While overall U.S. joblessness is down, there are pockets where unemployment may stay high during the next 10 years, creating a situation where workers loosely are termed ``surplus'' by demographers. High unemployment is an attractive element for some firms looking for plentiful workers. But in the minds of consultants, it is a red flag.
Clint Hoch, president of Corplan Inc., a corporate site selection company in West Orange, N.J., said plastics processors ``are leaving California, mostly for environmental and regulatory reasons.''
However, ``Phoenix and Tucson are not the answer, as they have 3 percent unemployment,'' he said.
An employer moving from California ``must go as far as New Mexico, [for example, Las Cru-ces], which has 7.8 percent unemployment - and then only if the employer is willing to cope with a largely non-English-speaking work force,'' Hoch said.
``Fabricators are low-end employers - they have to look at labor surplus areas that will remain surplus areas,'' he said.
Hoch bases his case on a study of 324 metropolitan statistical areas where 85 percent of the American population is concentrated. Projected over the next 10 years, 119 MSA locations, including Alexandria, La.; Hattiesburg, Miss.; Jersey City, N.J.; Houston; Hamilton and Middletown, Ohio; and Tampa, St.Petersburg and Clearwater, Fla., will have an employee surplus.
By comparison, 136 MSAs will have average employment prospects 10 years from now, including Indianapolis; Lima, Akron and Cleveland, Ohio; and Tallahassee, Fla.
What bothers employers most about low education levels?
``They have to provide remedial training,'' Hoch said.
But Dennis Donovan, of site-locating consultants Wadley-Donovan Group in Morristown, N.J., said that non-English-speaking workers in the West make up ``a very good work force.'' And, despite available database information, it is ``hard to determine the quality of the work force at the wage rate you can pay.''
``Customer companies are demanding efficiency from suppliers, which means [fabricators and molders] must maximize capital in [a geographic] area where labor and power costs are relatively low. This frees up cash to partner with customers.''
Donovan noted that the absolute number of Americans of prime working age, 18-34, is less today than in 1980 and will be less again in 2000.
Donovan said there are a maximum of 50 locations in the United States with the kind of labor surplus that will suit the needs of the plastics industry.
``For a plastics manufacturer, there will only be a few places where surpluses will be, [considering] many areas of surplus have nagging low education standards.''