I think we can do it ourselves and we've got to," says Mayor Thomas McMahan (R), who was a retailer until his election last year and, since then, has been given high marks for his leadership qualities and grasp of the problem from most corners of the community, including labor and management.

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"The major thrust, if possible, should come from the private sector," the mayor says. "All these federal programs have been fine. And if there's a grant I can get, I'll go after it. But I think they're overextended to the point where some people have become addicted to them. We've all been heading down the primprose path, and it has to stop somewhere."

He recalls that some years ago when a group of 14 local churches was trying to build an apartment complex for elderly residents with the help of federal funds, the Washington money suddenly became unavailable. Rather than abandon the project, the churches expanded their ranks to 20, found a trust fund to tap, got a loan from five local banks to match the trust contribution, and gathered the rest in pledges from their members.

As the mayor puts it: "We prayed, and it worked."

Like most cities facing economic problems these days, Anderson is in hot pursuit of economic development wherever it can be found. Indeed, it is such a priority in this city of 65,000 just northeast of Indianapolis that Anderson has not one, but at least a half dozen economic development agencies in full operation. Some focus on clearing land and approving projects for industrial revenue bonds while others zero in on recruiting. But all share the goal of beefing up business and jobs for the city.

One key community decision made in the course of that work (and as a result of studies by the city's federally assisted Automobile Community Adjustment Program) was to look for the primary answers to the unemployment problem within the city's own boundaries.Existing small businesses are to be encouraged and nurtured.

"We'd all like to bring in a company from the outside that would employ 5,000 workers, but there aren't that many going around," explains William B. McCarel, program manager of the Anderson Downtown Development corporation. "Last year about 400 manufacturers relocated, and thousands of communities were out there waving flags, offering free meals and land; it's highly competitive. . . . Actually, 95 percent of the development in most communities comes from within as a local manager or retailer decides to expand his base."

"Our main objective now is to keep what we have and expand it," confirms Jim Priest, director of city planning. Efforts directed outside the city will continue but will be targeted to specific growth industries, such as energy. "There's no reason for us to look for additional auto business," he says.

Several small businesses have left Anderson in the last few years, for varying reasons. But one new discount department store (offering 160 jobs; there were 1,800 applicants) opened here a few weeks ago and another is slated to open in August. At least two local industries are planning expansions that will lead to some new jobs, and civic leaders have been intensively courting an alloyed castings firm that is expected to open its doors here next year.

"We're working our tails off to bring those lost jobs back, but we're also working toward diversification," explains Mayor McMahan. "You've got to just keep trying enough things so that every once in a while you hit one. What we've got going for us now, I think, is a spirit of awareness of the problem and cooperation in fighting it that we probably didn't have when times were better. People realize they've got to work together."

Anderson's united approach surfaced early in the crisis when the two major local employers -- the Delco-Remy and Guide divisions of General Motors -- began laying off employees by the hundreds. Creditors soon eased up accordingly on bill-paying requirements.

Tom Frye, president of United Automobile Workers Local 662, says lending institutions and the local utility company have been particularly cooperative in postponing the time and amounts of payments. His unit maintains a crisis time and amounts of payments. His unit maintains a crisis center with a direct telephone line to mayor's office to help members cope with their problems.

But close to 3,000 workers from the two GM divisions still have not been recalled. For many, federal unemployment benefits are close to the end or have already stopped. The number of those receiving welfare and food-stamp help has been up accordingly in the first months of this year, says clifford Bennett, director of the Madison County Department of Public Welfare.

Although no one has exact figures, estimates are that as many as 200 of the unionized employees have transferred to other GM divisions in Oklahoma City, Albany, Ga., and elsewhere.But one of the critical problems that remains is the great disparity between wages and fringe benefits unionized workers have become accustomed to and the levels in jobs offered through the local office of the Indiana employment service. Job openings range from dog groomer and parking lot attendant to salesperson and experienced doughnut baker. Even the Baltimore and Fort Worth, Texas, police departments have tried to recruit here.

"The General Motors benefits are out of this world, and there's just nothing that's comparable in pay," says Martha Relford, placement and counselling superviser with the Indiana Employment Service in Anderson. Still, she admits, she sees signs that sights may be lowered. Although many have told her they would move before taking a job at minimum wage, she recently offered a bank teller job to one laid-off employee with seven years seniority, whose benefits were exhausted. There was a long pause and a sigh before the answer finally came: "Well, OK."

Indeed, civic leaders say that the wage differential in the past has been a prime factor in discouraging other businesses from locating in Anderson and pulling workers away from small businesses already there.

Mr. Frye contends that laid-off workers now are discriminated against by employers who don't want to offer permanent jobs to workers who might one day be recalled. "They really don't get a fair chance," he contends.

Some local businessmen doubt that unionized employment will ever again be what it once was here and predict that some day union wage levels, perhaps through profit-sharing or other such device, will be forced downward. But, for the moment, Frye and other union members remain publicly confident that the wage levels will hold and that the lost jobs will be reinstated.

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