View and Download the Chmura study.
LEBANON, VA – December 14, 2018 – Celebrating its 30th anniversary, the Virginia Coalfield Economic Development Authority (VCEDA) has released the results of a study showing the total annual economic impact of VCEDA is estimated to be $6.9 billion in 2018 supporting 37,311 jobs in Southwest Virginia. The study also illustrates efforts by VCEDA “have greatly accelerated diversification in the region,” and that without the jobs attracted to the region by VCEDA, the region’s unemployment rate would be more than three times higher.
The report prepared by Chmura Economics & Analytics of Richmond, Va., notes all eight localities covered by VCEDA have benefited from VCEDA’s job creation efforts. The report documents that since VCEDA’s creation in 1988, more than 23,000 direct jobs have been attracted to the region, which includes the counties of Buchanan, Dickenson, Lee, Russell, Scott, Tazewell and Wise counties and the City of Norton in Virginia.
In 2018, VCEDA reported 41 new projects and expansions in the region, the most in VCEDA’s 30-year history. Those projects are projected to create 1,008 full-time and part-time jobs and private investment of nearly $10 million. In 2018, VCEDA also approved 10 loans and 35 grants, the most in any year of the organization’s 30 years in existence, according to Jonathan Belcher, VCEDA’s executive director/general counsel. The total amount of funding approved in 2018 was more than $15 million. Projects were announced and funding was approved this year in every county and city in the VCEDA region.
The results of the Chmura study were presented during a 30th anniversary celebration held following VCEDA’s December 13 board meeting. At that event, the region’s state legislators were presented with certificates noting their “outstanding service and genuine concern for the people of Southwest Virginia and the Coalfield Region in their tireless efforts in support of the region and its economic development.” These were awarded to state senators Bill Carrico and Ben Chafin and state delegates Terry Kilgore, Will Morefield, Israel O’Quinn and Todd Pillion.
Special guests at the 30th anniversary event included former state delegate Ford Quillen, who was recognized for his role in the founding of VCEDA in 1988, and Charles Yates, VCEDA’s first executive director.
The board also elected the following officers for 2019 at the December board meeting: J.P. Richardson, chairman; Rick Axthelm, vice chairman; Esther Bolling, treasurer, and Frank Underwood, secretary.
“The success that VCEDA has enjoyed would not have been possible without a team approach and without the support of a whole host of allies including elected officials, economic developers, educational institutions, localities, industrial development authorities, private businesses including the coal and natural gas industries, and many, many others,” Belcher said, “and that has been and will continue to be the key to positive progress in our region – everyone working together for the betterment of the coalfield region of Southwest Virginia.”
VCEDA is a unique regional economic development agency formed by the Virginia General Assembly in 1988 to help enhance and diversify the economy of the seven-county, one-city coalfield area of Southwest Virginia. VCEDA is funded primarily by taxes paid by the coal and natural gas industry in the region.
Highlights from the Chmura study released Thursday include:
- In terms of direct impact, the total revenue (or sales) of all businesses attracted by VCEDA is estimated to be $5.1 billion, with associated direct employment of 23,052 in 2018.
- An additional indirect impact of $1.2 billion and 8,022 jobs benefit other Southwest Virginia businesses that support VCEDA-attracted businesses.
- The number of jobs supported from the induced impact is estimated to be 6,238 with associated annual spending of $685.1 million.
In addition to the economic impact generated by VCEDA in terms of total revenue and jobs, the Chmura study also analyzed the effect of VCEDA in enhancing economic diversity, reducing unemployment, and lowering the cost of government-assistance programs in the VCEDA region.
“In addition to supporting job creation in Southwest Virginia, VCEDA also helps diversify the regional economy, which lays the foundation for sustained economic growth in the future,” the Chmura study notes. “Challenged with the declining coal mining industry, VCEDA has attracted jobs in a wide range of advanced manufacturing and professional and business industries … 11,865 of all VCEDA-attracted jobs were in manufacturing, and 7,700 were in professional and business services (such as call centers). Tourism industries also grew based on support from VCEDA with many jobs generated in the trade and leisure sectors. Those efforts have reduced the regional economic reliance on the coal industry.”
“Chmura’s analysis shows that VCEDA has helped diversify the regional economy significantly since 1990. In 2018, the diversity index of the region was 32.8%, which is a dramatic improvement from 12.6% in 1990,” the study notes “Diversity in the regional economy has increased since VCEDA was established. The pace of diversification has accelerated since 2012. If jobs related to VCEDA were removed, however, the diversity index in 2018 would fall to 25.4%. This number is still higher than the diversity measure in the 1990s and 2000s, showing that the regional economy is diversifying even without VCEDA-attracted jobs. Even so, the efforts by VCEDA have greatly accelerated diversification in the region.”
The Chmura study also found “VCEDA has made considerable contributions in reducing the unemployment rate in the region,” which based on the first eight months of data in 2018 was 5.0%. The study states: “Without jobs attracted to the region by VCEDA, the region’s unemployment rate would be much higher. For example, the estimate would put the 2018 unemployment rate at 15.3%, when jobs related to VCEDA were removed and added to regional unemployment. The effect of VCEDA in reducing regional unemployment became more significant especially after the recession of 2007-09. Without VCEDA-attracted jobs, the unemployment rate of the region would stay in the double digits from 2010 to 2018. However, the actual regional unemployment rate declined sharply, from 9.0% in 2010 to 5.0% in 2018.”