Greenville: Moving past Electrolux

Kathy Jo VanderLaan steered her white convertible around a curve in the road. A grassy lot appeared on the right, behind a chain-link fence.

"That's the Electrolux field," VanderLaan said, gesturing out the passenger-side window at the spot where a refrigerator factory once stood.

For a decade, that empty lot has been used to paint Greenville as an example of a failed American company town, a place that had so many jobs in one economic basket that a single factory closure put an estimated 5,000 people out of work between the main employer and its suppliers.

This year marks the 10th since Swedish appliance manufacturer AB Electrolux shuttered its refrigerator plant in Greenville and moved operations to Mexico. Close to 2,700 jobs evaporated at Electrolux alone — about a third of the city's population, though some of the workers lived in surrounding communities.

The story of Electrolux and Greenville is by now so well-known that VanderLaan and others here wish people would stop asking about it.

"I still get the Electrolux thing: 'Oh, you poor people, you've rolled up the sidewalks,' " said VanderLaan, Montcalm County's business development coordinator, who works for Grand Rapids-based economic development agency The Right Place Inc.

"I hope you noticed driving in that we didn't fold up our sidewalks or give up."

The days of Electrolux likely are over in Greenville. The city may never again have a single company be its dominant employer, partly by design.

Yet despite the challenge of diversifying a small-town economy long known for its appliance-making prowess, there are signs that Greenville, a city of roughly 8,400 people northeast of Grand Rapids, is learning from its past.

These days, the city is marketing itself as part of the larger West Michigan region, hoping that more resources for business attraction will lead to more deals. When Montcalm County wasn't yet ready to join up with The Right Place, Greenville signed the first contract for services in the summer of 2014; the county followed about six months later.

Greenville's largest employers now have several hundred employees each, as opposed to several thousand. Business retention specialists like VanderLaan help existing manufacturers, including Electrolux's former suppliers, enter new product markets so they're not tied to the boom and bust of a single industry.

And in a city where just two out of 10 people have at least a bachelor's degree, the local chamber of commerce and Montcalm Community College are attempting to get ahead of the looming skilled trades workforce shortage by taking high school students on tours of local factories and working with manufacturers to rewrite curricula and train students on the same robotics technology the employers use.

"Talk about all eggs in one basket? We're not going to do that again," VanderLaan said. "We're not that reliant on that number of employees anymore, and we have been helping companies grow and recruiting companies," she said. "We have been very, very targeted."

At its peak, Electrolux employed as many as 8,000 people in Greenville, VanderLaan said. Shortly before the manufacturer decided to close the plant, it had 3,800 employees on the payroll. That number had shrunk to 2,700 by the time the plant closed.

Today, in contrast, Montcalm County's largest manufacturer is Southfield-based automotive supplier Federal-Mogul Corp.; it employs 375 at a powertrain bearings plant in Greenville.

Manufacturing remains one of the city's largest industries, but health care now leads the pack. Montcalm County's largest employer is Grand Rapids-based Spectrum Health, with 850 people working at United Memorial Hospital in Greenville and Kelsey Hospital in Lakeview, according to 2014 data published by the county planning commission.
These days, a company the size of Electrolux is "not the main target," said Rob Spohr, student and academic affairs vice president at Montcalm Community College and president of theMontcalm Economic Alliance, the county's economic development agency.

That's not to say the city wouldn't entertain an offer from a company looking for a sizable workforce. But, he said, the community today is more interested in long-term economic sustainability than short-term gains — the marathon approach to economic development, not the sprint.

After Electrolux closed, the city's tide appeared to turn when solar panel manufacturer United Solar Ovonic LLC announced plans in 2006 for six facilities and 1,200 jobs, according to The Daily News in Greenville. Uni-Solar's parent company, Energy Conversion Devices, later went bankrupt; it had employed just 474 at its peak. Its plants closed in 2012.

Last year, Dicastal North America Inc., a subsidiary of Chinese aluminum wheel manufacturerCitic Dicastal Wheel Manufacturing Co. Ltd., opened its first North American facility in the city inside the former United Solar buildings. Twenty-seven communities in seven states were vying for the $140 million project, VanderLaan said.

The company currently employs 69 people, with plans for nearly 300 when fully operational.

Since June 2014, when Greenville signed the first contract with The Right Place in Montcalm County, the expanded regional effort led to $141.1 million in new investment, $13.3 million in new payroll expenses and 343 new jobs, data show. Those figures include Dicastal's project.

The Montcalm Economic Alliance signed a $125,000 annual contract with The Right Place in early 2015. VanderLaan, a former Greenville chamber executive, was hired.

"The idea of us being this small area, small county, and thinking we can get attention from large companies who are moving into an area is plain silly," Spohr said. "We're attracting people to the region. And then it becomes, 'OK, West Michigan. We can sell West Michigan because it's a great place to live. Now where's the best for your company?'

"Whether it's Grand Rapids or Ionia or Montcalm or Newaygo, companies coming into the area make us all better."
While recruiting companies is part of her job, VanderLaan said retention is her primary focus.

Financing often is a large part of corporate retention efforts. Incentives, though, aren't always successful. Case in point: Local and state officials floated a $42.8 million annual incentive package to convince Electrolux to stay in Greenville, but corporate leaders rejected the plan in favor of a roughly $1.50 hourly wage in Ciudad Juarez that would save the company $81 million per year, The Associated Press reported when the plant closed in March 2006.

Greenville's City Council approved a $45 million incentive deal for United Solar, including funding for job training and infrastructure, according to The Daily News. Yet that didn't stop the plant from closing.

VanderLaan said the most important part of the job is building relationships and trust with local employers. She helps companies connect to vendors and dip their toes into export markets, and intervenes when alerted to financial stress or news of a company takeover.

"If you're not in there talking to them or listening or doing those things," Spohr said, "a lot of times by the time you find out, it's too late."

Greenville's economic rebound also will depend on how successfully it can supply local manufacturers with skilled talent.

An aging workforce and growing skills gap have been significant discussion topics for companies for several years, said Spohr, who is leading the community college's Greenville campus through its third expansion in two years.

The college received $1.7 million through a state grant — including more than $430,000 in matching funds from the college — to add a machine shop and lab space for welding, robotics and advanced manufacturing training. Spohr said the college is training students on the same robots used by local companies, including Grand Rapids-based furniture manufacturer Steelcase Inc.

There's reason to be optimistic: The number of apprentices to local companies has grown from just a handful during the recession to 155 today, Spohr said.

Fewer than 20 percent of Greenville residents — 19.8 percent — had at least a bachelor's degree as of 2014, compared with 26.4 percent of Michigan residents, according to Census data from 2014. Montcalm County had even fewer, with just 13.4 percent of county residents holding a four-year degree.

"We're trying to change the mindset of manufacturing, that it is a very viable career," said Gae Donovan-Wolfe, executive director of the Greenville Area Chamber of Commerce. "Manufacturing is not dirty anymore. It is skilled. You need to know what you're doing.

"Building the awareness is what's important," she added. "Not only the teachers, but just building some hope for the students who … already feel they're not college bound."

In October, a group including Donovan-Wolfe and VanderLaan took between 40 and 50 high school students on a tour of three manufacturing plants. They followed it up by taking Greenville school administrators and teachers on a similar tour, with the thinking that some of the educators might tailor their teaching styles to include more of the vocabulary used on the plant floor.

The chamber in 2014 released two videos promoting skilled trades careers to elementary and older students.

The videos cost $15,000 and were funded by a local foundation grant and contributions from manufacturers, Donovan-Wolfe said. Grand Rapids-based Soapbox Pictures produced the clips.

"Since the mid-(1990s), I haven't seen as much conversation going on between our employers and education," VanderLaan said. "Now it's just out of the box. It's very cool."

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Mon, 04/11/2016 - 1:13pm
Yet, the state basically let them off ZElectrolux hook when to came to cleaning up the contamination.
Steve Schofield
Tue, 04/12/2016 - 12:52am
Nice article. I commend our city leaders past and present for the challenges they've faced and continued pressure. Hats off, nice article!
Larry Moss
Tue, 04/12/2016 - 3:10pm
Thank you to Bridge Magazine for showing Greenville in a positive light. We've had ten years of the other kind, as the article points out. Diversification is truly the key. We don't need one employer with 8,000 employees, or 3,500 employees, or 2,700 employees. We need twenty companies with 400 workers, or even more smaller ones. We need a commercial bakery, a battery manufacturer, a wind turbine plant, a paper mill, a textile warehouse. When one runs into trouble, the rest can still prosper. The Right Place is taking us where we need to go and is one of the best investments the community has made.
Fri, 04/22/2016 - 11:48am
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