Spring 2010

For more information on economic development in the South, go to www.SB-D.com, www.SouthernAutoCorridor.com and www.SmallTownSouth.com.

Toyota Moving Ahead with Mississippi Plant

In mid-June, officials with Toyota Motor Corp. announced the automaker will finish construction on its assembly plant near Tupelo, Miss. after the facility was mothballed at the height of the recession in December of 2008. The company broke ground on the $1.3 billion, 2 million-square-foot plant in April of 2007. Toyota planned to build Highlander model SUVs at the facility, but soaring gas prices nixed that plan. The company then announced it would build the fuel efficient Prius at the northeast Mississippi facility in the summer of 2008. Less than six months later, one of the worst automotive markets in U.S. history was in full swing and the plant was delayed indefinitely. Toyota plans to build the Corolla model at the Tupelo plant after equipment is installed and improvements to the facility are made. The company closed its California facility it shared with GM earlier this year. That plant produced about 150,000 Corolla models and most of that production was then moved to Japan. Toyota officials plan to tool the Mississippi plant with used equipment and furnishings from other plants in North America, a move that will save the company about $500 million. Production in Mississippi is set to begin in the fall of 2011. Toyota expects to hire 2,000 workers at the Tupelo auto works. 

Mass Layoff Events Drop Dramatically in the South

A sign that the South's economy has recovered from the Great Recession while other parts of the U.S. continue to struggle can be found on the Bureau of Labor Statistics Web site. In April of 2009 there were 2,663 mass layoff events in the U.S., the third-highest total in the recession, behind only May 2009 and March 2009. Of those, 696 were from companies that operated in the American South, or about 26 percent of all mass layoffs announced in the U.S. in April 2009. One year later, there were 1,856 mass layoffs in the U.S., of which only 369 were in the American South. So, in April of 2010, only 20 percent of all mass layoffs in the U.S. were in the South even though the region is home to 40 percent of the U.S. population.

Mass Layoffs in the South by State

State	April 2009	April 2010
AL	27	17
AR	12	8
FL	152	118
GA	50	31
KS	7	5
KY	83	40
LA	27	32
MD	12	6
MS	15	5
MO	46	28
NC	28	13
OK	14	5
SC	60	19
TN	35	18
TX	74	73
VA	42	15
WV	12	4
Total	696	369

Source: Bureau of Labor Statistics

Samsung Investing $3.6 Billion in Austin Plant

In mid-June, South Korea-based Samsung announced plans to begin a $3.6 billion expansion of its Austin Semiconductor's 12-inch fabrication plant in Austin, Tex. The Austin complex houses the company's only semiconductor manufacturing plant located outside Korea. The investment in the Austin campus will build out the second phase of the company's 2.3-million-square-foot complex. The first half of the building was started in 2006 and began production a year later, after Austin won out over Albany, N.Y. and was awarded the facility. The 12-inch plant was built in 2007. An older fabrication plant, which produced chips on 8-inch wafers, was closed in 2009 and refurbished for copper processing for 12-inch fabrication. The new facility, which is dedicated to front-end fabrication of advanced 45 nanometer logic process technology and beyond, is expected to be completed by the end of 2011. Samsung started in Austin in 1996, when it began construction of its first plant. In total Samsung has invested more than $9 billion at its facilities in Austin, one of the largest foreign investments in a single market in the South.

Machinist File Complaint against Boeing over South Carolina Plant

In June the Machinists union in Washington State filed an unfair labor complaint against Boeing with the National Labor Relations Board, charging that the decision the aerospace giant made to place a 787 assembly plant in North Charleston, S.C. was in retaliation for a 2008 strike. The complaint notes that the National Labor Relations Act states that it is illegal to retaliate against union workers for engaging in lawful activities such as strikes. The Machinists union went on strike against Boeing for two months in the fall of 2008, its fourth strike in 10 years at Boeing's facilities in the Puget Sound. The complaint has been turned over to the National Labor Relation Board's Seattle office. On October 28, 2009, Boeing announced it had chosen a site at the Charleston International Airport over existing facilities in Washington State for a new $750 million, 4,000-employee 787 assembly plant.  

Double Whammy for Louisiana's Oil Spill Job Losses

The oil disaster in the Gulf of Mexico has paralyzed Louisiana's seafood industry, affecting over 20,000 fishery jobs in the state. On top of that the suspension of work at 33 deepwater drilling operations in the Gulf of Mexico could affect up to 20,000 jobs in Louisiana if rig operators move their platforms to other waters outside the U.S. Of the 33 rigs that were ordered to temporarily shut down shortly after the spill occurred, 22 are located off the coast of Louisiana. Louisiana Economic Development Secretary Stephen Moret told the Times Picayune newspaper in New Orleans that up to 20,000 Louisiana jobs could be lost by a drilling moratorium. On June 22, New Orleans U.S. District Judge Martin Feldman granted a preliminary injunction, halting the deep water (below 500 feet) drilling moratorium imposed by President Obama after the spill.

CEOs Rate Texas as No. 1 for Business

Texas has been ranked the top state for job growth and business development for the sixth consecutive year by Chief Executive Magazine. The survey asked 651 CEOs to rank each state on three general categories: taxation and regulation, quality of workforce and living environment. Other states in the South that made the ranking's top 10 were North Carolina (2nd), Tennessee (3rd), Virginia (4th), Florida (6th), Georgia (7th) and South Carolina (10th).

Georgia Delegation Visits Cuba

Georgia Gov. Sonny Perdue led a 43-person Georgia delegation on a business mission to explore trade opportunities with Cuba. The group left Atlanta for Havana Sunday, June 6 and returned Tuesday June 8. The mission focused on opportunities in agriculture, medical and the telecommunications industries.

Pentagon Officially Designates Fort Meade as U.S. Cyber Command

In the spring quarter, The Pentagon officially designated Fort Meade, Md. as home to the new U.S. Cyber Command, a consolidation of computer defense operations that will bring 1,000 military jobs and many more civilian workers to Maryland. Maryland Gov. Martin O'Malley said in a statement that the total command is expected to exceed 21,000 soldiers and civilians. Investment in the new cyber security program is estimated to be up to $30 billion (that's with a "B") in the first five years.

Texas Manufacturing Hits 3-Year High

A report published in June by the Federal Reserve Bank of Dallas showed that the Texas production index, which measures the state's manufacturing production, climbed to its highest level in three years in May. According to the Federal Reserve, Texas accounts for 9.5 percent of all manufacturing in the U.S., behind only California. 

EUE/Screen Gems Opens Studios in Atlanta

EUE/Screen Gems opened a studio complex in the former Lakewood Fairgrounds site near midtown Atlanta. The new studio targets film, television and digital production communities and commercial agencies in the U.S. and other countries as clients. EUE/Screen Gems is currently undertaking a multi-million dollar phased renovation of the property.

Florida Passes New Film and Entertainment Incentives

The State of Florida passed a new film and entertainment incentive which went into effect July 1. The revamped incentive program creates a fund totaling $242 million to be used to recruit film makers over five years. Over $53 million in transferable tax credits will be authorized for distribution during the 2010-2011 fiscal year. Qualified projects, including digital media, will receive returns of 20% to 30% for qualified Florida expenditures.

DreamWorks to Film Major Motion Picture in Greenwood, Miss.

Officials with DreamWorks Studios have announced plans to film "The Help," a motion picture based on Kathryn Stockett's best-selling novel of the same title, in Mississippi. The majority of the filming will take place in rural Greenwood, Miss. and the surrounding area. During the six month production period, about 150 cast and crew members will be living and working in Greenwood and Leflore County. Production on the film will begin this summer.

Washington Think Tank Ranks Metro Economies

Brookings recently published its MetroMonitor report revealing the 21 strongest-performing U.S. metro economies. In Brooking's top 10 were Augusta, Ga., Austin, Tex., Baton Rouge, La., Columbia, S.C., Dallas/Fort Worth and El Paso in the South. In the second 10 were Houston, Jackson, Miss., Little Rock, McAllen, Tex., Oklahoma City, San Antonio and Tulsa. Albany, N.Y. was No. 1.

Unemployment in the South a Full Point below U.S.

In May, the unemployment rate in the U.S. (pop. 309,472,354) dropped to 9.7 percent, with 15 million persons unemployed. Of those, about 5.3 million people were unemployed in May in the American South (pop. 118,654,723). The South's unemployment rate in May 2010 stood at 8.7 percent.

Unemployment Rate and Total Unemployed Persons in Southern States

	*rate	# of Unemployed
AL	10.3	215,600
AR	7.5	102,200
FL	11.2	1,032,900
GA	9.8	460,800
KS	6.3	94,900
KY	10.2	211,300
LA	6.2	128,900
MD	6.9	202,100
MS	10.7	137,200
MO	8.8	262,700
NC	10.0	455,000
OK	6.3	111,000
SC	10.4	225,000
TN	10.3	310,000
TX	8.1	989,600
VA	6.7	279,400
WV	8.9	69,800
Avg.	8.7	5,288,400

*May 2010 Source: Bureau of Labor Statistics

Austin and Raleigh make Forbes Ranking

Austin was ranked No. 2 on Forbes.com's "most innovative” cities ranking that was published in the spring and Raleigh was ranked No. 3. No other Southern markets made the magazine's top 10. Topping the most innovative cities ranking was San Jose, Calif., and San Francisco, Seattle, San Diego, Madison, Wis., Boston, Provo and Portland all made the top 10.

Tulsa is Nation's Best Housing Market

According to the Metropolitan Policy Program at Brookings, Tulsa, Okla. was the only market of the 100 largest U.S. metropolitan areas where home values did not decline between the fourth quarters of 2008 and 2009. The report showed that Las Vegas remains the worst housing market in the U.S., with a decline of 20.8 percent. 

New Airport Opens in Northwest Florida

The Northwest Florida Beaches International Airport, the first commercial airport built in the U.S. in the past 15 years, officially opened for business May 23. The new airport, which replaces the Panama City-Bay County Airport, was built on 4,000 acres that The St. Joe Company donated in 2007.

Dell Opens Army Service Desk in Oklahoma City and Nashville

Dell opened two Army Enterprise Service Desks at Oklahoma City and Nashville in the spring quarter. The projects created about 100 jobs at each location. The service desks will provide customer support to some 2.4 million users globally, including active duty Army personnel, National Guard, Reserves, DA civilian and select contractor workforce having an Army Knowledge Online (AKO) account that grants access to Army web assets, tools and services worldwide.

Automotive Industry Deals Surge in the South

Projects related to the automotive industry have surged to levels not seen in at least 24 months in the Southern Automotive Corridor. For a while there, SB&D had trouble filling two pages of news from the South's automotive industry. It's been slim pickings on the automotive news front as far as new or expanded projects over the last couple of years. As if on cue, the automotive industry is raging back in the South as folks finally trade in their clunkers for new and improved wheels. Check out four pages of news courtesy of SouthernAutoCorridor.com beginning on page 26. 

Very Strong April in the American South

Following an impressive number of job-generating deals in March, the number of companies announcing projects of 30 jobs or more jumped even more dramatically in April. Southern Business & Development counted 242 significant job generating projects (30 jobs or more) in April, compared to 133 in March, and only 81 in January and February combined. Automotive, general manufacturing and food processing led all industry sectors in the number of projects in the South in April. 

Tennessee Rural Opportunity Fund Wins Award

The Tennessee Rural Opportunity Fund, a $10 million economic development fund providing loans to small businesses in rural Tennessee, has been awarded the 2010 National Community Reinvestment Award from the Federal Financial Institutions Examination Council. The award recognizes the work of financial institutions that are advancing innovative solutions to the challenges facing lower-income and distressed communities. The Tennessee fund is a public-private partnership between the state of Tennessee, 23 member banks of the Tennessee Bankers Association and Southeast Community Capital Corp. Launched in 2007, the Rural Opportunity Fund is expected to generate $25 million in loans and finance over 350 small, minority and women-owned businesses in small town Tennessee over 10 years. For more information on economic development in the rural South, go to www.SmallTownSouth.com.

Super Site Certified in Kentucky

Kentucky Gov. Steve Beshear announced in the spring quarter that the 1,551-acre industrial site in Glendale, Ky. has been certified as a CSX Megasite by McCallum Sweeney Consulting (MSC). The Glendale site joins a list of less than 15 industrial sites pre-certified for immediate development by MSC.

Eight of Ten-Lowest Cost of Living States in the South

Eight of the nation's ten-lowest cost of living states are locating in the South according to ACCRA's 4th quarter 2009 report. Oklahoma was the state with the lowest cost of living according to the report. Oklahoma was followed by Tennessee, Arkansas, Kentucky, Kansas, Nebraska, South Dakota, Texas, Missouri and Georgia.

Huntsville Named No. 1 Place to Live by RelocateAmerica

In the spring quarter, RelocateAmerica.com ranked Huntsville, Ala. as the top U.S. city to live in. Huntsville was followed by Washington, D.C., Austin, San Diego, San Antonio, Tulsa, Charlotte, Raleigh, Boulder and Minneapolis.

Atlanta Airport Project Requiring another 1,000 Workers

The new international terminal being built at Atlanta's airport will require another 1,000 construction workers within the year, nearly doubling the number of workers at the site to 2,100. The airport is spending about $30 million a month on the new terminal which is expected to open in April 2012.

Maryland, West Virginia Personal Income Jumps are No. 1 in U.S.

According to the U.S. Bureau of Economic Analysis, Maryland's personal income rose from $272.5 billion in 2008 to $275.2 billion in 2009. The nearly $2.7 billion increase was the largest dollar increase in the country. Maryland was one of only six states to earn a personal income gain last year and four of those were in the South: Maryland, West Virginia, Virginia and Kentucky. West Virginia saw the largest gain in per capita personal income with 1.8 percent. Wyoming, Florida, New York, Connecticut, Michigan, Arizona and Nevada were states that saw the largest decrease in personal income.
 
Universities in the South Dominate BusinessWeek Ranking

In the spring quarter, BusinessWeek ranked universities in the U.S. based on which business programs give students their biggest return on their tuition dollar. They did it by comparing annual tuition costs with median starting salaries for graduates. The top four schools were in Florida, eight of the top 10 were in the South and 15 of the top 25. The top five business schools based on ROI according to BusinessWeek are the University of Central Florida (Orlando); University of Florida (Gainesville); Florida International (Miami); Florida State (Tallahassee); and North Carolina (Chapel Hill).

Film Incentives Working in Arkansas

Arkansas' new incentives for film makers who film in the state have generated six new projects. The six projects are in the final approval stages for a 15 percent rebate film crews receive and another 10 percent rebate for Arkansas workers hired on the crews. Currently film maker Harry Thomason is shooting "The Last Ride" in Arkansas. The movie, with a budget of $2 million, is about the final three days of the life of country music singer Hank Williams Sr. Thomason expects to receive $300,000 in incentives from the state of Arkansas as a result of filming the movie in the state.

Mississippi Poultry Company a Major Economic Force in Eastern North Carolina

Mississippi-based Sanderson Farms, which is building a $121 poultry processing plant in Kinston, N.C. that will employ 1,500 workers, announced in the spring it is considering adjacent Wayne County, N.C. for another $94 million chicken plant that could employ up to 1,100 workers. The surge in chicken processing is a turnaround from two years ago when poultry producers postponed or cancelled projects because of soaring fuel and feed costs. For more information on rural South development, go to www.SmallTownSouth.com.

Maryland's First Wind Farm Breaks Ground

Constellation Energy has begun work on Maryland's first commercial wind farm, a 28-turbine project atop Backbone Mountain. Electric generation from the $140 million project is expected to begin by the end of the year.

Atlanta Airport Still the Busiest

In calendar year 2009, Hartsfield-Jackson International Airport remained the nation's busiest airport according to data recently released by the U.S. Bureau of Transportation Statistics. Atlanta topped all U.S. markets with 41.7 million passengers boarding U.S. airlines in 2009. Atlanta was followed by Chicago O'Hare, Dallas/Fort Worth, Denver and Los Angeles.

Deals at Deadline

In late June, KPMG announced it is bringing nearly 375 jobs to its office in Fairfax, Va. Seven new and expanding manufacturers announced projects in Northern Kentucky in late June. Combined, the companies will invest $28.4 million and create 404 new jobs in the region. LJT, a manufacturer of flat-rolled steel, announced it is investing $1.8 million and adding 84 new jobs in Chattanooga, Tenn. Clearwater Paper is building a new facility in Shelby, N.C.The tissue manufacturer will hire 250 workers for the project. Dad's Pet Care, a pet food manufacturer, announced in late June it is investing $10 million and adding 44 new jobs at its plant and warehouse in Dumas, Ark. The Industrial Development Authority of Halifax County, Va., and Dominion Virginia Power announced plans to develop an intiative to build a pilot demonstration facility for solar power generation and battery storage. The facility would generate about 4 megawatts of power and be the largest integrated solar battery facility in Virginia. Dominion estimates that they will invest up to $27.9 million on the project, which will create 100 construction jobs to build the facility. ArborGen, a biotechnology company focused on the science of forestry, announced it will expand its global headquarters to a new 13.5 acre campus in Dorchester Co., S.C. The $14.5 million facility will house labs, production and administrative functions as well as a 35,000-square-foot greenhouse.

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