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Biting the Bullet, Connecticut Looks Beyond Defense Industries

WHEN the whistle blows for the 3 p.m. shift change, thousands of workers stream out of the gates of Electric Boat, the nation's largest submarine manufacturer; its huge complex sits on a small hill overlooking Connecticut's Thames River.With a work force here of about 17,000, Electric Boat - plus a United States Navy submarine base, a Navy research laboratory, and numerous other defense firms, factories, and contractors within several miles of each other - make southeastern Connecticut one of the most defense-dependent regions in the US. It is also expected to take the worst hit from continuing defense cuts. "The potential impact of peace in the world is going to be devastating for this area," says Dick Guggenheim, transportation planner at the Southeastern Connecticut Regional Planning Agency in Norwich. New London County, which covers most of southeastern Connecticut, is diverse. Its 21 towns range from industrial centers to picturesque seaside communities, rural havens, and small urban hubs. It has wealthy neighborhoods and pockets of poverty. The county's common denominator is defense: Twenty-five percent of its 145,000 labor force works in the industry, and the area has one of the highest incomes per capita from defense contracts in the US; it was $9,785 in 1989. But, according to a study done this year by Regional Economic Models Inc. of Amherst, Mass., 18,000 people are expected to lose their jobs by 1996. Electric Boat, which also has several thousand employees at its Quonset Point shipyard in neighboring Rhode Island, expects to cut its total work force in half by 1996 because the Navy has decided to build fewer submarines. "Our business base is diminishing," says Neil Ruenzel, director of communications. "The best we can hope for is one new contract per year to build a sub." The company, a division of General Dynamics Corporation, is building the first Seawolf submarine and has won a second contract. At the Navy submarine base downriver from Electric Boat, 3,000 workers are expected to lose their jobs by 1992. In addition, the Navy is proposing to consolidate the New London-based Naval Underwater Systems Center with a laboratory in Newport, R.I. Other defense-related companies plan to slice their work forces substantially. "I see this area turning into a ghost town four or five years from now," says Darren McNair, who has worked at Electric Boat for two years. The loss of defense jobs is just one casualty in a region whose economy is already smarting from the recession and a soft real estate market. Businesses, schools, and nondefense industries will also feel the impact. Community and business leaders are taking steps to address the situation. Last November, some individuals and community groups formed the Southeastern Connecticut Economic Development Coalition, which is planning strategies on what can be done to improve infrastructure, attract new industry, retrain people, and work with available resources. Other organizations are involved in regional efforts. A mayor's and selectmen's group meets once or twice a month. Several local chambers of commerce convene regularly. Smaller associations are also trying to work on solutions. Both state and federal government are providing some funding for the economic development process. But some individuals question whether there is enough coordination and communication among the groups. "It's hard because everything is new, and not all the groups are aware of each other," says Christopher Emerson, senior pastor at the Mystic Congregational Church. "Everybody is thinking right, but our challenge is, we have a lot of catching-up to do because of so many years in which we were not as regionally foresighted as we needed to be." "We've been crying wolf for 25 or 28 years," says Mr. Guggenheim. "We have said we're 30 percent to 40 percent defense-dependent; we've got to diversify the economy." Thomas McCune, chairman of the Southeastern Connecticut Economic Development Coalition, is optimistic the region can restructure itself. "We're not going to replace the defense-related jobs overnight," he says. "But the fact that more and more people want to get involved is [an indication] that we can be successful."