National / International News
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When she was younger, Carolyn Rafaelian used to work in her dad’s jewelry factory as punishment if she misbehaved. Now, she and her sister run it.
“I love that factory smell,” she says, walking onto the factory floor. To her left are rows of waist-high cabinets, their drawers filled with beads. Some are yellow and orange like candy corns, others pink as grapefruit. To Rafaelian’s right, women sit at long tables, each working on a different task.
Alex and Ani founder and CEO Carolyn Rafaelian surveys vintage beads in the factory.Tracey Samuelson/Marketplace
Her dad started this factory in 1966, when Rhode Island was considered a global capital of jewelry manufacturing. During the 1980s, the state produced an estimated 80 percent of costume jewelry made in the U.S.
Much of that business has now moved overseas, but not Rafaelian. Instead of selling to wholesalers, who’d sell to stores, as her father had, Rafaelian launched her own line of jewelry called Alex and Ani, which specializes in thin metal bangles strung with charms. By 2009, the factory was making Alex and Ani products exclusively. In 2013, annual revenue hit $230 million (the company no longer releases revenue data).
“This is what you can’t find in China or anywhere else in the world, archives of stones,” Rafaelian says. “The sizes the shapes, the settings. They don’t even make this stuff anymore.”
The factory, Cinerama, holds drawers and drawers of vintage beads.Tracey Samuelson/Marketplace
Rafaelian insists that she can’t make her products in China — that part of their appeal is their story and their Rhode Island origins.
“There’s machines that would do it automatic, but that would probably take away 15 jobs, 20 jobs,” she says. “I like it this way. Everything’s being touched.”
But where she’s thrived, many other companies have folded. Rhode Island’s manufacturing sector, already struggling before the recession, is one reason economists believe the country’s smallest state has been one of the hardest hit by the economic downtown, as well as one of the slowest to return to pre-recession employment levels.
“Rhode Island’s manufacturing sector has essentially been cut in half in the past couple of decades,” says Gina Raimondo, Rhode Island’s governor. “We lost more than 80,000 manufacturing jobs.”
Governor Raimondo is just a couple months into the gig and very, very aware of the big structural problems her state’s economy faces. Like Rafaelian, Raimondo's dad also worked in the jewelry industry.
“My father made his career at the old Bulova watch factory in Providence,” she says. “At one time, Bulova employed over a thousand people. Those jobs are not coming back. My dad’s manufacturing, that is gone and I don’t see that coming back to America, much less Rhode Island.”
The jewelry and textiles and other labor-intensive products that Rhode Island historically made were more vulnerable to competition from China than other states, says Mary Burke, a senior economist with the Federal Reserve Bank of Boston who recently published a paper on Rhode Island's recession and recovery.
She says by 2000, “the manufacturing sector was doing very poorly and in a lot of ways, that was hidden by the housing boom because the housing boom was creating jobs in construction and retail, [as well as] boosting spending in a lot of other things.”
As the housing boom turned into a housing bubble, the national economy suffered. Burke says the impact was magnified in Rhode Island because it had larger housing price increases during the boom years and deeper declines during the bust than other states in the region.
During the recession, the state began earning the wrong kind of superlatives – its job losses were the worst in the region and it’s still 3.4 percent below its pre-recession peak in 2006. It had highest unemployment rate in the country for parts of 2013 and 2014.
But Burke says state’s economy is gradually recovering.
“It’s not going to happen overnight,” Raimondo says. “The decline has been over decades and it’s going to take time to turn the ship.”
To help make that turn, Raimondo recently proposed wide-ranging jobs plan, including everything from initiatives that seek to streamline the cost of doing business in the state to a new tourism campaign. She also wants manufacturing to play a role in the state’s future, but thinks the state needs to transition into high-tech manufacturing with better-paying jobs, even though she knows Rhode Island residents may not currently have the skills fill those positions. Another feature of her plan? Training programs — both for the jobs the state already has and the ones it hopes to create.
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Brian Chesky is the 33-year-old co-founder and CEO of Airbnb, a company that he says may very well be “the worst idea that ever worked.” The website allows users to rent rooms, apartments, houses, and even yurts from people they’ve never met, all around the world.
Chesky and his roommate and co-founder, Joe Gebbia, came up with the idea in 2007. The pair couldn’t make rent and needed to come up with an idea fast. Luckily, a design conference was in town, something the two RISD graduates knew a little something about, and all the area hotels had been booked up. Chesky and Gebbia inflated a few air mattresses and rented them out to three people — the first three Airbnb customers.
Photos of the first three Airbnb guests to stay in Brian Chesky and Joe Gebbia’s San Francisco apartment.Bridget Bodnar/Marketplace
Since then, the company’s grown rapidly. Chesky explained some of the company’s future plans while giving Kai Ryssdal, a tour of their San Francisco headquarters.
Chesky on whether Airbnb is a tech company, a hospitality company, or a social media company:
“I define the company as whatever the customer or person’s buying. I think our guests are buying hospitality. Now, I don’t think of us as a hospitality company the way these 100 year old companies are. In those ways, we look and feel a lot like a technology company. But I think we are a hospitality company powered by design and technology.”
On who Airbnb’s competition is, and isn’t:
“We are primarily a new form of travel. As we’ve grown, hotels have grown. Hotels have record occupancy rates. And a lot of people, when we launched, thought we couldn’t coexist. But we are fundamentally a different way to travel. People stay in Airbnbs almost twice as long so it’s almost like a whole new behavior.”
On making mainstream partnerships:
“We’re definitely leaning more mainstream … now we’re one of the official housing providers for the Rio Olympics next year.”
On criticisms about Airbnb’s effect on rent prices:
“I’m totally sympathetic to the complaints. Ultimately, we want to enrich the cities we’re in. When we launch, these other externalities happen. That being said, I fundamentally believe Airbnb is a really good thing for the city of San Francisco, New York, many other cities.”
The Airbnb offices consist of a mix of open work spaces and private conference rooms designed to look like real-life Airbnb rentals.Bridget Bodnar/Marketplace
On how long he plans to stay at Airbnb:
Chesky names two people he admires – Walt Disney and Steve Jobs. “I think really great entrepreneurs, they do one thing and that one thing is so significant that that’s how they’re remembered and that’s what they do for a very long period of time.”
Airbnb uses one wall in their office as a timeline for major events in the company.Bridget Bodnar/Marketplace
Earlier this month, Chesky was named one of TIME's 100 Most Influential People. His profile was written by Jonathan Ive, senior vice president of design at Apple.