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Whirlpool Expansion Keeps Arkansas Cool
Southeast Oklahoma Snares New Investment
P&G, GM Counter Louisiana Trend
Huge HQ Projects
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SOUTH CENTRAL STATES REGIONAL REVIEW
Landing The Big One
The South Central states already boasted a
logistical advantage for a wide variety of corporate
facilities. When Toyota came calling, San Antonio rose to the top.
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nchoring the bottom half of a U.S. map like so many jigsaw puzzle pieces, South Central states Arkansas, Oklahoma, Louisiana and Texas have the geographic pull firms like in siting factories, distribution centers and headquarters facilities. Offering logistical similarities, these states often compete for the same projects.
Several of them were in the running as Toyota Motor Manufacturing North America looked to site a new truck factory. And Toyota gave the Texas economy an early valentine with its Feb. 5 announcement of San Antonio as its preference for its sixth vehicle assembly plant in North America. With its eye on the lucrative truck markets of Texas and Mexico, Toyota selected a 2000-acre (809-hectare) site on the Alamo City's south side.
"Last night, we were very anxiously awaiting a call from Japan," said a tired-sounding but happy Mario Hernandez, president of the San Antonio Economic Development Foundation, the next day. "We were huddled in an office here with some Toyota officials and community leaders, and we got the call about 9 p.m."
Toyota Motor Manufacturing Texas will build approximately 150,000 Tundra full-size trucks annually, starting in 2006. The $800-million investment will create about 2,000 jobs with an annual payroll of about $80 million. A possible second phase of the operation could boost employment to 4,300.
Dennis Cuneo, Toyota senior vice president, cites a team effort by state and local officials, plus the creation of a new rail district to bring rail access to the site on San Antonio's south side, as major factors in his company's decision. Marion, Ark., was the runner-up in a search that examined several Southern states. The State of Texas is providing a $133-million incentive package, including $27 million for job training and recruitment and $15 million to build a second rail line to the plant.
The big news will be a big boost to a regional economy closely tied to the energy sector, and still reeling from the meltdown of Enron.
"Despite these problems, the environment is good," says Peter F. Ricchiuti, assistant dean of Tulane University's A.B. Freeman School of Business. "You can tell companies believe the economy is going to turn around. Oil service firms such as Halliburton generally have more employees than needed for this business level."
Oklahoma is the only one of the South Central states to be breaking in a new governor as 2003 cranks up. Democrat Brad Henry says his economic development policy will center on keeping companies in Oklahoma and helping them to expand. During his campaign, he was critical of the previous administration's efforts to court businesses around the world while firms were leaving the state.
A recent study of regional business costs by economy.com ranked Oklahoma among the 10 lowest-cost states for doing business.
While manufacturing and construction sectors remain weak in Arkansas, there has been slight improvement over the past year, according to John Shelnutt, senior research specialist at the University of Arkansas-Little Rock's Institute of Economic Advancement. Shelnutt says the state's economy is still contracting.
Huge budget deficits plague nearly every state in the Union. Texas has the highest deficit among South Central states with a current estimate of US$9.9 billion, ranking third in the U.S., according to the American Legislative Exchange Council (ALEC), which pegs Oklahoma's deficit at $1 billion and Louisiana's at $86 million. Arkansas is one of four states with a balanced budget.
As part of a $3.7-billion savings and revenue plan for the next biennium, Texas Comptroller Carole Keeton Strayhorn proposes eliminating the Texas Dept. of Economic Development (TDED) and bringing its functions to the governor's office. She bases this proposal on concerns raised by the Texas Sunset Advisory Commission, the Texas State Auditor's Office and the Texas Economic Development Council that TDED has been ineffective.
But when the usual entourage of automotive suppliers follow Toyota to San Antonio, Rylander's tone grows decidedly more positive -- she says the state could gain more than 16,000 jobs and $1.8 billion in investment in coming years.
Economists at Louisiana State University and Southeastern Louisiana University, in an annual study sponsored by Hibernia National Bank, project creation of 44,700 jobs in the state over the next two years. If that forecast holds true, the state will have 17 consecutive years of employment growth.
The study includes these predictions for 2003-2004:
• High energy prices will create resurgence in the oil and gas exploration sector, creating 1,300 jobs.
• Transportation equipment manufacturing will be a major job generator, spurred by new contacts with the U.S. Coast Guard and Navy.
• The city of New Orleans will add 12,800 jobs, primarily due to a multi-billion-dollar U.S. Coast Guard contract awarded to Northrop Grumman's Avondale Shipyard.
• Louisiana's 11 refineries will pump $1.1 billion into the state's economy to upgrade their plants to produce EPA-mandated lower-sulfur gasoline.
The Ports Association of Louisiana has launched a public awareness campaign promoting the economic prowess of the state's ports. A recent study by Tim Ryan, a University of New Orleans economics professor, indicates the state's ports have an annual economic impact of $32.9 billion and support 270,000 jobs.
Several of them were in the running as Toyota Motor Manufacturing North America looked to site a new truck factory. And Toyota gave the Texas economy an early valentine with its Feb. 5 announcement of San Antonio as its preference for its sixth vehicle assembly plant in North America. With its eye on the lucrative truck markets of Texas and Mexico, Toyota selected a 2000-acre (809-hectare) site on the Alamo City's south side.
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"Last night, we were very anxiously awaiting a call from Japan," said a tired-sounding but happy Mario Hernandez, president of the San Antonio Economic Development Foundation, the next day. "We were huddled in an office here with some Toyota officials and community leaders, and we got the call about 9 p.m."
Toyota Motor Manufacturing Texas will build approximately 150,000 Tundra full-size trucks annually, starting in 2006. The $800-million investment will create about 2,000 jobs with an annual payroll of about $80 million. A possible second phase of the operation could boost employment to 4,300.
Dennis Cuneo, Toyota senior vice president, cites a team effort by state and local officials, plus the creation of a new rail district to bring rail access to the site on San Antonio's south side, as major factors in his company's decision. Marion, Ark., was the runner-up in a search that examined several Southern states. The State of Texas is providing a $133-million incentive package, including $27 million for job training and recruitment and $15 million to build a second rail line to the plant.
The big news will be a big boost to a regional economy closely tied to the energy sector, and still reeling from the meltdown of Enron.
"Despite these problems, the environment is good," says Peter F. Ricchiuti, assistant dean of Tulane University's A.B. Freeman School of Business. "You can tell companies believe the economy is going to turn around. Oil service firms such as Halliburton generally have more employees than needed for this business level."
Oklahoma is the only one of the South Central states to be breaking in a new governor as 2003 cranks up. Democrat Brad Henry says his economic development policy will center on keeping companies in Oklahoma and helping them to expand. During his campaign, he was critical of the previous administration's efforts to court businesses around the world while firms were leaving the state.
A recent study of regional business costs by economy.com ranked Oklahoma among the 10 lowest-cost states for doing business.
While manufacturing and construction sectors remain weak in Arkansas, there has been slight improvement over the past year, according to John Shelnutt, senior research specialist at the University of Arkansas-Little Rock's Institute of Economic Advancement. Shelnutt says the state's economy is still contracting.
Huge budget deficits plague nearly every state in the Union. Texas has the highest deficit among South Central states with a current estimate of US$9.9 billion, ranking third in the U.S., according to the American Legislative Exchange Council (ALEC), which pegs Oklahoma's deficit at $1 billion and Louisiana's at $86 million. Arkansas is one of four states with a balanced budget.
As part of a $3.7-billion savings and revenue plan for the next biennium, Texas Comptroller Carole Keeton Strayhorn proposes eliminating the Texas Dept. of Economic Development (TDED) and bringing its functions to the governor's office. She bases this proposal on concerns raised by the Texas Sunset Advisory Commission, the Texas State Auditor's Office and the Texas Economic Development Council that TDED has been ineffective.
But when the usual entourage of automotive suppliers follow Toyota to San Antonio, Rylander's tone grows decidedly more positive -- she says the state could gain more than 16,000 jobs and $1.8 billion in investment in coming years.
Economists at Louisiana State University and Southeastern Louisiana University, in an annual study sponsored by Hibernia National Bank, project creation of 44,700 jobs in the state over the next two years. If that forecast holds true, the state will have 17 consecutive years of employment growth.
The study includes these predictions for 2003-2004:
• High energy prices will create resurgence in the oil and gas exploration sector, creating 1,300 jobs.
• Transportation equipment manufacturing will be a major job generator, spurred by new contacts with the U.S. Coast Guard and Navy.
• The city of New Orleans will add 12,800 jobs, primarily due to a multi-billion-dollar U.S. Coast Guard contract awarded to Northrop Grumman's Avondale Shipyard.
• Louisiana's 11 refineries will pump $1.1 billion into the state's economy to upgrade their plants to produce EPA-mandated lower-sulfur gasoline.
The Ports Association of Louisiana has launched a public awareness campaign promoting the economic prowess of the state's ports. A recent study by Tim Ryan, a University of New Orleans economics professor, indicates the state's ports have an annual economic impact of $32.9 billion and support 270,000 jobs.