2017 Regional Report: The Southwest

Tech migration is bringing jobs and economic growth to southwestern states.



As a small, rural state known for its agriculture industry, Arkansas is rapidly broadening its economy to one of technology and innovation. The state has seen a number of high-profile corporate headquarters relocations and investments in recent years as companies continue to leave high-cost places like San Francisco, Boston and Silicon Valley.

Walmart, headquartered in Bentonville, Arkansas, has also been expanding its presence. Mike Preston, executive director of the Arkansas Economic Development Commission, says the area has seen rapid population growth in recent years. While 14,000 people are employed at Walmart’s headquarters, tens of thousands more work in the region for suppliers and vendors like Kraft, Tyson, Nestle and P&G. Over the past decade, the activity has also given birth to a robust IT sector fueled by such companies as Tata Consultancy, Cognizant and UST Global. Preston says strong educational initiatives and a growing tech workforce have also attracted other companies like Metova, Big Cloud Analytics and Eyenalyze.

“We’ve started seeing more interest from data- and software-related companies by educating for a new generation of jobs.

In 2015, Gov. Asa Hutchinson introduced initiatives to build awareness about the STEM fields, and signed a bill mandating that every public high school in the state offer computer science classes. “We’ve started seeing more interest from data- and software-related companies by educating for a new generation of jobs,” says Preston.

Boston-headquartered software engineering services provider Elyxor, which serves global clients in healthcare, fintech and e-commerce, recently added 45 software engineering specialists to its growing office in Little Rock. Elyxor Chief Strategy Officer Rob Lentz says the company was located in Arkansas to capitalize on the talent pool. He says while they explored multiple locations in the Midwest and South, the incentives and the skilled labor force combined with low cost of living offer a strong value proposition.

“In a market like Boston, you’re competing with everyone. We can come [to Little Rock] and be the best. We can have a bigger influence and get the best talent in town,” says Lentz. Preston says the state is also seeing “significant investment” from China. Suzhou Tianyuan Garments Company recently announced a $20 million investment in a manufacturing facility in Little Rock with 400 jobs. Shandong Sun Paper Company is also investing $1.3 billion in a paper goods manufacturing plant.

One of the biggest assets attracting CEOs to the state is that it’s “small and flexible,” says Preston, who says the state government can work and negotiate quickly to make larger projects feasible with greater incentives, flexibility and concessions. “If you run into an issue or regulation you’re having a problem with, you’ will get a call back and we’ll move mountains to make sure a company is happy doing business here.”



The announcement by Facebook in September 2016 that it would build a massive data center in Los Lunas has sparked a wave of excitement in the state. The social media company said in a statement that the facility will be one of the most advanced energy-efficient centers of its kind in the world. Economic development leaders and CEOs from around the state are hailing it as a “big deal” that significantly raises New Mexico’s prominence on the radar of tech development. Greater Kudu, the company originally launched to build the data center, said in its industrial revenue bond application that large data centers often have a “follow the leader” effect.

“When Facebook looks at dozens of potential locations and says New Mexico is the best for their investment, I think that speaks clearly to CEOs.

“When Facebook looks at dozens of potential locations and says New Mexico is the best for their investment, I think that speaks clearly to CEOs,” says Gary Tonjues, president of Albuquerque Economic Development. The deal required substantial investment from the state and Los Lunas, including industrial revenue bonds, a $10 million Local Economic Development Act measure and the promise to grant the company a monthly reimbursement of the town’s share of gross tax revenues. The state also offered up to $3 million in Job Training Incentive Program funding. What worked in the Facebook deal could be a model for future investments.

Terri Cole, president & CEO of the Albuquerque Chamber of Commerce, says the Facebook deal has set the region “on fire” and offers the potential to create what she says could  soon be “another Silicon Valley.”


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