AFP InDepth | Examining Landes’ record on jobs

The 2009 state elections are going to be about the economy, for obvious reasons.

Steve Landes thinks this is to his benefit.

“The NFIB, the National Federation of Independent Businesses, who represent small businesses, they’re supporting me, they’re not supporting you,” said Landes, who works in the marketing and public-relations department at the DuPont Community Credit Union, at last week’s 25th District debate in Waynesboro, wagging his finger at Democratic opponent Greg Marrow, a Rockingham County optometrist and small-business owner.

“That tells me something right there, that the small-business community is supporting me because of my business record. I’m a businessperson, and I’ve worked hard to try to provide opportunities for people with jobs, and more importantly, grow those jobs,” the Republican incumbent said, defending himself from the criticisms from Marrow on his record on job issues, which Marrow says is weak.

Put aside the NFIB’s Republican leanings in considering the relative merits of Landes on jobs. The conservative organization has endorsed the Republican Party ticket in the statewide elections, and though it doesn’t make public its list of endorsed candidates, making that information available only to NFIB members, what we’ve been able to find from press releases from ’09 candidates from the past several weeks indicates a straight GOP party-line to its endorsements this year.

Landes is selling himself to 25th District voters as a “businessperson,” as he described himself at the debate last week, who has “worked hard” on the Valley jobs front in his time in Richmond.

The Landes record on jobs is thus worth a close examination.

It does have pluses – well, plus, singular – and minuses. The plus comes in the area of something that Landes highlighted in the debate last week regarding his work on the effort to bring SRI International to the Shenandoah Valley. It is expected that SRI, a research-and-development firm that was a key player in the development of the Silicon Valley in California, will spur similar activity in the Shenandoah Valley as it spins off its research into commercially-viable applications, though the going has been slow at the outset now almost three years past the big December 2006 announcement about its new location north of Harrisonburg.

Credit for SRI doesn’t go to Landes specifically or even generally. The first pats on the back go to the Shenandoah Valley Partnership and James Madison University, with the Virginia Economic Development Partnership, former Gov. Mark Warner and current Gov. Tim Kaine and an array of state senators and state delegates included in the work group. Landes’ main role was to join other local legislators in supporting the provision of state incentives that helped land SRI here in the Valley.

He played an entirely different role in the effort of local and state leaders to bring Toyota and 2,000 jobs to the Valley earlier in 2006.

“The thing where at least some of the folks who support the efforts to try to not see the megasite occur, folks like myself, they’re not opposed to industry or business, but it’s the scope, and it’s the appropriate types of businesses that you’d like to see, that don’t detract from existing businesses, that don’t overpower existing resources and infrastructure, and that are part of the pattern of smaller- to medium-sized organizations and businesses that have been recruited in,” Landes said in a 2006 interview with the AFP.

“There are some people who would not like to see any industry or business come in – and I think that’s a legitimate philosophy, if that’s what you believe,” Landes said in the interview.

With Landes joining the opposition, the Toyota effort fell through in June 2006, and the automaker moved on. At the time, it didn’t seem like that big a loss, given that unemployment in the 25th was 2.7 percent in Rockingham County, 2.8 percent in Augusta County and 3.5 percent in Waynesboro. Three years later unemployment is 5.7 percent in Rockingham, 6.3 percent in Augusta and 8.7 percent in Waynesboro.

Landes responds to criticisms of his record on jobs that from his first year in the General Assembly in 1996 to today that several thousand new jobs have been created in the 25th, and on that technical point he is correct. According to figures from the Virginia Employment Commission, Augusta County has seen net job growth from 1996 to 2008 of 3,509 jobs, and Rockingham County has added 4,190 jobs to its jobs base. Waynesboro has seen a slight decrease of 470 jobs over the period, but still overall we’re talking about growth of 12.5 percent regionwide in the period.

The weak point in the argument comes in the area of what has happened to our manufacturing sector from 1996 to 2008. The word hemorrhaging comes to mind when you look at the numbers. Waynesboro, once the jewel of the Western Virginia manufacturing economy, has lost 51 percent of its manufacturing-employment base since 1996, down from 4,016 manufacturing jobs that year to 1,978 manufacturing jobs at the end of 2008, according to the VEC.

The drop in Rockingham has been only half as precipitous – from 10,398 manufacturing jobs in 1996 to 7,747 in 2008, a 25 percent decrease. Augusta has seen its manufacturing base erode by 9 percent, from 6,539 jobs in 1996 to 5,942 jobs in 2008.

Manufacturing jobs locally pay anywhere from 125 to 140 percent what the average job pays, so the sum effect of the job loss the past dozen years is that we’ve lost a good bit in terms of community wealth even as we’ve replaced, as Landes lauds in his defense of his record, the jobs lost to manufacturing, with jobs in lower-paying industries such as the retail and food-service sectors.

“I’ve also worked with small businesses on legislation that will help them. That’s where the job growth is. It’s not in the big businesses anymore. Job growth is in the small-business sector,” Landes continued the defense of his record in last week’s debate, though this would upon further examination seem to be the weakest part of his defense, pushing his work in the small-business arena, given his track record as the executive director of the now-defunct NewBiz Virginia small-business incubator.

Landes was the incubator’s executive director for more than five years before resigning in February 2006 at the end of a tumultuous final year at the helm of the sinking ship, according to an investigation by our sister publication, The New Dominion Magazine.

The concerns noted by the president of the incubator’s board of directors in an August 2005 e-mail were direct: that while Landes put in 30 hours a week running NewBiz Virginia, “it’s hard to determine what activities are taking most of your time,” with a “consistent concern” being the perception that “not much seems to happen, and often that which is reported appears to be completed by the office manager.”

Other concerns expressed included “the perception that your lack of a strong business background may create a bit of a credibility gap for some potential tenants.” “There is also the perception that you do not seem to have a sense of urgency as it relates to bringing in new tenants or finding supplemental funding sources.”

Landes’ response to the e-mail was telling. “The fact of the matter is that I don’t feel the board has given me any credit for doing anything right over the 5 years that I’ve been here,” Landes wrote.

In September 2005, according to board-meeting minutes, the board of NewBiz held a strategic planning meeting to discuss its funding dilemma that went over details of a potential partnership with the Greater Augusta Regional Chamber of Commerce that also included discussion of the launch of a $60,000 capital campaign to provide cash to keep the incubator running.

A Dec. 22, 2005, memo to Landes explained that if the capital campaign fell short of its $60,000 goal the board would not be able to continue funding the executive-director position beyond Feb. 28, 2006. On Feb. 13, 2006, Landes submitted a letter of resignation effective Feb. 28, 2006. The board of directors was already well into the process of shutting down operations at the incubator by that point in time.

 

– Story by Chris Graham

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