`Diversification' is oil-patch rallying cry. Retraining programs help some workers, but need exceeds supply
Lake Charles, La.
Every day Ray Meade puts 168 miles on his car getting to and from his job as a sheet-metal worker at Boeing's new aviation maintenance center here. But the Louisiana native says the $7-an-hour job is well worth the commute. ``There's no way I'd ever go back to the oil field,'' says Mr. Meade, who until late 1985 was a parts dispatcher for an offshore-rig servicing company. ``It's too unstable,'' he says, noting he was out of work for 18 months before landing his new job.
The Boeing facility opened here last December amid much fanfare. Lake Charles, heavily dominated by the oil and gas industry, had seen unemployment soar above 20 percent - it's down to just under 13 percent today - and Louisiana had surpassed West Virginia with the highest unemployment rate in the United States.
Boeing employs about 2,000 people at the facility, where KC-135s undergo maintenance on the former Chenault Air Force Base. Many of those workers were from the depressed oil industry.
The project is an important example of how industry and government can work together to create new opportunities. The state agreed to build the facility, for $37.5 million, and lease it to Boeing. The community also chipped in $5 million. In addition, much of the worker retraining is being done with funding from the federal Joint Training Partnership Act (JTPA).
While the facility is important to Lake Charles, it makes only a tiny contribution to Louisiana's efforts to diversify its economy away from a heavy dependence on the petrochemical industry.
``The state's [investment] was a good decision, but it's not something that will be felt statewide,'' says Timothy Ryan, director of the Center for Economic and Business Research at the University of New Orleans.
Dr. Ryan says a successful bid by Martin-Marietta in New Orleans for part of the NASA space-station project would be much more important to the state. ``That project ... would put us in the forefront of technology,'' he says.
In addition, the Boeing project is not expected to create any rush of spinoff jobs, since it involves only maintenance and repair. ``Until there's actually some manufacturing involved, [Boeing] won't have too much effect on a local labor force of 77,000,'' says Charles Boudreaux, manager of the state Department of Labor's Lake Charles regional office.
Most of the new Boeing employees appear, like Meade, to consider their jobs a new start, although some grumble about wages that for most are lower than their previous ones.
``I'd like to think I could make a future out of it,'' says Anthony Roy, ``but I was making $8.50 [roughnecking], and here I'm at five bucks. Right now it's worth it, but I'm afraid I couldn't make it too much longer.''
Yet with the number of jobs in many sectors continuing to decline, and wages in many others being reduced, most workers in the region haven't the luxury to complain. Adjusting to the economic shift is difficult, but for many who are motivated, or have good basic skills, there are opportunities.
Last year Houstonian Keith Brossett lost his job in the metallurgical lab of US Steel. But he was determined not to sink into ``a ruined life,'' and that determination, plus some guidance from his union, led him to an aptitude assessment program for dislocated workers.
After some courses paid for by JTPA, Mr. Brossett is now an emergency medical technician, and he is continuing his education to become a registered nurse. ``I used to make $40,000 a year, and I've taken about a 60 percent pay cut,'' he says. ``But I have a greater sense of satisfaction in what I do now.''
In Oklahoma City, the state is about to embark on a first-of-a-kind program to ``retool'' laid-off oil field geologists for work in hydrology, where opportunities in such areas as ground-water use and contamination are expanding.
``We probably have 1,500 geologists in this city alone,'' says Bill Phillips, superintendent of the state's vocational-technical program in Oklahoma City, ``and a considerable percentage are not working as they used to.''
In Midland, Texas, former oil-field workers are helping mentally handicapped people in a six-month training program through the state's Department of Mental Health and Mental Retardation. Possible areas of employment include counseling or parole work.
Ben Porter was making $112 a day in the oil field, and now doesn't make ``one red cent'' in the mental-health training program. But he says the program has ``opened up new horizons for me,'' and also helped him cope with long-term unemployment.
Yet the dollars to support such programs are limited, and demand is sometimes overwhelming. In Oklahoma, where the state increased technical training appropriations in an otherwise rock-bottom budget, training programs are overflowing.
``We're adding our fourth campus now,'' says Oklahoma City's Dr. Phillips, ``but I have no doubt that once we get the last nail in, it'll be full.''
Manuel Zamora, regional coordinator of the AFL-CIO's Human Resources Development Institute in Houston, says the number of Houston workers getting retraining is ``a drop in the bucket'' compared to the overwhelming need.
This year the Houston-Galveston area was allotted $3.4 million through JTPA for displaced-worker retraining, but according to Mr. Zamora that will only help about 2,200 people.
Some workers hoping to remain in the oil industry are taking advantage of the slow times to improve skills. The Petroleum Extension Service of the University of Texas is offering courses in computerization and digital electronics that reflect the oil industry's move to greater automation.
In the long run, while such programs will help individuals through hard economic times, they won't solve the energy states' lag behind other regions of the country. The region's rallying cry has been ``economic diversification.''
But as the University of New Orlean's Ryan notes, steps other than subsidizing industries to locate here will have to be taken.
``We need to reform our tax and fiscal structures,'' he says, adding that such moves will help reform the state's and region's image and enhance its business attractiveness.
Louisiana is beginning to move in the right direction, Ryan says. And Texas, after a record increase in sales and business taxes this year, has created a commission on taxation that could lead to a general overhaul of the state's tax policy.
Education and other services that prepare the next generation of skilled and adaptable workers will also have to reap greater attention than they have historically.
In the meantime, people in Texas, Oklahoma, and Louisiana who have oil in their blood and can't imagine the landscape without squeaking pump jacks or citylike refineries, or the Gulf horizon without offshore rigs, have nothing to fear. The industry may be shrinking, but it is not going away, and it will continue to be a source of wealth and employment in this part of the country.
In Odessa, Texas, Winston Urpani has a new job working with computers after being laid off in April of last year with an oil-field service company. Mr. Urpani says it's nice to have a job that feels ``high-tech.''
Recently he was using computerized specifications to build a cannon plug for a turbine control. And where might such plugs be used? ``Well, for pumping water - or,'' he adds with a grin, ``for oil and gas. That's really all there is in this area.''
Last of three articles. Previous articles appeared on Monday and Tuesday.