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Pittsburgh Not Mourning Loss of Rockwell to L.A.

May 30, 1988|LINDA WILLIAMS | Times Staff Writer

For Willard F. Rockwell Jr., the news that Rockwell International is moving its corporate headquarters from Pittsburgh to Southern California wasn't something he enjoyed hearing last week.

"There is a little disappointment on our part," said Rockwell, whose family founded the company and who from 1967 to 1973 served as chairman. "But everything combined, I don't think it makes a difference."

"In a sense, it hasn't been here for a long time," said Rockwell, who is chairman of Astrotech International, an electronics firm in Pittsburgh. "The chairman and a lot of those people live out there in Southern California."

Often it is big news when a new headquarters city is named for a major company like Rockwell, No. 27 on the Fortune 500 list of largest industrial companies. But last week Rockwell took deliberate steps to downplay the move and to point out that it will have virtually no effect on taxes or employment levels at either location.

As a result, the news wasn't particularly traumatic or jarring for those involved. Still, there remain symbolic issues of emotion and prestige, noted Robert Pease, executive director of the Allegheny Conference on Community Development, a private economic development agency in Pittsburgh.

"The company has been here for a long time. We're losing the mantle of a headquarters company," Pease said, even though Rockwell--one of the nation's largest aerospace contractors--isn't moving any jobs from Pittsburgh.

Symbolically, the move may mean more for Los Angeles. While Southern California has attracted the headquarters of many companies because executives like the region's life style, it has lagged behind many smaller cities as home base for Fortune 500 concerns.

Moving to 10th Place

Even with Rockwell moving its headquarters to El Segundo near Los Angeles International Airport, Pittsburgh remains No. 3 among U.S. cities with headquarters of Fortune 500 companies. But metropolitan Los Angeles breaks into the top 10 with the addition of Rockwell. It shares 10th place with Atlanta, Minneapolis, St. Louis and Stamford, Conn.

Such rankings have some value as cities vie for business, said Justin Horan, president of the Greater Pittsburgh Chamber of Commerce. "The most important statement I could make in recent years was the Rand McNally ranking of Pittsburgh as the most livable city in the U.S," Horan said. "In a similar nature, the Fortune 500 ranking was also a statistic I could quote."

With the move, Rockwell International becomes California's fourth-largest public corporation. The company had $12.7 billion in sales last year. It is also one of California's largest industrial employers with a work force of 37,000 people. Workers here build aircraft, satellites, rocket engines, manned spacecraft, missile guidance systems, computer chips and a range of other sophisticated defense equipment. Those operations accounted for 42% of last year's sales.

No Tax Consequences

Rockwell already has 300 corporate office workers, including nine corporate officers, in El Segundo, including its chairman, chief executive and president, Donald R. Beall, who is a longtime resident of Corona del Mar in Orange County. The designation of El Segundo as corporate headquarters reflects the company's growing corporate presence in Southern California, the company said. The move won't have tax or legal consequences, said a company spokesman.

Some 300 corporate employees and a number of corporate functions will remain in Pittsburgh, the company said.

Luring another Fortune 500 firm's headquarters won't be a priority for Pittsburgh, Pease said. Unemployment in Pittsburgh is about 6%--down substantially from about 17% in 1983, he said. The major reason for the turnaround was the expansion of services, health, research and small companies. "We're concentrating our efforts on growing small companies and creating small companies," he said. The real possibilities of getting a major corporation to relocate "are few and far between."

The Rockwell announcement was good news to the Los Angeles Area Chamber of Commerce. "There is an amount of prestige that goes with it," said spokeswoman Kathy Shilkret. "When the rest of the country hears about Rockwell, it will be hearing about L.A."

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