JOBS—Providing a Job Is No Panacea

Northeast valley needs more than jobs to make it work When officials at Veratex need seasonal workers, they just holler. A word to the factory floor manager and 50 potential recruits will line up at the company’s Panorama City offices the following day. “One of the beauties of this area is there hasn’t been a problem with the labor pool,” said Dale Talbert, vice president for Veratex, a bedding manufacturer. “We spread the word among the managers on the factory floor, and boom.” The city of Los Angeles wooed employers like Veratex to the Northeast San Fernando Valley a community that also includes Pacoima, Sun Valley, Arleta and the city of San Fernando with promises of a plentiful workforce, tax incentives and price breaks, and those like Veratex regularly draw from the labor well. But behind the ample workforce lies another story. Many Northeast Valley workers lack the skills and resources to fill the jobs that become available and, despite the relative success of city and state economic development efforts in attracting business to this part of the Valley, the region’s unemployment levels hover at just under 10 percent, more than twice the statewide average. Now, as some of these initiatives come up for renewal, there is a nagging feeling that jobs aren’t all that is needed to put the area’s locals to work. “I think that job creation is still something we have to do but, at this point, the balance has shifted somewhat,” said Roberto E. Barragan, president of the Valley Economic Development Center, Inc. “The businesses that have moved into the area are being challenged by (a workforce that lacks) basic skills.” The VEDC last month received approval from the Los Angeles City Council to extend its Microenterprise/Entrepreneur program, a training and consulting service for small business startups that has focused on Pacoima. And the Community Development Department of Los Angeles, which manages the 15-year-old Northeast Valley enterprise zone, a state program that offers tax credits to employers who hire from the local community, is currently applying for a five-year extension. Programs such as these have helped to cut the area’s unemployment rate in half in the past five years, but they have fallen short of bringing any real sense of prosperity to the community. The Northeast Valley holds some 40 percent of the Valley’s population, but only about 25 percent of its jobs, according to a study conducted by the Community Redevelopment Department. And per capita wages average just over $9,000 per year in the Northeast Valley, considerably less than the citywide average annual income of just over $16,000 per year. A dent in unemployment Statistics such as these have Barragan and others wondering if further business development can effectively cut current unemployment levels unless they are accompanied by programs that strike at the other factors keeping locals out of the workforce: inadequate language and computer skills, child care and transportation. “Just because you bring in jobs doesn’t mean you’ll do anything to affect the unemployment rate unless you provide basic training needs,” said Scott Schmitt, government liaison director at Valley Industry and Commerce Association, and the former project manager for economic development with the city of San Fernando Chamber of Commerce. “You need to provide a link to get jobs and people together.” In recent years, hiring incentives offered by the state’s enterprise zone program, energy credits offered by the LADWP, a major industrial development called The Plant, which brought five new, large employers to the area, and other grassroots programs have continually boosted the number of businesses in the region. An estimated 13,000 to 20,000 businesses are currently in operation in the Northeast Valley, many lured to the region by the designation of the area as an enterprise zone in 1986. The Northeast Valley Enterprise Zone, which sprawls along Van Nuys Boulevard from Panorama City on the south, east across Interstate 5 through Pacoima to Hansen Lake, and northwest along San Fernando Road through the city of San Fernando and Sun Valley, has helped attract an average of 125 companies each year for the past three to five years, according to Roland Aranjo, Northeast Valley Enterprise Zone manager for the city’s Community Development Department. In 1998, at least 185 locals were put to work in enterprise zone businesses, providing those companies with state tax savings of $800,000. In 1999, enterprise zone businesses hired 257 local workers for a state tax savings of $980,000. Although CDD officials are still compiling the statistics for 2000, they project that the accounting will show 400 workers hired under the program, amounting to $1.5 million in tax savings for employers. But many of the businesses that settled in the Northeast Valley in recent years have been small, averaging about 25 employees, Aranjo said. Few are the kinds of larger firms that can make a real difference in unemployment levels. Some of those larger employers, like Precision Dynamics Corp., say they do draw heavily from the local workforce for a majority of their jobs. But others say they can’t find the skills and experience they need within the community. “There are jobs available that go unfilled,” said Aranjo. “I don’t know how many companies I’ve met with where they have machines they can’t find people to operate or where customer service jobs go wanting because people don’t speak English.” Jerry Leigh Entertainment Apparel, which moved to Panorama City from downtown L.A. about a year ago, draws on the local labor pool for its seasonal warehouse jobs, but most of its 300-odd employees come from outside the area. “We try to bring in people that have some experience in our business, and there’s not a lot of companies in our business in this area,” said Jeff Silver, chief financial officer for the apparel manufacturer, which draws on technical, production and design talent from all over the city. “So we’re still pulling people from North Orange County and Long Beach and the San Gabriel Valley.” English classes at a premium Employers who require special skills, computer literacy or even English-speaking workers are often hard pressed to find them in the Northeast Valley, with its relentless influx of Latino immigrants and a shortage of resources to help them assimilate. English classes offered through community programs in Pacoima are packed, officials familiar with the area say, and 80 people wait for a seat at one computer training center run by the VEDC. Low graduation rates at local schools don’t help either. “If you’re in the San Fernando high school cluster, there’s a 9-percent chance that your child will graduate from high school,” said Schmitt. “That’s not good enough for the kids, and it creates a situation where you might locate your business in this area, but you have to import employees from Santa Clarita.” One reason Veratex is able to take full advantage of the local workforce is that many of its jobs do not require special experience or even English-language skills. “Our labor force speaks Spanish, and if they don’t speak English, that’s OK,” said Talbert. “And we train most of our people. But even positions such as those at Veratex may be inaccessible to many in the area’s local population who often lack resources for child care or transportation to get to the jobs.