- August 2004 -
Cleveland County Positive and Negative Economic Impact Reports Completed by UNC-Chapel Hill

Results Discussed at Economic Development Council Meeting on August 9, 2004

(Cleveland County, NC) -- The Cleveland County Chamber and University of North Carolina-Chapel Hill are unveiling the results of two studies that measure the negative economic impact of lost jobs as well as the positive economic impact of new industrial investment and job creation in Cleveland County.

The Economic Development Council met at 3 p.m. on Monday, August 9 at the Charles F. Harry Administrative Building in Shelby to hear the results of both reports.  Officials with UNC-Chapel Hill examined a variety of factors relating to the Cleveland County economy.  According to leaders, this is the first report of its kind generated to study the economic impact of job losses in a specific county of the state.

“The meeting provided an opportunity for local citizens and public sector leaders to hear this crucial information and more fully understand what we can do to bring economic prosperity to Cleveland County,” said Chamber President Stuart Gilbert of the reports.  “In addition, the material presented does more to quantify the economic crisis we are in than anything else I have seen.  This is a compelling reason for intensifying our economic development public/private partnership and support.”

Each of the reports utilize IMPLAN software, which measures the multiplier effect of both job losses and gains.  The negative economic impact report measures a variety of elements that led to job losses, and how those losses have financially impacted the local economy.  In addition, the report provides detailed information on how Cleveland County ranks in comparison to other counties in the region as well as to the state average in several areas.

According to Dr. Michael Luger, Professor of Public Policy, Business, and Planning for the Carolina Center for Competitive Economies (C3E) at UNC-Chapel Hill, the Chamber’s proactive response to the economic situation is particularly promising.  “Rather than blaming the problem on free trade or other external factors, the leadership at the Chamber has simply asked ‘what can we do’ to create more and better jobs,” said Luger.  “They have put forward an ambitious program of recruitment and expansion in targeted industries that our analysis shows will indeed restore economic vitality if successful.”

The positive economic impact study examines how the Economic Development Plan of Action would affect the county, assuming the goals for investment and job creation are achieved.  Both reports include direct, indirect, and induced effects on the economy, and not surprisingly, the negative impact study’s results show exponential losses with an estimated 5,552 job-years, over $637.5 million in output, and $175 million in labor income have been lost in Cleveland County due to plant closings and business downsizing between 2001 and 2003.

“The change in demand is caused by the loss of payroll and output in the Cleveland County economy resulting from plant closings and business downsizing,” the report states.  “The implicit assumption in the model is that direct, indirect, and induced losses would not have occurred in the absence of plant closings and business downsizing.”

By the same token, similar benefits are also discussed in the positive economic impact model.  Since February of 2003, the Cleveland County Chamber’s Economic Development division has assisted in the generation of over $75 million in new investment (both existing and new industry projects) and the creation of 750 new jobs.  The positive impact study reviews the Economic Development division’s strategic goal of $500 million in new investment and over 2,500 new jobs over the next several years, and the impact of such investment in the county.

“Various economic challenges require an aggressive response from local leaders,” the report states.  “The leadership of the Cleveland County Chamber is developing an economic strategy to position the county to be competitive in the 21^st century-knowledge economy.” 

Scott Darnell, Senior VP for Economic Development at the Chamber believes the reports provide community leaders with a compelling reason to continue to work as a team with regard to economic development efforts in Cleveland County.  “In order to achieve our $500 million investment goal, we need full support from the private sector,” said Darnell.  “Not only do these reports show that we are on the right track, but that our failures and successes up to this point share a strong correlation.  We are in a better position to capitalize on our strengths and tackle our weaknesses.”

Chamber board chairman David Faunce says now is the time for citizens and businesses to support the efforts of the Chamber.  “Without question, the Cleveland County Chamber is the catalyst for economic development,” said Faunce.  “By supporting the Chamber through a new membership or additional involvement, every business can help our community.  We must increase the job opportunities for the thousands of unemployed and underemployed citizens throughout Cleveland County.”