North Carolina transformation has winners, losers

KANNAPOLIS, N.C. — A red-brick symbol of North Carolina's economic transition is rising from the groomed dirt where 6 million square feet of textile mills once stood. The new building's pillars and crowning dome seem transplanted from the college town of Chapel Hill, two hours north, which is entirely the point.

This is the first phase of the North Carolina Research Campus, a $1.5 billion plan to transform a small town outside Charlotte in the same way the state overhauled its economy: by building knowledge-driven industries amid the shuttered factories. As other states struggled with globalization, North Carolina invested in education and research. Its economy grew faster than the nation's.

But the innovation boom bypassed many North Carolina residents. The state's poverty rate exceeds the national average. Experts say a new sort of segregation has set in, with education levels, rather than race, barricading workers from higher-paying jobs. Kannapolis officials estimate their health and biotech research campus will create at least 37,000 jobs. Those jobs are out of reach for some of the 4,000-plus workers laid off when the Pillowtex mill closed five years ago.

"North Carolina has made tremendous progress, and for the people who have been well-positioned, they've risen with the tide," said David Dodson, president of the nonprofit MDC Inc., which champions economic opportunity in the South. "But for those people who don't have the skill set, the educational background, they are finding themselves locked out [economically] in a way race used to do."

For Sens. Barack Obama or Hillary Rodham Clinton, those workers' votes could make the difference in the state's presidential primary Tuesday — and in the November election.

Fifty years ago, North Carolina boasted a textile-and-tobacco economy and some of the lowest incomes per capita in the country. University, political and business leaders responded by creating arguably the most successful economic development project in U.S. history: the Research Triangle Park, 7,000 acres between North Carolina State University in Raleigh, Duke University in Durham and the University of North Carolina at Chapel Hill.

The park's tenants, including technology giants, pharmaceutical makers and financial-service firms, employ nearly 40,000 people. A robust banking industry has sprouted in Charlotte. State incomes have climbed.

The Charlotte and Raleigh areas now "are two of the stronger economies in the country," said Mark Vitner, a senior economist at Wachovia in Charlotte. But, he added, "There have been parts of the state that have really been hit hard."

When the mill that sustained Kannapolis for nearly 100 years closed, the town looked to replicate the Research Triangle Park on the mill's former grounds. The new research campus is backed by a $1.5 billion investment from David Murdock, owner of Dole Foods. City Manager Mike Legg calls it "transformational."

For some former millworkers, transformation meant job retraining in service or support industries. Others ended up waiting tables.

Clinton is heavily courting voters like them in hopes of an upset victory in the primary. Polls show her running best in Charlotte and in the Old Economy towns in western North Carolina, which typically go Republican in general elections.

Obama's strength around Raleigh and among the state's sizable black population makes him the favorite, but to put North Carolina in play this fall, analysts say Obama needs those working-class voters as well.

Ferrel Guillory, who directs the Program on Southern Politics, Media and Public Life at the University of North Carolina, said the state gives Obama "both a challenge and an opportunity to show that he's at least willing to get out there and talk to the kind of people who once worked in a textile mill and are now selling washing machines at Sears."

Others urge investment in community colleges and infrastructure programs — training and jobs for people who lack college degrees.

"We are not serious about mitigating the adverse impacts of global integration," said Rick Weddle, president and chief executive of the Research Triangle Park. "We have this tendency to say, as a country, on average, it's been a good deal. Well, averages will get you in trouble. ... If you have one foot in boiling water and the other on an ice block, on average, the temperature's normal."