Booming Economy Offers New Challenges

From high-tech engineers to hamburger flippers, filling jobs and retaining employees continues to be among the greatest challenges faced by Loudoun businesses.

With the local economy growing at an unprecedented rate, this should be a good time for doing business. But the very success of the boom may be its most limiting factor.

Loudoun's highly-educated suburban workforce is the envy of many communities across the country, attracting new companies and retailers who want to tap that pool. But based on interviews with many local business owners and personnel managers, the pool may be tapped out.

Loudoun's workforce has grown by more than 50% since 1989, and the county's unemployment rate is at its lowest point since that same year. According to Virginia Employment Commission figures, in 1998 only 1.5% of Loudoun's 75,826 workers were unemployed.

Fred Livingood, Assistant Manager of the VEC's Fairfax office, says Loudoun is experiencing a trickle down effect from growth in the high-tech Rt. 28 corridor and the retail sector that has grown dramatically with the opening of the Leesburg Corner Premium Outlets and the Dulles Town Center regional mall in Sterling. Large companies are attracting workers from existing businesses, leaving those existing businesses struggling to find help.

Loudoun Healthcare traditionally has been among the county's largest employers. Anne Gravely, LHI's Director of Human Resources, says finding people to fill LHI's 1,400 jobs has been her biggest challenge in the two years she has been in that position. She says it is an "across the board" problem, but the greatest difficulty for her is finding nurses and filling support positions such as food service and patient support staff. Loudoun Healthcare recruits through local advertising, and Gravely says a large percentage of new hires comes from referrals and walk-ins.

In addition to the low unemployment rate in Northern Virginia, Gravely attributes the difficulty in hiring and retaining employees to the changing goals of individuals in the workforce. She says more people today are more willing to explore new career opportunities. "The workforce today is absolutely changing," Gravely said. "People are not married to a job for 25 years.

Livingood agrees: "It's an employee's market. You can actually be a little bit picky."

Gravely also chairs the Leesburg Economic Development Commission, which brings new businesses to Leesburg. She says new businesses need to be aware of the challenges employers face in filling jobs.

"I would tell them that the availability of workforce is a concern because we are growing so fast in Leesburg and Loudoun," Gravely said.

She believes high-technology companies are driving economic growth. "High-tech infiltration breeds more jobs for everyone, but the concern here is that we don't have enough people."

A report last year cited a regional shortfall of thousands of qualified technology workers. That face was illustrated recently when a fast-growing American Online laid off workers at its Dulles campus as part of its merger with Netscape. Recruiters for other high-tech firms were lined up to maker offers. "Those people got picked up so fast, I don't think half of them are unemployed." Livingood said.

AOL Senior Vice president for Human Resources, Mark Stavish, says bringing new talent to the region will be key to the growth of businesses like his. Companies have to work closely with local government leaders to help the county maintain its high-quality schools and good quality of life, he said.

"It's a product we have to sell to people." Stavish says. "People have to come here and say 'Wow, this is a place I want to come and raise my family.'"

David Miles of the 21-year-old Leesburg-based Miles LeHane career management services consulting firm says he believes the economy of Loudoun and the rest of Northern Virginia could grow even more rapidly if a solution to the workforce shortage were found.

He says the problem is equally serious for businesses searching for highly educated highly skilled workers, as for those that need unskilled wage labor.

"In this area, you've got a double whammy," Miles said.

He says high-tech companies have trouble finding people despite the high salaries they pay because of the competition. Other industries, such as restaurants and retail shops, have difficulty because the cost of living in Loudoun is too high for many people who work in those fields.

Miles' firm works with companies throughout the United States and internationally. He says there is no area of the country where the workforce shortage is more acute than in Northern Virginia, although Northern California is comparable.

According to Miles, the workforce shortage exists in an atmosphere in which many companies are still downsizing. In face, says Miles, during only one year of the recession of the early 1990s were more American workers laid off than in 1998. However the turnover time between being let go and finding a new job has been cut in half since the early years of this decade.

Just this week, Alcatel Data network's decision to lay off 150 workers from its Ashburn division - the second round of staff cuts in the past six months - barely caused a blip on the unemployment screen.

Preston Wilhelm, Director of the state Workforce Service program, says that recruiting is becoming increasingly stressful for employers statewide. His agency works with high-tech companies and major manufacturers, offering them incentives to bring jobs to the Commonwealth. The Workforce Service program is currently working with more than 40 companies in Northern Virginia, including AOL, Atlantic Coast Airlines and Orbital Sciences Corp.

Leesburg Assistant Town Manager for Economic Development, John Henry King, says he believes retail, hotel/motel and restaurant industry businesses face the greatest challenge in finding employees.

Gill Brooker, the new General Manager of Leesburg Corner Premium Outlets says getting sales help is not easy and that stores at the retail center have had to be creative. He says there are stores at Leesburg Corner that have job openings, and one has as many as three. A listing of jobs is available at the outlet's management office.

Before coming to Leesburg Corner, Brooker worked at an outlet mall in Hagerstown, MD, where the economy is not quite as strong as in Loudoun and stores are able to hire people at lower wages.

Loretta Eaton, who has worked as General Manager of the Roy Rogers restaurant on South King Street in Leesburg for about a year, says finding employees here is more difficult than at the restaurant she managed in Brunswick, MD. She says it is getting harder and has been particularly bad for the past two months. Eaton has been working 70 to 80 hours per week to keep all shifts covered.

She says the company has taken several steps aimed at improving the situation. New hires are paid $7.50 per hour. The company offers college tuition and driver education reimbursement. Eaton also has instituted an employee-of-the-month program, and employees are eligible to receive a $25 savings bond after 90 days of employment. However, she says, nothing has worked.

"This is fast food," she said, "It's very stressful. You come out of here smelling like a grease pit. Why would you want that when you could work in an office or a clothing store?"

When fully staffed, the restaurant employs 18 people. On Monday, seven positions remained open.

Working longer hours is the solution many managers find themselves facing. "That's why you see me here tonight," says Jim Pumphrey at the family-owned Jock's Exxon in Leesburg. He says his gas station has had trouble hiring workers for about a year, since about the time the outlet mall opened.

Another family-owned small business feeling the pinch is Browning Equipment in Purcellville. Jeff Browning says the firm for the first time is having trouble finding technicians to take care of a backlog of service projects.

"This is the time of year when businesses like ours need all the help we can get. It's painful," Browning says. While many skilled mechanics may be lured to higher paying auto service jobs, he says the pool of candidates is smaller than it used to be. "People coming out of high school these days don't tinker with cars. They tinker with computers."

Livingood says most people coming into his office these days aren't without jobs, but they want to look at other employment opportunities the market has to offer. "A lot of people are gainfully employed but are still looking."

- Matthew R. Coughlin, Norman K. Styer, "Leesburg Today" April 28, 1999.