NORFOLK, Va. (WAVY) — A local economist says the potential move of Norfolk Southern’s headquarters out of Hampton Roads may not be as bad as you think.
Business and economic experts tell 10 On Your Side the deal that Atlanta is offering Norfolk Southern to move is just too good for a business to pass up.
The City of Norfolk cannot compete with it and, one expert says, they shouldn’t even try. “Sometimes by losing, you actually win,” said ODU Professor of Economics Robert McNab.
Losing a big name like Norfolk Southern is a blow, but McNab says letting it go without a fight might be best option for Hampton Roads.
“The question is at the end of the day, do we want to try and compete in terms of public subsidies to private companies,” he said.
McNab said the deal that Atlanta’s city council just brokered could possibly cost taxpayers there billions of dollars. “That’s resources that can’t go to public schools, can’t go to police, fire and safety and so for us to compete for that, to actually attract firms in that way, would be a drain on the taxpayer.”
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McNab said it might pay off for Atlanta in a decade or two, or, “You could end up like Wisconsin that is now having to give taxpayer money to Foxconn to only provide around 3,000 jobs instead of the promised 13,000 jobs.”
According to McNab, evidence proves the better bet is putting money into other efforts that could bring more jobs. “Maybe instead of trying to get the biggest prize possible we go for medium size prizes.”
While Norfolk will miss the money Norfolk Southern and its employees spend to support charitable works, foundations and the arts, the loss of jobs overall is small compared to the overall size of the Hampton Roads economy, McNab says.
Norfolk Southern told 10 On Your Side about 500 employees work at their corporate headquarters and McNab reports there are over 700,000 people employed in the Hampton Roads region.
“It makes sense for them [Norfolk Southern] and it might make sense to the taxpayers of Atlanta in a couple decades, and for us it becomes another part of the challenge of economic development,” said McNab.
Norfolk Southern has made no announcement on a move since Atlanta’s city council vote. A corporate spokesperson told 10 On Your Side on Wednesday that nothing has changed.