Kemp plant closing reflects shift Loss of lucrative jobs is part of realignment in a weak economy

C. M.

Manufacturing base fading

Low-wage industries in county have grown by 20% since 1990

April 26, 1996|By Scott Wilson | Scott Wilson,SUN STAFF

Anne Arundel County economic development officials were surprised this week when C. M. Kemp Manufacturing Co. announced it would soon close its Glen Burnie plant. In many ways, they shouldn't have been.

Another casualty of consolidation, the industrial-dryer maker will shut down by year's end, eliminating 99 high-paying manufacturing jobs and continuing a rapid realignment of the county's listless economy.

Since 1990, Anne Arundel has lost 28 percent of its manufacturing base, including half the most lucrative jobs in electronics businesses. In all, the county lost 10 percent of its jobs paying more than $40,000 a year during the period. Meanwhile, the low-wage sector -- paying less than $20,000 annually, primarily retail and service jobs -- swelled by 20 percent.

"What's happening is a fundamental shift in the income base," said Robert A. Riva, a research economist at the Regional Economic Studies Institute at Towson State University. "The county has seen incredible growth in low-wage industries."

Economists say the changes mean Anne Arundel will be a less prosperous place in the coming years as $496-a-week service jobs replace manufacturing positions that pay twice as much on average.

The changing work force translates into slim revenues, say county officials, who are scheduled to unveil next year's budget Wednesday. Executive John G. Gary's administration has refused pay raises for 3,500 employees, proposed pension reforms and postponed new school construction as a result.

Twenty five years ago, county income-tax revenues were growing annually by 20.5 percent; last year, they increased 4.5 percent. Annual increases in the county's taxable property value have shrunk from 10.7 percent in the 1970s to last year's 2.7

percent. The shift means less money for schools, police and potholes.

"We're concerned about the employment numbers," said John R. Hammond, the county budget officer. "They trace directly to income taxes and, in other ways, property taxes."

The economic churn is happening around the state but not at the rate in Anne Arundel, Baltimore and Baltimore County, which among them contain more than 50 percent of Maryland's manufacturing jobs.

Outside the three jurisdictions, Mr. Riva said, manufacturing employment is growing by roughly 1 percent a year. At a recent regional economics conference, he used Anne Arundel as the prime example of counties hit hard by the decline in manufacturing.

More focus on services

"Our economy is focusing more and more on service and less and less on bending metal," said Rosemary Duggins, the Anne Arundel Economic Development Corp.'s marketing director.

For 35 years, C. M. Kemp produced dryers at the 6-acre site in the 7200 block of Baltimore-Annapolis Blvd. And while the loss of 99 jobs doesn't compare to the 7,000 workers Linthicum-based Westinghouse Electronic Systems Group shed in eight years, economic development officials say the shutdown is substantial. (Northrop-Grumman Corp. bought the Westinghouse division last year.)

Anne Arundel's economy is driven by small business. Only 1.7 percent of the county's 165,290-person labor force is employed by companies with more than 100 workers. Economic development officials consider C. M. Kemp "a major employer," Ms. Duggins said.

"Of course, we hate to lose any jobs," she said.

Ms. Duggins said she will market the building immediately, directly pitching to brokers or executives its size and location near Baltimore-Washington International Airport.

In recent years, economic development officials have had success filling industrial parks around the airport. Specifically, Ms. Duggins said printing and communication concerns -- both fields offering employees good pay -- have been arriving in the county. Cadmus Journal Services, which publishes medical journals, French/Bray Inc. and MCI all have substantial operations.

C. M. Kemp will move its operation to Ocala, Fla., where parent-company Flair Corp. is based. Flair bought C. M. Kemp last year and, to save money, will merge the two plants.

Florida is "a cheaper place to be in manufacturing," said James F. Kensky, C. M. Kemp's president, who will not move with the company.

Pub Date: 4/26/96

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