Why Atlanta, not San Jose, tops job ranking

From tortillas to trucking, a diverse economy puts Atlanta first in job growth for US cities in the 1990s.

As uncooked tortillas spill off the conveyor belt, Roberto works fast, hand-stretching the dough before sending it down another conveyor for cooking and packaging.

Nearby, his boss explains the operation over the whirring machines. "We make everything to order, 100 percent natural," says Ruben Rodriguez Jr., vice president of Los Amigos Tortilla Factory.

That's his niche, and by it the company has prospered - and steadily added jobs - even as it has gone from being the only tortilla factory in the Southeast to one of eight in Atlanta alone.

Mr. Rodriguez is witness to what economists have marveled at for a decade: Atlanta created more jobs in the 1990s than any other US city - half a million since 1993.

At the fulcrum of the 21st century, Atlanta represents what the job engines of the future will look like. Its recipe for rolling out jobs doesn't depend on being home to a Dell, Microsoft, or other icon of the New Economy, but rather on broad-based entrepreneurship.

"It's Wal-Mart and Mrs. Fields Cookies," says David Birch, president of Cognetics Inc. of Cambridge, Mass., which tracks US job creation and growth. "It's all kinds of revolution in every sector rather than a single sector driving it."

Even more than Silicon Valley, cities such as Atlanta, Phoenix, Salt Lake City, and Raleigh-Durham, N.C., possess this diversity and are the nation's strongest job producers.

These cities, topping Mr. Birch's list of entrepreneurial "hot spots," have found success in a blend of bedrock amenities: good schools, unclogged airports, skilled labor, and attractive, low-cost living.

Beyond that, Birch says these job engines show exceptional tolerance for "wild and crazy" people and ideas. "Ted Turner [CNN founder and Atlanta Braves owner] wouldn't last a minute in Boston," Birch says. "We'd say under our breath: 'He's made his money recently.' "

Pothole politics also holds back many older cities. While Phoenix has already begun work on a second airport, Boston is dragging its feet on expanding its old one. Salt Lake City is helped because its mayor is a former businesswoman.

The importance of mundane factors like airports and housing costs doesn't mean technology is unimportant. Far from it. But among the 50 biggest metro areas, San Francisco-Oakland-San Jose ranks only as the No. 31 job hot spot.

In the end, analysts say, job growth isn't driven so much by the high-tech industry itself as by the deployment of technology across all economic sectors.

In Atlanta, Los Amigos has learned to work smarter - upgrading to digital factory equipment and using satellite technology to track delivery trucks.

Similar stories, from restaurants to trucking, fueled Atlanta's creation of 100,000 jobs in 1999, leading the nation.

"The Atlanta economy is showing the capacity to readjust," adds Donald Ratajczak, director of the Economic Forecasting Center at Georgia State University. "It's not that we have a job base [in a single industry] that's all of a sudden hot. We're changing what we're doing."

But the growth hasn't come without strains. Atlanta's unemployment rate has plunged well below the national average - sometimes below 2 percent.

"Historically, we have had to find jobs for people to fill," says Michael Thurmond, labor commissioner of Georgia. "Now we have to find people to fill jobs."

That leaves employers scrambling, unlike previous years, to lure workers with training, stock options, extra pay.

"A job that used to take three or four days to fill, now takes three or four weeks," says Ren Daz, president of Daz Foods here. He's been hiring ever since founding the company in 1980, but now it's getting tougher.

"We have an accounting information-system manager, paying [as much as] $45,000 to $50,000 with experience, and we can't fill it," he says. "People are willing to take $30,000 at a dotcom company, as long as it has stock options. Sometimes I get jealous." The job market is so tight, he says, that "I would welcome a slight recession."

Given these strains, experts ask: Can young cities like Atlanta and Phoenix sustain this kind of rapid growth?

"We could blow it," says economist Mr. Ratajczak. "We can make it so that nobody wants to live here - because the roads are too congested, the air quality is bad, no one wants to send their kids to school in trailers, and every six months there is a building moratorium."

Problems are already evident.

Two years ago, the US Environmental Protection Agency threatened to withhold federal highway funding if something isn't done to clean up the city's air.

But by one forecast, Atlanta will continue to top US job growth, adding another 2 million jobs in 25 years.

Driving south on Interstate 85 in his luxury Mercedes, license plate TRTLLA, Rodriguez isn't worried by the growth - even the rise of competitors. "There's enough business here for everybody."

Entrepreneurial 'hot spots'

Atlanta, the leading job creator, also ranks high for its business start-up climate.

* Phoenix

* Salt Lake City

* Atlanta

* Raleigh-Durham, N.C.

* Indianapolis

* Washington

* Memphis

* Orlando, Fla.

* Dallas-Ft. Worth

* Nashville, Tenn.

Source: Cognetics Inc.

(c) Copyright 2000. The Christian Science Publishing Society

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