Coal has a rich heritage in West Virginia and has contributed significantly to the progress and well-being of West Virginians since it was first discovered in the 1700s, more than a century before West Virginia became a state. In the mid-1900s, coal employed more than 100,000 people in the Mountain State. However, over the years, mining related health concerns, political controversy, and climate change, in combination with technological advancements in the energy sector have all contributed to a shift away from coal. In 2019, coal employment in West Virginia was down to roughly 14,000.
Throughout this decline, poverty spiked, placing West Virginia consistently among the poorest states in the country. The state has also come to lead the nation in population decline, with young West Virginians increasingly leaving to find gainful employment. Health impacts are widespread, and in a state prized for its natural beauty, the environmental situation is no better. Abandoned mines and thousands of uncapped oil and gas wells pollute local air and water. Mountaintop removal, a mining practice that involves deforesting mountain peaks and then blasting them out of existence to get at coal underneath, continues to cover surrounding areas in hazardous dust.
Increasingly, a transition away from coal is a conversation many West Virginians are now willing to entertain. And West Virginia is ripe for reinvestment, which the state’s Tourism Department has begun to capitalize on. Leveraging the natural beauty and rich cultural history of the state, West Virginia’s tourism industry has been outpacing that of the US since 2018 by ~58%.
Our partner, Coalfield Development, is a nationally recognized non-profit organization working to rebuild the Appalachian economy from the ground up by incubating social enterprises to create new jobs and development opportunities for people facing barriers to employment. Their most recent venture, the Highwall project, is in West Virginia’s southwestern region known as Mingo County. This region has not experienced the same boost in tourism as the rest of the state due to it’s remote location and mountainous terrain. Highwall has been developed with substantial local community engagement and support and is meant to provide high end accommodation for families traveling to the region to take advantage of the famous Hatfield McCoy Trails System, local history and beauty. This facility will also provide recovery groups and residential treatment programs a unique destination that reframes a stunning post-extractive landscape into a vista of opportunity and renewal, displaying what is possible in areas like southwestern West Virginia through entrepreneurial grit and gumption.
What was the problem?
Coalfield Development asked the team to provide both an analysis of the tourism landscape in Mingo County and evaluate potential auxiliary businesses that would be attached to the Highwall project. Despite the increasing growth in tourism in West Virginia, bringing tourism to Mingo County presents several challenges:
Infrastructure: Mingo County is situated among 11 named mountains. While these mountains bring undeniable beauty to the County, they also pose a threat. The mountains negatively affect cell service and steady internet. An article in Mountain State Spotlight found that ~40% of homes and businesses in Mingo and Logan counties (around 13,000 people) do not have access to the internet with data speeds sufficient to meet the Federal Communication Commission’s definition of “high-speed.” Due to pandemic shutdowns, parents have been driving their school-aged children upwards of 40 minutes to access new internet hotspots installed in town. Additionally, the closest airports are nearly two hours away, making access to the region particularly difficult.
Declining Labor Market: According to the US Census Bureau, 42% of Mingo County residents older than 16 years of age participate in the civilian labor force. Only 51% of the population is working age, and this segment is declining. Less than 10% of the labor market has a bachelor’s degree. Coalfield’s Highwall project is uniquely positioned to offer education and service training experience to members of the local community.
Community Support and Engagement: As we imagine Highwall as a place to bring together the local community with tourists, two demographics must be balanced as they work together to make Mingo County a desirable, sustainably focused destination. Locals who are involved in the mining industry sometimes mistrust sustainable ventures as goals related to sustainability often are at odds with their livelihoods.
What did we do?
Our initial research took a deep dive at understanding the social, political, economic, and infrastructural fabric of West Virginia and specifically, Mingo County. We met weekly with the key stakeholders at Coalfield to understand and address their challenges and form hypotheses. While in the field, our team was able to stay on-site at Highwall and put our hypotheses to the test. We met with business owners, government officials, and local community members to better understand the sentiment towards a tourism landscape in the region, and feasibility of building out a tourism ecosystem in the Hatfield-McCoy region. Along the way, we collected data and consulted industry experts to explore potential market gaps in the business landscape.
What was the turning point?
As we interviewed local business stakeholders in the area, we came to understand three of the key barriers to a thriving tourism ecosystem. First was a lack of appropriate talent to properly staff resorts and restaurants in the area. Second, was a lack of businesses that provide entertainment services beyond overnight stays or food, affectionately known to the locals as “other stuff to do.” Third, was a financial barrier. The local financial institutions traditionally cater to the needs of coal companies and are not as comfortable taking the risk on local entrepreneurs as similar banks would be in more developed marketplaces. If one is able to secure some debt financing, he/she is usually saddled with extremely high interest rates.
What was the recommendation?
Customer targeting through data analytics
As we came to understand Coalfield’s vision for the project, we were able to perform market research to understand who their target customer should be. The ideal potential customer for Highwall is a younger family unit consisting of a married couple, who have children over the age of one, in the upper half of income brackets, living within a six-hour drive of Highwall with an interest in the outdoors, ATV-ing, eco-tourism and camping. __After identifying the target demographic, the team outlined the key data points that Coalfield could use to connect with them as well as a framework on how to collect this data, as well as how to best build out the property to accommodate this customer.
Entrepreneurial support through workforce development
Speaking with local business owners and members of the community reaffirmed the need for strong entrepreneurial support across all aspects of starting a business. Although many community members expressed a need for more restaurants, nightlife, and non-ATV activities, not many have pursued the opening those types of businesses. Anecdotal evidence suggests that the community struggles with either a lack of resources or awareness of existing resources, as well as mentorship and access to capital. There is a misconception that hospitality jobs are primarily low-wage positions with little financial security or upward mobility – this mindset needs to be corrected with education and training. Coalfield is extending its investment in the region by revitalizing a building in downtown Matewan, the nearest town to Highwall. We recommend Coalfield leverage this central presence in the community to establish a network for entrepreneurial development and support.