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Regional Report: The Southeast

Workforce improvement is increasingly the new face of economic development.

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Diego Francisco, 46, an upholsterer at Lexington Home Brands in High Point, North Carolina, learned about the brand-new Catawba Valley Furniture Academy from a coworker last year. He quickly registered with the two-year, certificate-granting program. When he graduated, Lexington welcomed him back with a $4.50 hourly raise plus a status change that could add up to $10 an hour to his paycheck.

“I’m very glad I did this,” says Francisco. “I’d definitely do it again.” The Academy, organized by Lexington and four much-larger manufacturers in the furniture-manufacturing hub, is housed at the local community college. Its faculty is comprised of craftsmen and technicians from the five companies who teach high-demand sewing, cutting, upholstering and spring-tying skills.

The program came about because regional manufacturers were struggling to attract and retain skilled workers, often raiding each others’ labor forces. Furniture companies “weren’t getting the trained workers we used to get,” explains Bill McBrayer, human resource manager at Lexington. “People believed there was no future making furniture in North Carolina. They stopped learning the skills. We had to change that perception.” Manufacturers like Lexington say they need skilled workers more than ever, as quality and efficiency drive revenues.

All 67 members of the first graduating class have found jobs. Increasingly, workforce development is the new face of economic development. Companies weighing incentive packages often tip their decisions in favor of deals that provide skill training and STEM-based (Science, Technology, Engineering and Math-based) education to workers.

In Tennessee, a government initiative known as Tennessee Promise pulled 4,000 students into the state’s post-secondary pipeline, helping high school grads start skill-based training programs. The program, administered through a nonprofit called tnArchieves, helps finance tuition for state residents who want two-year degrees. Another Tennessee education-promotion program, Drive to 55, primarily helps older students enroll and complete baccalaureate programs. Its name refers to the goal of increasing the population of Tennesseans with college degrees to 55 percent by 2025. Currently, about 28 percent of state residents have sheepskins; nationally, the rate is about 32 percent. Both programs are funded by state lottery revenues.

Last year, the number of freshmen enrolled full-time increased 10 percent at public four-year programs, 20 percent at technical colleges and 24 percent at community colleges. “Our statistics indicate that our students are graduating at a rate three times the state average,” says Krissy DeAlejandro, head of tnAchieves. “We definitely believe the program’s working.” “Workforce development is economic development,” says Randy Boyd, Tennessee Economic Development chief. “It’s that simple.”


FLORIDA | #2 | FULL SPEED AHEAD

Florida created or retained over 21,000 total jobs in the 12-month period starting May 2015, led by financial and professional services, headquarters, manufacturing, life sciences and logistics/distribution. Major recent announcements include NBCUniversal Telemundo’s $250 million headquarters, Blue Origin’s $200 million launch facility and OneWeb’s $85 million satellite-manufacturing plant. Renovation and expansion are underway at Orlando, Miami and Tampa airports. The state’s manufacturing sales tax exemption, set to expire next year, was made permanent earlier this year.

This past spring, legislators voted down Gov. Rick Scott’s $250 million economic-development funding request, eliminating the discretionary fund that in past years had financed many incentive packages. At Enterprise Florida, the corporate-recruitment agency chaired by Gov. Scott, board members signed off in July on a $6 million cost-saving/restructuring plan that will lay off some two dozen workers. Meanwhile the search continues to replace former CEO Bill Johnson. The organization continues to promote the state to employers; in June, it was managing 380 expansion and pipeline-relocation projects.

In South Florida, a strong dollar and weakening South American economies continue to vex Miami-Dade and Broward counties. Macquarie Group’s decision to put a 120-employee global services headquarters in Jacksonville could spur further FinTech investments in that city.

About Warren Strugatch

Warren Strugatch
Warren Strugatch is a writer, speaker and consultant based in Stony Brook, NY. He covers economic development, global business, management and marketing.