RI Loses 1,000 Jobs in Less than a Week - Leaders Weigh In

Wednesday, September 13, 2017
GoLocalProv News Team and Kate Nagle

First Benny's, now Alexion -- two RI employers are closing their doors, to the tune of 1,000 jobs.
Rhode Island Governor Gina Raimondo is usually the first to announce when there are good job numbers to report; however she has been noticeably absent regarding the loss of nearly 1,000 jobs impacting the state and region, from Benny's decision to close all its stores -- costing some 700 jobs -- and now Alexion Pharmaceuticals pulling out of Rhode Island and chopping 250 jobs. 

"The loss of the Alexion jobs, those are high paying jobs with fringe benefits. That transcends just the 'number,' said University of Rhode Island economist Len Lardaro. "Will those skilled people be able to find jobs here or will they migrate?"

The Commerce Corporation released a statement on Tuesday in response to Alexion's departure, which comes just one year after it broke ground in the summer of 2016 on $200 million expansion project in Rhode Island. The Governor's office refused comment, however. 

SLIDES: See What RI Leaders Are Saying BELOW

"Right now, we're doing fairly well, compared to where we've been," said Lardaro. "But because Rhode Island hasn't reinvented itself the way it should have years ago, we can only go as far as the national and Boston economies pull us."

"Do we have enough margin for error? I'm not sure. We haven't gone as far as we should have," said Lardaro. "Rhode Island's approach to planning and development is primitive and backward. We don't have due diligence -- we're amateurish."

As GoLocal reported this week, following retail giant Amazon's announcement it is looking for a new, second headquarters location which would mean 50,000 jobs, the Raimondo administration has had little to say, while other states are publicly putting together leadership teams and strategies to make the case to lure the game-changing business. 

State Role in Alexion

With Alexion's departure, Commerce clarified that it hadn't offered any financial incentives to keep the company.

"[We offered] no financial incentives as part of their recent proposed expansion," said Matt Sheaff with Commerce. "We did help navigate state and local approvals needed for the expansion -- planning, zoning, soil erosion and traffic. We also helped with a land swap that was important for the transaction."

Last summer, Alexion stated that what had been intended to be a $200 million expansion would have meant 400 jobs in the state.

Now, Rhode Island is watching Alexion move its operations up to Massachusetts. 

"In a prior administration, Alexion received as part of the Jobs Development Act a reduction in their corporate income tax," noted Sheaff. 

  • Lincoln Chafee

    Former Rhode Island Governor and United States Senator

    "I think these are two separate, unfortunate circumstances. Benny's is a victim of the present evolution of capitalism that favors the biggest chains which can provide lower prices. I hesitate to comment with any authority about the reasons for Alexion leaving Rhode Island.

    But as a rule, companies don't like uncertainty and we face large deficits in our fiscal forecast as well as the fact that RhodeWorks is being put on a credit card - the hundreds of millions of dollars are being spent but the toll scheme of payment has yet to be implemented. And the trucking association has publicly promised a legal challenge."

     
  • Patricia Morgan

    House Minority Leader - Potential GOP Gubernatorial Candidate

    "This is an issue of political will. Alexion could have chosen to consolidate to Rhode Island, but they went to Massachusetts instead.  The 1,000+ jobs being lost by Benny’s and Alexion, in addition to the 500 manufacturing jobs Rhode Island lost last quarter are indicative of a hostile business environment in our state.  We’ve known for decades that our economic foundation is weak and in need of repair.  

    Unfortunately, our state leaders lack the political will to tackle the fundamental reform that will change our business climate for the better. Until we have leaders in Rhode Island who are willing to fight to make our state a place companies would rather be than anywhere else, we will continue to lose jobs."

     
  • Giovanni Feroce

    CEO, BENRUS - Former State Senator and Potential GOP Gubernatorial Candidate

    "The hit is on two levels. Number one, there is the direct hit, loss of jobs being the paramount short term concern.  We need to be proactive in "landing" the talent that worked there quickly in new roles at new companies.

    The second is the real hit, which in military terms we call the "second and third order effects." How does this impact the community as a whole?  We need to be vigilant in incorporating planning.  We don't have planning processes that I know of in economic solutions at the state and local levels. No one is feeding a "Master Plan." In the months to come, I will be very specific as to what that looks like.  The superiority in understanding and executing a plan and dealing with contingency planning will provide confidence to Rhode Islanders that leadership exists, but it requires a "coming together" as a whole to focus on what is best for Rhode Island and not what is best for an individual or one company or one political party.  We must adapt to the 21st-century business environment in a transformational and comprehensive way.  We can do it.

    I have always believed that a proactive approach to asking RI businesses what they need and not a "luring" of individual companies that do not feed a master plan is the best short term approach.  At the end of the day, these "surprise" announcements mean there is a lack of communication.

    [The job losses] are clearly indicative of Rhode Island's lack of a comprehensive approach to business sectors.  A few years ago I took a trip to see the third lock being built in Panama, next thing you know Savannah, GA built a whole infrastructure 20 miles inland out to the port to become the new leader in anticipating and receiving goods, therefore becoming a leader in an industry.  It is that kind of thinking we need here in Rhode Island." 

     
  • Mike Stenhouse

    CEO, Rhode Island Center for Freedom and Prosperity

    "As our Center has warned for years, Rhode Island will continue to suffer hits like this, many of them smaller and un-publicized, until we make serious reforms that improve our state's dismal business climate. The corporate welfare strategy that taxes all of us, along with the anti-employer agenda of the progressive-left, are failing the businesses and people of Rhode Island. 

    While it's unclear if it could have saved Benny's, major reductions to the sales tax remains the most impactful reform that we can undertake. It would make our state more competitive, while increasing our consumer base, and would also be a boon to retailers as a hedge against the growing Internet sales trend."

     
  • Pat Ford

    Chair, Rhode Island Libertarian Party

    "[PawSox] Stadium, UHIP, parking meters, 38 Studios, and on and on. What do you get?  Poof.  1000 jobs disappear."

    (Ford pictured right)

     
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