“West Virginia is poised for success,” Gov. Earl Ray Tomblin opened his State of the State address last January. Indeed, as with most states, it was hit hard by the recession, but in many ways, “the economy is very good,” observed Steve Adams, editor-in-chief of the not-for-profit West Virginia Watchdog. The state boasts a AAA bond rating. It has a budget surplus. Exports reached a record $6.4 billion in 2010, up 33 percent over the previous year. It has attracted new businesses to the state that have invested approximately $1 billion dollars over the past year. “We’ve come out (of the recession) okay in many ways,” Adams told MillionaireCorner.com.
Not that West Virginia doesn’t have its share of challenges. Its unemployment is at 8.8 percent, 30th in the nation. A recent report by the Pew center on the States listed West Virginia and Illinois as having the worst funded public pension plans in the nation. The state’s large manufacturing sector was particularly impacted. About 28 percent of West Virginia’s income is from government assistance, more than any other state in the country.
There are other dire, “worst case” scenarios. CNN recently reported that West Virginia’s defining coal industry is facing increased competition from other regions and heightened regulatory scrutiny. ‘The federal government predicts coal production in Central Appalachia—which includes West Virginia’s southern coal fields, will decline 40 percent in the next five years, resulting in the loss of thousands of jobs there,” according to CNN.
While mining coal is decreasing, Adam said, much of that has to do with the federal government’s regulatory process. “The EPA wants to do one thing, and Congress is trying to do something else. It’s an uncertain environment, and we don’t want to put a lot of money into operations without knowing what regulatory framework with which we are going to be working.”
The 2010 Census figures show that over the past decade, the population has shifted out of these southern counties and the Northern Panhandle, and into north-central counties and the Eastern Panhandle. “It’s not a real diversified economy,” Adams observed of this region. “Either you mine coal or you’re working in some sort of service industry. People are getting out.”
But there are several positive developments to buoy West Virginia’s spirits. In April, Amazon.com announced plans to expand its customer service center in Huntington with a new 70,000-square-foot building. The facility is estimated to create 200 new full-time jobs by the end of 2014. Construction also recently began on a 1.3-million-square-foot Macy’s, Inc. online fulfillment center in Martinsburg. When fully operational, the $150 million facility will create 1,200 full-and part-time jobs and 700 seasonal jobs in Berkeley County.
While the popular perception of West Virginia remains “coal,” the state is working to redefine itself. “It’s time to diversify the economy to bring other kinds of jobs here,” Adams said. He sees “tremendous opportunity” in the Marcellus Shale, a large natural gas field in the form of shale rock. “We could have a booming economy in the long term when you think of the companies and manufacturers that would be coming to the state,” Adams said. “At one point, West Virginia was a very important part of this nation’s chemical industry. It hasn’t been that way for several years, and the Marcellus Shale stands to bring us back from that.”