Retail to dominate

The closing of the Mohawk Industries carpet-backing plant in December will push the past year’s manufacturing layoffs to more than 500 at two of Waynesboro’s largest plants.

But as the historical manufacturing heritage erodes, retail sales and tax revenues continue to grow, spurring new thinking among city officials.

“We’ve always been a manufacturing town,” Mayor Tim Williams said. “Eight or nine years ago, we started transitioning [to retail]. Thank goodness we have that.”

Mohawk and nearby Invista have been smacked by the housing slide and corresponding drop in carpet demand, leading to widespread layoffs, the latest sign — in addition to years of declining machinery and tools tax revenues — that manufacturing cannot carry the city, officials say.

Manufacturing tax revenue assessments from 2006 to 2008 fell 36.1 percent while taxable retail sales increased 10 percent according to Virginia Tax Department records. Retail sales have doubled since the mid-1990s.

The city had 1,983 retail and 1,780 manufacturing jobs at the end of the first quarter of 2009, according to the Virginia Employment Commission. New retail hires outpaced manufacturing hires 3 to 1 in 2008.

“The big manufacturers, they’re not growing,” Williams said.

But while the city cultivates retail and professional companies on its growing West End, marked by the opening of the Waynesboro Town Center in 2007, interest remains in courting smaller manufacturers, officials said.

“The trend with industry will be high-tech industry and small feeder-type businesses,” Williams said.

Vice Mayor Frank Lucente agreed, noting that the economic recession has dampened retail growth as well.

“The nation can’t survive just on trading goods,” he said. “We need manufacturing and production jobs.”

Former Vice Mayor Reo Hatfield said retail growth, such as with Wal-Mart, did not come easy to the city. The employment commission ranks Wal-Mart as the city’s fourth-largest employer.

“We have been blessed that our retail has grown ... and it is not nearly complete,” Hatfield said in an e-mail.

A movie theater and a $40-million research, commercial and entertainment space were proposed this year, and a recent study of land in the south of the city proposed mixed-use development.

“We need to be thinking today about the next 10 or 15 years,” Williams said, “how to cultivate that kind of retail and professional” business development.

Mohawk announced Monday that it will close its plant. About 120 workers will lose their jobs. Invista continues to “carefully monitor” flooring markets and does not anticipate changes at its plant, a company spokeswoman said Tuesday.