Putting the App In Ap­palachia

With coal col­laps­ing, Ken­tucky min­ers are learn­ing to code “We’ve got a lot of high-skilled hill­bil­lies here”

Bloomberg Businessweek (Asia) - - TECHNOLOGY - −Tim Loh

Be­fore cut­backs took his job, Jim Ratliff worked 14 years in the mines of east­ern Ken­tucky, drilling holes and blast­ing dy­na­mite to ex­pose the coal that’s pow­ered Ap­palachian life for more than a cen­tury. To­day he rolls into an of­fice at 8 a.m., set­tles down at a small desk, and be­gins tap­ping at a key­board.

In the past year he’s gone from know­ing “ab­so­lutely zero about com­puter code” to be­ing a pro­fes­sional pro­gram­mer. “A lot of peo­ple look at us coal min­ers as un­e­d­u­cated,” says Ratliff, a 38-year-old with a thin goa­tee and thick arms. “It’s back­break­ing work, but there’s en­gi­neers and very so­phis­ti­cated equip­ment. You work hard and ef­fi­ciently. And that trans­lates right into cod­ing.”

Ratliff works for Bit Source, a startup in his home­town of Pikeville that builds web­sites and apps for clients in the area. The com­pany is out to prove that in the hills there can be life af­ter coal. Thou­sands of lo­cal work­ers are among the 26,000 Amer­i­cans left un­em­ployed as coal prices fell 75 per­cent over five years. About 1,000 peo­ple ap­plied for Bit Source’s first 10 cod­ing jobs, says co­founder Rusty Jus­tice. All have min­ing back­grounds. “We’ve got a lot of high­skilled hill­bil­lies here,” he says.

Few places are as steeped in coal as Pikeville, a town of 6,900 wedged into a nar­row slice of the Big Sandy Val­ley. Over the years, sur­round­ing Pike County has set state records for mil­lions of tons dug. Since the coal slump, its out­put has fallen below 7 mil­lion tons, a fifth of its peak, and min­ing jobs have dropped by two-thirds, to fewer than 1,300.

Jus­tice, a fourth-gen­er­a­tion Pikeville na­tive, felt the pinch. His ex­ca­va­tion and en­gi­neer­ing com­pany, Jig­saw En­ter­prises, lost 70 per­cent of its cus­tomers as big min­ers such as James River Coal, Al­pha Nat­u­ral Re­sources, and Arch Coal filed for bank­ruptcy pro­tec­tion. Jus­tice be­gan look­ing to di­ver­sify.

In 2014 he and busi­ness part­ner M. Lynn Par­rish set up Bit Source in an old brick Coca-Cola bot­tling plant on Pikeville’s north­ern edge. Last win­ter they be­gan their re­cruit­ing drive, air­ing ra­dio ads and post­ing fliers seek­ing un­em­ployed coal work­ers in­ter­ested in be­com­ing pro­gram­mers. Start­ing salaries for coders liv­ing three hours west of Pikeville in the “Golden Tri­an­gle” of Louisville, Cincin­nati, and Lex­ing­ton top out at about $70,000—com­pa­ra­ble to min­ers’ wages. Jus­tice says he fig­ured the tran­si­tion would be easy enough. “Dag­gone,” he says. “Th­ese are high­tech work­ers that just get dirty.”

Ratliff, who spent years in the mines cal­cu­lat­ing par­ti­cle ve­loc­i­ties and ex­plo­sion den­si­ties, says that back­ground helped him pass Bit Source’s in­ter­views and tests. Last March he joined the nine other new hires, who’d driven un­der­ground shut­tle cars or sold heavy min­ing ma­chin­ery.

A $154,000 grant Bit Source got from a re­gional jobs pro­gram paid their salaries dur­ing five months of train­ing while they learned HTML, JavaScript, and PHP. Since then they’ve com­pleted nine projects, in­clud­ing the web­site for east­ern Ken­tucky’s ca­reer cen­ter net­work. While fed­eral funds are still cov­er­ing a share of Bit Source’s pay­roll through the win­ter, Jus­tice says he ex­pects to turn a profit this year.

Bit Source is an out­lier—Big Sandy Val­ley isn’t Sil­i­con Val­ley. Ken­tucky has the slow­est In­ter­net speeds in the U.S., ac­cord­ing to a sur­vey by Aka­mai Tech­nolo­gies. Al­most a quar­ter of the state’s ru­ral pop­u­lace has no broad­band op­tion. Ken­tucky Wired, a $324 mil­lion pub­lic-pri­vate part­ner­ship, is sup­posed to lay 3,400 miles of fiber-op­tic ca­ble across Ap­palachia and the rest of the state by 2018, but the pro­ject is al­ready fac­ing a fi­nan­cial short­fall.

Slow change is still change, Ratliff says. Dur­ing the five months he was out of work, start­ing in late 2014, he trav­eled as far as Wy­oming look­ing for a job be­fore de­cid­ing he had to re­turn to his three teenage kids. At Bit Source, he’s mak­ing half what he made in the mines, but prospects are bright enough that he turned down an of­fer to re­turn to coal. Ratliff fol­lowed his dad into the mines when he was just a few years older than his old­est child is now. Re­cently, he sat down with the kids to sug­gest they be­come pro­gram­mers. “The coal in­dus­try is dy­ing here,” he says. “But we could be the grass roots of some­thing truly spe­cial.”

The bot­tom line A coal-in­dus­try ex­ca­va­tor has trained out-of-work min­ing ex­perts as coders and says the com­pany he co-founded is near­ing a profit.

Ratliff

Jus­tice

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