Retooling the economic engine

By Heather B. Hayes 
Published on February 4, 2001

Given the extended economic expansion of the last decade, it’s easy to forget that some communities didn’t get their fair share of the spoils. Take Coos Bay. This quiet, pristine community of 40,000 residents on Oregon’s southern coast had long bet its economic fortunes on logging and fishing. But in the early 1980s, due to new federal restrictions and other factors, those industries fell into a slow but steady decline and never recovered.

The results have been double-digit unemployment rates, massive underemployment for workers who chose to stay, decreased tax revenues and increased social problems — a situation that even the town’s most optimistic residents refer to as “really sad.”

A year ago, however, Coos Bay took its first step into the New Economy and — town officials hope — a first step toward economic recovery.

Thanks to a few lucky breaks and its own proactive approach, the community landed CyberRep.coM Inc., a Virginia-based call center operation that provides toll-free help for customers of, among others, Microsoft Corp.’s MSN online service and LLC.

Today, the firm employs 400 people, many of them former loggers and fishermen. And there are plans to hire up to 500 more. The jobs — which include customer service and technical service representatives — pay between $9 and $10.50 an hour, along with benefits.

This rags-to-not-quite-riches story began when 800 Support, a Portland-based firm recently acquired by CyberRep.coM, decided to expand and open a satellite operation somewhere in the Pacific Northwest. John Stadter, then the chief financial officer for 800 Support, had grown up in the area and, wanting to return to his rural roots, decided to investigate the town, along with several other localities recommended by the Oregon Economic and Community Development Department.

Coos Bay quickly stood out on two fronts. It already had a fiber infrastructure. And more importantly, Stephen Kridelbaugh, president of Southwestern Oregon Community College, offered to provide the company with the necessary employee training free of charge for a year and to continue it for as long as needed.

“When you’re moving into an area, especially a rural one, one of your biggest concerns is, “Will I be able to get good, trained people?'” said Stadter, now the general manager for CyberRep.coM’s Coos Bay operation. “And [Kridelbaugh] really took that off the table in a big way.”

Allan Rumbaugh, general manager for the Port of Coos Bay, which helps put together economic development packages, agrees that the education issue was critical, along with an insistence that the residents meet the company’s requirements.

“They talked about their high turnover rate, we talked about our stable workforce,” he said.

In fact, according to Stadter, the Coos Bay operation has had a significantly lower turnover rate than other call centers. He attributes it to the area’s solid work ethic and the fact that his employees tend to be older and more mature than elsewhere.

Most residents have welcomed CyberRep.coM with open arms, but everyone acknowledges that one call center does not an economic recovery make. John Sweet, who works for Sause Bros. Inc., a marine transportation company, calls the move “an important step towards diversification. Hopefully, it shows other people in the technology industry that we have a capable and willing workforce here.”

Others like Bill Lansing, president of Menasha Corp.’s forest products group, continue to put faith in a timber turnaround. “The new company certainly helps, but it is not the answer to our major problem, and that is that we need family-wage jobs. These new jobs don’t provide that,” he said, adding that as private-industry forests recover and begin to produce fiber, the area ought to concentrate on building mills that convert logs into lumber, plywood and other manufactured products.

Rumbaugh thinks that there’s plenty of room in Coos Bay for both timber and technology, and he’s already working to get more New Economy firms to follow the lead of CyberRep.coM. “I think that it will be easier for us now,” he said. “We know that we’re not fully recovered, but I think people here feel a lot more optimistic.”