LIFE AFTER HP…….

[Anonymous]

Life after HP
An aerial view shows the Hewlett-Packard campus along the Willamette River. In the last year, HP has cut more than 700 jobs from its Corvallis location.
Corvallis looks to replace jobs shed by shrinking tech giant
The news hit like a hammer blow: Hewlett-Packard announced in May that it was cutting 570 jobs at its Corvallis campus through a voluntary severance program.
Even factoring in the positive impact of HP’s generous severance payments, an Oregon State University economist calculated the loss to the mid-valley economy at $112 million in gross sales.
By year’s end the news was even worse: At least another 139 jobs at HP had been lost, raising the toll above 700.
These were some of the best jobs around, too, with high salaries and good benefits. As the OSU economist, Bruce Sorte, put it: “When you take away a job like you have at Hewlett-Packard, your economy actually contracts.”
What can Corvallis do to replace the loss of 700-plus top-quality jobs?
That question, says Mysty Rusk, executive director of the Corvallis-Benton County Economic Development Partnership, “is the one I lose sleep over. … I think it’s in the forefront of everybody’s mind.”
The good news is that Rusk and dozens of other leaders in government, academia and business – including HP – are working to do something about it.
The Economic Vitality Partnership, a coalition of 14 local business interest groups, has launched a campaign dubbed Prosperity That Fits.Through a survey of community members, a poll of randomly selected businesses and a series of public forums facilitated by a professional consulting firm, the group plans to create a business action plan to guide economic development efforts in Corvallis and Benton County.
By building lots of public input into the process, the EVP hopes to short-circuit the public opposition that has dogged so many development proposals and repackage Corvallis as a community that is open for business – at least, for business that fits.
A similar process led by the Downtown Corvallis Association is under way to revitalize the city’s commercial core.
On the industrial side, veteran businesswoman Jean Mater conducted a survey last year to identify the challenges and opportunities facing local manufacturers.
Oregon State University has ratcheted up its technology transfer efforts. In addition to increasing licensing income for the university, the aim is to spin off local companies based on OSU research – companies with the potential to generate local jobs.
OSU’s Austin Entrepreneurship Program, housed in the renovated Weatherford Hall, is also seen as a potential job engine. The recently completed Kelley Engineering Center, billed as “a home for innovation,” reinforces the message that research and commerce should go hand in hand, as does the university’s plan to build a research park at the old OSU poultry farm.
Another university-based effort, the Oregon Nanoscience and Microtechnologies Institute, is starting to hit its stride. Housed in rent-free space donated by Hewlett-Packard in Building 11 of the Corvallis campus, ONAMI pairs academic and corporate researchers with scientists from the Department of Energy’s Pacific Northwest National Laboratory.
“We’ve completed our lab in building 11,” said Skip Rung, ONAMI’s director. “PNNL has completed their lab.”
Meanwhile, in addition to supporting the work of the Economic Vitality Partnership, the Economic Development Partnership continues to pursue its own efforts to assist local businesses and attract new ones.
There are a handful of large companies looking at Corvallis as a potential location, Rusk said, including a biofuel producer, a manufacturer of light equipment and a biotech firm. There’s no way to know at this point whether any of them will proceed further, but if they all did, Rusk said, “it could be as many as 500 jobs over the next three years.”
Most of her energies, Rusk said, are focused on retention – helping companies that are already here succeed. And those efforts are bearing some fruit.
ATS Oregon, a maker of factory automation equipment, credited the EDP, the Chamber of Commerce and Linn-Benton Community College with helping to locate and train some skilled technicians the company was having a tough time finding. General manager Jim Sheldon said recently the assistance was crucial in helping ATS land a $24 million contract with a big biotech company, a contract he expected to lead to at least 20 more hires.
Perhaps the most intriguing job-creation initiative to come along in years also comes from the EDP. Chaired by Rung, its aim is to recruit microtechnology companies from Seattle, Silicon Valley and Southern California.
“That’s the expertise we see in Corvallis,” said Rung, a former HP research and development manager who notes that the company’s Corvallis campus is the birthplace of inkjet printing technology and boasts the world’s most advanced microtech facilities.
All of those highly skilled engineers who left the company this year form an attractive labor pool for other firms working in the field.
Other Corvallis companies engaged in microtech activities include ATS, Korvis Automation, ImTech, Tripod Data Systems and numerous small shops and consulting firms. And of course, Rung adds, there’s ONAMI.
“We think we’re an attractive destination for microtechnology companies, particularly some in the San Francisco Bay Area who know they have to go somewhere cheaper,” Rung said.
High-tech entrepreneur Joe LaChapelle, who serves on the recruiting team’s advisory board, is not so sure.
“There are a lot of good places to do high-tech business,” he points out. “You could argue that we’re cheaper than the Bay Area, but that gap is closing.”
LaChapelle is an OSU grad who spent time working in the Bay Area before returning to Corvallis a few years ago and teaming up with two Oregon partners to launch Deep Photonics, a manufacturer of ultraviolet lasers. He thinks his small company is a likelier model for economic recovery: a homegrown startup that expands gradually over time.
“The kind of jobs we want, in Corvallis and Benton County in particular, are going to be generated by us hitting a lot of base hits here,” LaChapelle said.
But Rung, Rusk and others believe Corvallis may have an ace in the hole when it comes to attracting outside microtech firms, and it comes from a somewhat surprising source: Hewlett-Packard.
One intriguing byproduct of years of downsizing at HP’s Corvallis campus is space, and lots of it. Although HP officials could not be reached to confirm it, there’s a growing buzz around town that the global high-tech giant might be willing to lease some of that space to outside companies.
“It’s a legitimate possibility,” said Rung, who thinks HP might even consider leasing out parts of its state-of-the-art lab facilities in addition to straight office space.
“Obviously, they would be very selective about who they make that space available to,” he said.
But he also noted that HP’s local real estate manager, Steve Love, has a seat on the microtech recruiting team’s advisory board.
In the end, Hewlett-Packard – the company whose deep job cuts have sparked a recruiting scramble – could wind up being the city’s best recruiting tool.
“They will be part of the effort,” Rung said, “and they support the effort.”

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January 3, 2006 at 12:11 PM