NEWTON, Iowa — LIKE his uncle, his grandfather and many of their neighbors, Arie
Versendaal spent decades working at the Maytag factory here, turning
coils of steel into washing machines.
When the plant closed
last year, taking 1,800 jobs out of this town of 16,000 people, it
seemed a familiar story of American industrial decline: another company
town brought to its knees by the vagaries of global trade.
Except
that Mr. Versendaal has a new factory job, at a plant here that makes
blades for turbines that turn wind into electricity. Across the road,
in the old Maytag factory, another company is building concrete towers
to support the massive turbines. Together, the two plants are expected
to employ nearly 700 people by early next year.
“Life’s not
over,” Mr. Versendaal says. “For 35 years, I pounded my body to the
ground. Now, I feel like I’m doing something beneficial for mankind and
the United States. We’ve got to get used to depending on ourselves
instead of something else, and wind is free. The wind is blowing out
there for anybody to use.”
From the faded steel enclaves of
Pennsylvania to the reeling auto towns of Michigan and Ohio, state and
local governments are aggressively courting manufacturing companies
that supply wind energy farms, solar electricity plants and factories
that turn crops into diesel fuel.
This courtship has less to do
with the loftiest aims of renewable energy proponents — curbing
greenhouse gas emissions and lessening American dependence on foreign
oil — and more to do with paychecks. In the face of rising
unemployment, renewable energy has become a crucial source of good
jobs, particularly for laid-off Rust Belt workers.
Amid a
presidential election campaign now dominated by economic concerns, wind
turbines and solar panels seem as ubiquitous in campaign advertisements
as the American flag.
No one believes that renewable energy can
fully replace what has been lost on the American factory floor, where
people with no college education have traditionally been able to
finance middle-class lives. Many at Maytag earned $20 an hour in
addition to health benefits. Mr. Versendaal now earns about $13 an
hour.
Still, it’s a beginning in a sector of the economy that
has been marked by wrenching endings, potentially a second chance for
factory workers accustomed to layoffs and diminished aspirations.
In
West Branch, Iowa, a town of 2,000 people east of Iowa City, workers
now assemble wind turbines in a former pump factory. In northwestern
Ohio, glass factories suffering because of the downturn in the auto
industry are retooling to make solar energy panels.
“The
green we’re interested in is cash,” says Norman W. Johnston, who
started a solar cell factory called Solar Fields in Toledo in 2003.
The
market is potentially enormous. In a report last year, the Energy
Department concluded that the United States could make wind energy the
source of one-fifth of its electricity by 2030, up from about 2 percent
today. That would require nearly $500 billion in new construction and
add more than three million jobs, the report said. Much of the growth
would be around the Great Lakes, the hardest-hit region in a country
that has lost four million manufacturing jobs over the last decade.
Throw
in solar energy along with generating power from crops, and the
continued embrace of renewable energy would create as many as five
million jobs by 2030, asserts Daniel M. Kammen, director of the
Renewable and Appropriate Energy Laboratory at the University of
California, Berkeley, and an adviser to the presidential campaign of
Senator Barack Obama.
The
unfolding financial crisis seems likely to slow the pace of
development, making investment harder to secure. But renewable energy
has already gathered what analysts say is unstoppable momentum. In
Texas, the oil baron T. Boone Pickens
is developing what would be the largest wind farm in the world. Most
states now require that a significant percentage of electricity be
generated from wind, solar and biofuels, effectively giving the market a government mandate.
And many analysts expect the United States to eventually embrace some form of new regulatory system aimed at curbing global warming
that would force coal-fired electricity plants to pay for the pollution
they emit. That could make wind, solar and other alternative fuels
competitive in terms of the cost of producing electricity.
Both
presidential candidates have made expanding renewable energy a policy
priority. Senator Obama, the Democratic nominee, has outlined plans to
spend $150 billion over the next decade to spur private companies to
invest. Senator John McCain, the Republican nominee, has spoken more generally of the need for investment.
In
June, more than 12,000 people and 770 exhibitors jammed a convention
center in Houston for the annual American Wind Energy Association trade
show. “Five years ago, we were all walking around in Birkenstocks,”
says John M. Brown, managing director of a turbine manufacturer,
Entegrity Wind Systems of Boulder, Colo., which had a booth on the show
floor. “Now it’s all suits. You go to a seminar, and it’s getting
taught by lawyers and bankers.”
So it goes in Iowa. Perched on
the edge of the Great Plains — the so-called Saudi Arabia of wind — the
state has rapidly become a leading manufacturing center for wind power
equipment.
“We are blessed with certainly some of the best wind in the world,” says Chet Culver, Iowa’s governor.
MAYTAG
was born in Newton more than a century ago. Even after the company
swelled into a global enterprise, its headquarters remained here, in
the center of the state, 35 miles east of Des Moines.
“Newton was an island,” says Ted Johnson, the president of local chapter of the United Automobile Workers,
which represented the Maytaggers. “We saw autos go through hard times,
other industries. But we still had meat on our barbecues.”
The end began in the summer of 2005. Whirlpool,
the appliance conglomerate, swallowed up Maytag. As the word spread
that local jobs were doomed — Whirlpool was consolidating three
factories’ production into two — workers unloaded their memorabilia at
Pappy’s Antique Mall downtown: coffee mugs, buttons, award plaques.
Darius Coltrain, a new employee at TPI, measures the general manager,
Crugar Tuttle, in millimeters as part of training in the metric system.
“If it said Maytag on it, we
bought it,” says Susie Jones, the store manager. “At first, I thought
the stuff had value. Then, it was out of the kindness of my heart. And
now I don’t have any heart left. It don’t sell. People are mad at them.
They ripped out our soul.”
When the town needed a library, a park
or a community college, Maytag lent a hand. The company was Newton’s
largest employer, its wages paying for tidy houses, new cars, weddings,
retirement parties and funerals.
As Whirlpool made plans to
shutter the factory, state and county economic development officials
scrambled to attract new employers. In June 2007, the local government
dispatched a team to the American Wind Energy Association show in Los
Angeles. Weeks later, a company called TPI Composites arrived in Newton
to have a look.
Based in Arizona, TPI makes wind turbine blades
by layering strips of fiberglass into large molds, requiring a long
work space. The Maytag plant was too short. So local officials showed
TPI an undeveloped piece of land encircled by cornfields on the edge of
town where a new plant could be built.
Although TPI was
considering a site in Mexico with low labor costs, Newton had a better
location. Rail lines and Interstate 80 connect it to the Great Plains,
where the turbines are needed. Former Maytag employees were eager for
work, and the community college was ready to teach them blade-making.
Newton
won. In exchange for $6 million in tax sweeteners, TPI promised to hire
500 people by 2010. It has already hired about 225 and is on track to
have a work force of 290 by mid-November.
“Getting 500 jobs in
one swoop is like winning the lottery,” says Newton’s mayor, Chaz
Allen. “We don’t have to just roll over and die.”
On a recent
afternoon, workers inside the cavernous TPI plant gaze excitedly at a
crane lifting a blade from its mold and carrying it toward a cleared
area. Curved and smooth, the blade stretches as long as a wing of the
largest jets. One worker hums the theme from “Jaws” as the blade slips
past.
Larry Crady, a worker, takes particular pleasure in seeing
the finished product overhead, a broad grin forming across his goateed
face. He used to run a team that made coin-operated laundry machines at
Maytag. Now he supervises a team that lays down fiberglass strips
between turbine moldings. He runs his hand across the surface of the
next blade for signs of unevenness.
“I like this job more than
I did Maytag,” Mr. Crady says. “I feel I’m doing something to improve
our country, rather than just building a washing machine.”
Ask
him how long he spent at Maytag and Mr. Crady responds precisely: “23.6
years.” Which is to say, 6.4 years short of drawing a pension whose
famously generous terms compelled so many to work at the Maytag plant.
“That’s what everyone in Newton was waiting on,” he says. “You could
get that 30 and out.”
But he is now optimistic about the decades
ahead. “I feel solid,” he says. “This is going to be the future. This
company is going to grow huge.”
The human resources office at TPI
is overseen by Terri Rock, who used to have the same position at
Maytag’s corporate headquarters, where she worked for two decades. In
her last years there, her job was mostly spent ending other people’s
jobs.
“There was a lot of heartache,” she says. “This is a small
town, and you’d have to let people go and then see them at the grocery
store with their families. It was a real tough job at the end.”
Now,
Ms. Rock starts fresh careers, hiring as many as 20 people a week. She
enjoys the creative spirit of a start-up. “We’re not stuck with the
mentality of ‘this is how we’ve done it for the last 35 years,’ ” she
says.
Maytag is gone in large part because of the calculus driving
globalization: household appliances and so many other goods are now
produced mostly where physical labor is cheaper, in countries like
China and Mexico. But wind turbines and blades are huge and heavy. The
TPI plant is in Iowa largely because of the costs of shipping such huge
items from far away.
“These are American jobs that are hard to export,” says Crugar Tuttle, general manager of the TPI plant.
And
these jobs are part of a build-out that is gathering force. More than
$5 billion in venture capital poured into so-called clean energy
technology industries last year in North America and Europe, according
to Cleantech, a trade group. In North America, that represented nearly
a fifth of all venture capital, up from less than 2 percent in 2000.
“Everybody involved in the wind industry is in a massive hurry to build
out capacity,” Mr. Tuttle says. “It will feed into a whole local
industry of people making stuff, driving trucks. Manufacturing has been
in decline for decades. This is our greatest chance to turn it around.
It’s the biggest ray of hope that we’ve got.”
Those rays aren’t
touching everyone, though. Hundreds of former Maytag workers remain
without jobs, or stuck in positions paying less than half their
previous wages. Outside an old union hall, some former Maytaggers share
cigarettes and commiserate about the strains of starting over.
Mr.
Johnson, the former local president, is jobless. At 45, he has slipped
back into a world of financial hardship that he thought he had escaped.
His father was a self-employed welder. His mother worked at an overalls
factory.
“I grew up in southern Iowa with nothing,” he says. “If somebody got a new car, everybody heard about it.”
When
Maytag shut down, his $1,100-a-week paycheck became a $360 unemployment
check. He and his wife divorced, turning what once was a two-income
household into a no-income household. He sold off his truck, his dining
room furniture, his Maytag refrigerator — all in an effort to pay his
mortgage. Last winter, he surrendered his house to foreclosure.
Mr.
Johnson has applied for more than 220 jobs, he says, from sales
positions at Lowe’s to TPI. He has yet to secure an interview. His
unemployment benefits ran out in May. He no longer has health
insurance. He recently broke a tooth where a filling had been, but he
can’t afford to have it fixed.
When his teenage daughter, who
lives with him, complained of headaches, he paid $1,500 out of pocket
for an M.R.I. The doctor found a cyst on her brain. And how is she
doing now? Mr. Johnson freezes at the question. He is a grown man with
silver hair, a black Harley-Davidson
T-shirt across a barrel chest, and calloused hands that could once
bring a comfortable living. He tries to compose himself, but tears
burst. “I’m sorry,” he says.
He signed up for a state insurance program for low-income families so his daughter could go to a neurologist.
ALTHOUGH
the United States is well behind Europe in manufacturing wind-power
gear and solar panels, other American communities are joining Newton’s
push, laying the groundwork for large-scale production.
“You
have to reinvest in industrial capacity,” says Randy Udall, an energy
consultant in Carbondale, Colo. “You use wind to revitalize the Rust
Belt. You make steel again. You bring it home. We ought to be planting
wind turbines as if they were trees.”
In West Branch, Acciona, a
Spanish company, has converted the empty hydraulic pump factory into a
plant that makes wind turbines. When the previous plant closed, it
wiped out 130 jobs; Acciona has hired 120 people, many of them workers
from the old factory.
Steve Jennings, 50, once made $14 an hour
at the hydraulic pump factory. When he heard that a wind turbine plant
was coming in a mere five miles from his house, he was among the first
to apply for a job. Now he’s a team leader, earning nearly $20 an hour
— more than he’s ever made. Ordinary line workers make $16 an hour and
up.
“It seemed like manufacturing was going away,” he says. “But I think this is here to stay.”
Acciona
built its first turbine in Iowa last December and is on track to make
200 this year. Next year, it plans to double production.
For now,
Acciona is importing most of its metal parts from Europe. But the
company is seeking American suppliers, which could help catalyze
increased metalwork in the United States.
“Michigan, Ohio — that’s the Rust Belt,” says Adrian LaTrace, the
plant’s general manager. “We could be purchasing these components from
those states. We’ve got the attention of the folks in the auto
industry. This thing has critical mass.”
IN Toledo, the declining auto
industry has prompted a retooling. For more than a century, the city
has been dominated by glass-making, but the problems of Detroit
automakers have softened demand for car windows from its plants. Toledo
has lost nearly a third of its manufacturing jobs since 2000.
Now,
Toledo is harnessing its glass-making skills to carve out a niche in
solar power. At the center of the trend is a huge glass maker,
Pilkington, which bought a Toledo company that was born in the 19th
century.
Half of Pilkington’s business is in the automotive
industry. In the last two years, that business is down 30 percent in
North America. But the solar division, started two years ago, is
growing at a 40 percent clip annually.
Nearby, the University
of Toledo aims to play the same enabling role in solar power that
Stanford played at the dawn of the Internet. It has 15 faculty members
researching solar power. By licensing the technologies spawned in its
labs, the university encourages its academics to start businesses.
One
company started by a professor, Xunlight, is developing thin and
flexible solar cells. It has 65 employees and expects to have as many
as 150 by the middle of next year.
“It’s a second opportunity,”
says an assembly supervisor, Matt McGilvery, one of Xunlight’s early
hires. Mr. McGilvery, 50, spent a decade making steel coils for $23 an
hour before he was laid off. Xunlight hired him this year. His paycheck
has shrunk, he says, declining to get into particulars, but his
old-fashioned skills drawing plans by hand are again in demand as
Xunlight designs its manufacturing equipment from scratch, and the
future seems promising.
“The hope is that two years from now
everything is smoking and that envelope will slide across the table,”
he says. “The money that people are dumping into this tells me it’s a
huge market.”
In Newton, the tidy downtown clustered around a
domed courthouse is already showing signs of new life, after the pain
of Maytag’s demise.
The owner of Courtyard Floral, Diane Farver,
says she saw a steep drop in sales after Maytag left, particularly
around holidays like Valentine’s Day and Mother’s Day, when she used to
run several vanloads a week to the washing machine plant. Times have
changed since that decline. When TPI recently dispatched workers to a
factory in China for training, the company ordered bouquets for the
spouses left at home.
Across the street at NetWork Realty, the
broker Dennis Combs says the housing market is starting to stabilize as
Maytag jobs are replaced.
“We’ve gone from Maytag, which wasn’t
upgrading their antiquated plant, to something that’s cutting-edge
technology, something that every politician is screaming this country
has to have,” he says.
At Uncle Nancy’s Coffee House, talk of unemployment checks and foreclosures now mixes with job leads and looming investment.
“We’re seeing hope,” says Mr. Allen, the mayor.
The
town is hardly done. Kimberly M. Didier, head of the Newton Development
Corporation, which helped recruit TPI, is trying to attract turbine
manufacturers and providers of raw materials and parts for the wind
industry.
“This is in its infancy,” she says. “Automobiles,
washer-dryers and other appliances have become commodities in their
retirement phase. We’re in the beginning of this. How our economy
functions is changing. We built this whole thing around oil, and now
we’ve got to replace that.”