Economic indicators, optimism edge up

Vermont Business Magazine, Aug 01, 2003 by Hedbor, Eloise Roberts

There have been ups and a few downs in the Northeast Kingdom in the past year, but the overall view today seems cautiously optimistic. This is in contrast to a year ago, when several major plant closings left some people wondering if there would be anyone left to turn off the lights and lock the door.

The Northeast Vermont Development Association serves as both a regional planning commission and a regional development corporation for the threecounty area (Essex, Orleans and Caledonia) dubbed the "Northeast Kingdom" by Senator George D Aiken more than half a century ago.

Economic development has always been a challenge in this corner of Vermont. It is far from any major airport, and somewhat off the beaten trail. Unemployment has typically been higher here than in the state at large, but now there are a number of positive trends.

In spite of some high profile job losses, the unemployment rate for Newport in May was 5.8 percent, just one-tenth of a percent higher that for the same month last year, while St Johnsbury posted a nice gain, 4.4 percent for May 2003, compared to 4.8 percent in May 2002. The statewide figure for May 2003 was 3.7 percent, up from 3.4 percent in 2002.

In the past year there have been several positive developments and more are on the horizon, said Mary Paull, economic development coordinator for NVDA (www.nvda.net).

Last year the region was still absorbing the devastating loss of 120 jobs at Ethan Allen Furniture in the Island Pond facility, and the idea of an employee-owned furniture making business was still just a dream.

Now, Chittenden County developer Bobby Miller has "put up a beautiful new building" where about 10 people are already working in the employee-owned Island Pond Woodworkers Alliance, with contracts for carrels for the Middlebury College Library, as well as some projects for Dartmouth, Paull said.

The NVDA is currently in discussions with Ethan Allen Corp about some possible reuse of their old facility, said Steve Patterson, the new NVDA executive director.

"We're looking at it but we're not close to a conclusion yet," he said. He sees some potential that the idle facility could be used to produce products complementary to the big furniture-maker's product fine.

The closing of the Gilman paper plant more than a year ago had put about 100 people out of work, but now Patterson sees a good potential that facility could be back in operation for the production of high end specialty paper within a matter of months,

NVDA is looking for a Community Development Block Grant to help move that project along, and possibly open up about 90 jobs. There is a principal who is interested in operating the plant, Patterson said.

And the region had a "big save" earlier this summer when the owner of Quality Controlled Stitching in St. Johnsbury announced the company was closing and laying off 45 workers. But Marie Bouchard, owner of Wild Things in North Conway, NH, had been buying product from the company for her line that includes high-end outdoor wear and apparel for Navy Seals. She needed the work done and within a month had bought the company, renamed it WT Solutions and by mid-July had 52 people working there.

Quick success stories like this "don't happen as often as we'd like," said Patterson, but this one has a lot of people smiling.

Rather than just playing defense, a lot of people and businesses in the Kingdom now see opportunity to move forward, and position businesses here to grow. One of the faster growing payrolls is that of Vermont Teddy Bear, whose CEO Elisabeth Robert was recently named Vermont Small Businessperson of the Year.

The company is continuing to expand

their production facilities in Newport. It opened the Newport branch with 25 employees, and now has 80 full-time employees with more temporary workers during the busiest times, around holidays, said Paull. "They are such wonderful employees."

Another thriving local business is French-owned MSA Gallet, which manufactures high-tech helmets for the military, firefighters, police and pilots.

"That's a rock-solid company and they are good paying jobs," said Paull.

On the negative side, the Newport Call Center has been downsized, said Paull. Not only is the telemarketing industry changing, in part because of initiatives such as the "do not call" lists, but more and more people are getting information and placing orders on the Internet instead of using the telephone.

"Most of the reps are taking July and August off and they don't know what's going to happen come September," said Paull.

But there is the promise of growth in other places. In the city of Newport, it now appears that the downtown Shaws may be moving into the old Ames store site on Derby Road and there is the potential for new lakeside development at the current Shaws site.

There is some new incubator office space in Newport being offered by Rick Woodward. He recently purchased the old Montgomery Ward building on Main Street in downtown Newport where his graphics arts business, Altyr Imaje, is