Buckling down to reality: All of silver's economic eggs aren't in a copper basket any longer - Economic Profile: Silver City

New Mexico Business Journal, Jan-Feb, 2002 by Debbra O'Hara

SILVER CITY RESIDENTS COULD teach investors a thing or two about taking a long-term view of the economy In spite of repeated layoffs in its most prominent industry, Silver City continues to hope and plan for recovery.

Extensive planning and lots of legwork brought a significant new employer to town last year. Stream Technical Support Center has given the unemployed and underemployed members of the community a chance to increase their technical and computer skills while earning a paycheck.

"They have been great contributors to the community, a welcome addition," Judy Ward, assistant director of Grant County's Small Business Development Center, said. But the company didn't just show up magically on the doorstep. "We started preparing for companies like Stream over 10 years ago."

Ward explained that it takes a lot of money to make the necessary contacts for business recruitment through trade shows and other channels. "It's difficult to get results," she said, "We hope the governor and legislature will address the need for money for marketing."

To make the dollars go further, Silver City/Grant County Economic Development (SIGRED) executive director Linda Kay Jones has joined other New Mexico economic development officers to visit New York, Dallas, Chicago, and Los Angeles to promote New Mexico in general and to leave specific information about their area.

"New Mexico is not even on the radar of site consultants," Ward said.

The group's efforts have resulted in some inquiries, however, fielded by the state economic development department. When the department passes a company's needs to specific communities, local economic development personnel respond if appropriate.

"One came in that wanted a 50,000 sq. ft. building. I can't respond to that, or if they want to be near a major airport," Ward explained.

What Silver City would like to attract, she said, is small suppliers to Mexico's maquilas that would use the skills of ex-Phelps Dodge workers. But in the meantime, those skills will soon be put to use in Luna, Hidalgo, and Dona Ana counties with the planned construction of three electric power plants. Although those jobs will only last a few years, it may be just enough to tide Grant County residents over until the mines can open again.

"Phelps Dodge will transfer a few people and some will move, but those who have been here for generations and don't want to leave will take jobs in construction. We want as many of those people to stay around that possibly can," Ward said.

Phelps Dodge spokesman Richard Peterson said, "We find that most of our employees like to remain in the area. Those are excellent jobs and they look forward to returning."

But at the lowest price in decades, copper doesn't pay to be produced. A soft economy has resulted in large inventories of unsold copper. "If people are not buying appliances and autos, and aren't building or remodeling, using copper, then prices are going to sag," Peterson said. "It's important to remember that our properties here in New Mexico still have significant reserves of copper ore. When the economy recovers, those properties will be ramping up production quite quickly"

In the meantime, workers who were laid off from the plants have been eligible for training benefits under NAFTA regulations. Some folks are finishing their bachelors degrees, others are working on a masters. And some are pursuing technical and non-traditional training.

"Western New Mexico University has been stepping up to the plate to get prepared and offer classes that employees want. They have a wonderful attitude. They are asking what do you want and we'll provide it," Ward said. For example, the university is working with Stream to offer workforce training for support center positions.

"We're just all pulling together trying to get through the layoffs," Ward said. She suggested that one effort Silver City residents can make to help their community is to shop locally "It's like conserving water. Until you look at it, you don't realize how much you aren't doing it."

Shopping in the historic downtown area should be a pleasure for both residents and visitors these days. New but "old-fashioned" street lamps grace Main Street and downtown, which is blossoming with art galleries and boutiques.

The town has made significant efforts to attract travelers from Texas and Arizona. Hotels are expected to fill during the top-rated Gila bicycle race and the annual Silver City Blues Festival when, because of Silver City's long-term approach, only the performers will be singing the blues.