Chamber members hear mixed news on R.I. economy
The news wasn’t always pretty when members of the Jamestown Chamber of Commerce gathered on March 25 for a breakfast meeting.
“The state has no money,” Executive Director of the R.I. Economic Development Corporation Keith Stokes told the crowd.
During the first five minutes of his speech, Stokes painted a grim picture of the state’s finances.
But he soon changed direction, offering some optimistic words for the future.
“We are in a recession,” he said. “However, we will come out of it. We have no choice.”
Stokes, along with State Representative Deb Ruggiero, was on hand to address the economic realities facing Rhode Island’s business community.
He went on to say that businesses can expect dramatic change in the way the state delivers services to its constituents.
He explained the details of the “guaranteed loan” program: Although the $20 million federal stimulus package is going to Rhode Island banks earmarked for small business loans, that does not guarantee that the banks will loan the money in this tough economy.
However, if the state guarantees any loans that go into default, the banks might be willing to loosen their credit policies, Stokes said.
He also said that the EDC is implementing programs to give businesses reasons to hire locally when jobs are available.
“This has to begin by making education one of our foremost priorities,” he said. The system needs to improve the level of education afforded to its students, he said, noting that 60% of high school graduates are not attending college or making efforts to further their education.
“The available jobs minimally require skills learned at the junior college level. Most require bachelor degrees,” he said.
Big companies, such as Raytheon and Electric Boat, are hiring from outside the state because local talent does not exist to fill available positions, he said.
“There are jobs out there,” Stokes said. “But Rhode Islanders aren’t getting them because they aren’t qualified. They aren’t qualified because they don’t have the education needed to meet the requirements. That has got to change.”
Stokes also noted that everywhere he goes to speak, the foremost subjects on everyone’s mind are jobs, cash and customers.
“We need jobs and we need reasons for people to do business in Rhode Island,” he said. “Incentive isn’t handing out big loans. Sixtyfi ve percent of Rhode Island businesses are small companies. Small business is the backbone of our economy.
But, he added, those businesses don’t need big loans.
“They need customers with cash,” he said. “When they have customers, businesses will have reasons to hire.”
Stokes also said that revenues from taxes are down.
“When there are no sales, there is no tax. Without sales, there is no money to pay taxes,” he said, adding that all efforts must focus on improving education, streamlining government services and creating incentive programs to bring businesses to Rhode Island.
To that end, Stokes announced that plans to reorganize and improve the corporate tax structure are in the works.
He said that we need to employ people who live here, and if we hire from out of state, we must make it attractive for the new employees to move here. We have too many outof state residents working in Rhode Island and taking money out by living within commuting distance, he said.
Ruggiero mirrored Stokes’ comments and outlined the programs that she is working on to improve education, healthcare and economic development. She also added wind energy and overcoming environmental issues to the mix.
“I ran on a platform of environmental economics, putting wind energy and biofuel at the forefront of economic development to create jobs. My four E’s – environment, economy, education and elderly.
“It was important that when I won, I would serve to make good on those promises,” she said.
She also said that she was encouraging businesses to hire interns from the various universities and other institutions of higher learning.
“Then, the interns can step into the job market with experience when they finish school,” she said. “Intern programs are good for everyone. They help reduce business costs, and they develop our greatest natural resource for the marketplace.”
Ruggiero and Stokes both emphasized that the state is not going to see any improvement without trimming “excessive fat” and delivering government services more effi ciently – starting with reducing the amount of paperwork.
The pair also emphasized that everyone must get their priorities in order and change the way they think about education and the incentives that stimulate the economy, increase revenues and create jobs.
Chamber member Jack Brittain, president of Jack’s Electric, said that he thought the messages were informative and gave the small business owners some hope.
“I hope they can deliver on the state guaranteed loan program in a timely manner,” he said. “Many businesses need immediate relief.”
Chamber of Commerce Vice President Peter Brockmann said, “They are thinking in the right direction. They recognize the problems, and I believe they are doing all they can to resolve them.”
Chamber President Annie McIntyre said she thought Stokes and Ruggiero were “right on” in their approach to turning things around for the Rhode Island business community.
“And I must thank Keith for bringing his staff with him to con- sult with local business owners,” she said. Director of Community Relations Sue Stenhouse and Cherri Lynn Carrera, manager of small business services for the R.I. EDC, also attended the breakfast meeting hosted by the Narragansett Café.
Most comments and suggestions were supportive of the ideas and concepts for change and improvement. The consensus among members seemed to be that the messages made sense, and that Stokes had a good handle on what can be done to help the small business owner.
But the big question seemed to be: How long before relief in any form will be a reality?