Already home to some of the nation’s fastest-growing manufacturing and tech hubs, the Southeast is reaping the benefits of investments in educational and economic development initiatives. Alabama recently logged a record year of growth with thriving foreign direct investment. Tennessee lured Mitsubishi Motors, and a merger of giants in Georgia is solidifying the state’s status as a leader in payment processing. Florida is home to some of the country’s fastest-growing metro areas, while North Carolina attracts Fortune 500 headquarters with its strong workforce.
Note: Number is the ranking in the 2019 Chief Executive Best & Worst States for Business
No. 2* FLORIDA
Booming in Tampa
As one of the 10 fastest-growing regions in the U.S., the Tampa-St. Petersburg-Clearwater metropolitan area attracted 51,000 new residents in 2018 and nearly 300,000 between 2010 and 2017, according to the Census Bureau. The influx of talent and companies is spurring a wave of growth in many sectors, says Craig Richard, CEO of the Tampa Hillsborough Economic Development Corporation.
“The economic momentum is mind-boggling,” he says. “We have over 150 people moving here every day… We’re getting the attention of companies that are growing and expanding and weren’t here before. It’s a good time to be here.”
New regional construction projects include the $3 billion Water Street Tampa multiuse development, led by former Fidelity Magellan Fund Manager Jeff Vinik. In October of 2018, law firm Baker McKenzie announced a new global center in Tampa that will create 300 new jobs in legal services, finance, IT, operations and more. Fortune 500 mining company Mosaic also announced plans to relocate its headquarters to Tampa, and biotech giant Amgen opened a new “capability facility” there last year.
Tampa’s ongoing upgrading of infrastructure included new gantry cranes and expansions that created the largest deep-water port between the Panama Canal and the East Coast, Richard says. And a three-phase plan to expand the Tampa International Airport will enable it to accommodate up to 30 million passengers per year.
No. 3 TENNESSEE
Economic Benefits from Education
Education and workforce alignment have been top priorities in the Volunteer State, says Bob Rolfe, commissioner of the Tennessee Department of Economic and Community Development. The Drive to 55 initiative, which offers tuition-free community or technical college tuition to high school graduates, was extended in 2018 to all adults who do not already hold an associate or bachelor’s degree. “We want to demonstrate to companies that we are investing in the workforce that will be representing their brand, the products they make and the services they provide,” Rolfe says.
Those investments are paying off. Mitsubishi Motors announced in June 2019 it will invest $18 million to move its U.S. headquarters from Cypress, California, to Franklin, Tennessee. SmileDirectClub announced a $217 million expansion in Middle Tennessee that will create more than 2,000 jobs over the next five years. Volkswagen is investing $800 million and creating 1,000 jobs in Hamilton County to build its electric vehicles. And in November 2018, Amazon announced a $230 million investment and 5,000 new jobs at an “operations center of excellence” in downtown Nashville.
Rolfe notes the state has seen significant momentum in headquarters, financial services and IT-related fields. Companies that have expanded or established headquarters in the region since January 2018 include AllianceBernstein, ICEE, Western Express, CKE and Delek. “They may wonder what other companies are seeing in Tennessee and then begin to research how doing business in our state can benefit them…We are seeing the pipeline expand for companies considering Tennessee, particularly from the Northeast and West Coast,” Rolfe says.
No. 4 NORTH CAROLINA
Growth in Global Headquarters
North Carolina is now home to 12 Fortune 500 headquarters, including the Fortune 100 company Honeywell, which is moving from Morris Plains, New Jersey, to Charlotte. Advanced Auto Parts is also moving its headquarters from Roanoke, Virginia, to Raleigh, and, in February, BB&T and SunTrust announced a merger to form the sixth-largest bank in the U.S. with its headquarters located in Charlotte.
“North Carolina is without peer in supporting the talent and innovation needs of major global and domestic corporate headquarters, and these wins are further proof,” says Christopher Chung, CEO of the economic development partnership of North Carolina.
While the state has a diverse mix of economic growth, the life-sciences sector is especially strong with several new major announcements in the past year. Paris-based biopharm firm Cellectis announced in March it would establish its first U.S. commercial plant in Raleigh. Gene therapy company AveXis also announced in February a $60 million, 200-job expansion of its manufacturing facility in Durham County.
No. 8 SOUTH CAROLINA
Global Growth in the Palmetto State
A perennial manufacturing powerhouse, South Carolina set a record for total export sales for the ninth consecutive year in 2018. Top export commodities were vehicles and parts, aircrafts, nuclear reactors, boilers, machinery and parts. South Carolina now has a 16 percent market share of the entire U.S. passenger market, and top export countries include China, Canada, Germany and Mexico. “We’ve cultivated a globally connected economy in South Carolina, and last year’s export sales total reflects that,” said Secretary of Commerce Bobby Hitt in a press release.
Aerospace has been a particularly growing sector. French aerospace supplier AHG Fasteners-USA announced in June 2019 it will open a new U.S. operations in Charleston, citing the availability of skilled workers and proximity to Boeing as major factors in the location decision. “Not only is Charleston ideally suited as a distribution hub for both domestic and overseas customers, the business-friendly climate, the support from the regional economic development authorities and other partners have been extremely welcoming,” said Francoise Montsarrat, AHG executive vice president, in a press release on the opening.
AHG is the sixth company to locate in the region as part of the South Carolina Department of Commerce and Charleston Regional Development Alliances’ Landing Pad program, which supports global companies as they enter the U.S. market.
No. 10 GEORGIA
A Powerhouse of Payment Processing
The Peach State continues to grow as a leader in fintech. Payment processing firms located here now handle 70 percent of all U.S. transactions. In May 2019, Atlanta-based Global Payments and Columbus-based TSYS announced an all-stock merger of equals. The combined organization will provide payments and software solutions to more than 3.5 million businesses and 1,300 financial institutions in more than 100 countries. “The new company will have dual headquarters in Atlanta and Columbus and will create a true Peach State powerhouse,” says Patty Watson, senior executive vice president and CIO at TSYS.
Watson cited state help and TSYS programs for cultivating a talent pipeline. In addition to the work with local universities, the company’s TSYS Education Council introduces high school students to IT, computer science and software decoding. Since its inception in 2017, the council has established relationships with 13 high schools and 16 middle schools in the state, touching 8,000 students.
TSYS is now working on a reskilling initiative by partnering with online education training tool Pluralsight on in-house programs that have already been used by more than 3,500 team members in Georgia. “One of our greatest innovations is our ability to drive this technology change internally without outside consultants,” Watson says.
No. 13 VIRGINIA
Tech Talent Pipeline
The Old Dominion State is still making headlines for winning Amazon’s H2 headquarters, which will create more than 25,000 jobs over the next 12 years. Virginia won largely making partnerships, talent and long-term tech talent initiatives part of its plan, says Stephen Moret, CEO of the Virginia Economic Development Partnership, citing a $1.1 billion commitment to double the annual number of computer science graduates.
Virginia has seen several other prominent investments in the past year. In August 2018, Micron Technology announced a $3 billion expansion and 1,100 new jobs by 2030 to increase memory production at its Manassas facility. Merck is also investing $1 billion over the next three years to expand manufacturing operations in Rockingham County, and Hershey will invest $104 million in its facility in Augusta County.
One challenge the state now faces is extending the economic success to more rural regions. Recent funding for site characterization and a $250 million broadband expansion initiative aim to help. The newly formed Rural Virginia Initiative will also combine representatives from education, government and the private sector to analyze the issues and propose recommendations.
No. 23 KENTUCKY
Growing its International Profile
Kentucky is building on record-breaking investments in recent years by raising its profile on the global scale with deepened relationships with Japan and Europe, and a new focus on China and India. “We are putting significant emphasis on recruiting investment and jobs internationally,” says Erran Persley, commissioner for business development at the Kentucky Cabinet for Economic Development.
Recent prominent investments include GM adding 400 jobs at the Bowling Green Assembly Plant, and Toyota’s planned $238 million investment in expanding its Georgetown facility. Amazon also recently broke ground on a $1.5 billion Amazon Air Hub at the Cincinnati/Northern Kentucky International Airport, which is expected to open in 2021 and will support 2,700 jobs.
Hemp is another growing sector for the Bluegrass State. Federal legalization in late 2018 fueled demand for CBD oil and related products. The Kentucky Department of Agriculture reported sales of hemp products grew by more than 300 percent from 2017 to 2018, earning farmers in the state more than $57 million.
No. 25 ALABAMA
Economic Harvest in the Cotton State
Alabama logged record growth in 2018 with 71 projects and 286 expansions worth $8.7 billion in capital investment. Roughly half of that was direct foreign investment from companies in 16 countries, including South Korea, Japan, Germany and Canada.
Auto manufacturing remains a top sector in the state, and the $1.6 billion Mazda-Toyota manufacturing facility in Huntsville is moving forward with a targeted production date in 2021. New initiatives in economic diversification are also yielding wins in other sectors. Facebook announced in June 2018 it will bring 100 highly technical jobs to the Huntsville area, and Mercedes Benz broke ground on a factory in Tuscaloosa to build EV batteries for its next generation electric vehicles in October 2018. Shipt, a same-day, app-based delivery service founded in Birmingham, was acquired by Target last year for $550 million.
The diverse economic growth is partly being driven by Accelerate Alabama, a strategic economic development plan continually being updated with refined targets and tactics. “I believe you need a strategic plan that is vibrant and current,” says Greg Canfield, Secretary of Commerce for the State of Alabama. “We launched in 2012, updated in 2016 and will probably refresh in 2020.”
A new rural development office will focus on fostering growth in rural areas through long-term infrastructure issues such as transportation, high speed data service, bandwidth and workforce development, says Canfield.
No. 30 LOUISIANA
Big Developments in the Bayou State
Louisiana is fostering greater tech growth with higher education investments that will produce more grads with STEM-related advanced degrees, says Don Pierson, secretary of the Louisiana Economic Development. To date, the state has invested more than $286 million to advance curriculum and training. “Louisiana’s higher education initiatives with technology and advanced manufacturing employers have been a real game-changer,” Pierson says.
In total, more than 20,000 new jobs have resulted from specific projects tied to higher education partnerships. DXC Technology announced last year it will create more than 2,000 jobs over five years at its Digital Transformation Center in New Orleans. In May 2019, Cybint Solutions launched a partnership with Bossier Parish Community College to build a $22 million cyber center. And Grambling State University recently became the first college in the state to offer a bachelor’s degree in cybersecurity.
Louisiana is also capitalizing on the shift in the global LNG market and has taken a prime position in the industry with Cheniere’s Sabine Pass and Sempra’s Cameron LNG projects, Pierson says. Venture Global is also proposing multi-billion-dollar projects at the eastern and western ends of the state’s Gulf Coast. “Louisiana is well-positioned to support this growing industry with global reach, attracting tens of billions of dollars in investments and the quality jobs these projects represent,” he says.
No. 38 MISSISSIPPI
Rolling in New Opportunities
Mississippi is still riding a wave of momentum from Continental Tire’s commitment to construct a $1.45 billion tire plant in Central Mississippi. In August, the company opened its on-site employee training center.
The state has since won several monumental economic development projects in various sectors in the past year, says Glenn McCullough, Jr., executive director of the Mississippi Development Authority. Amazon and Corelle Brands have both located distribution operations in Marshall County, bringing a combined 1,200 jobs to the region. Williams-Sonoma announced in December it will bring production of its furniture to the state through its wholly owned subsidiary, Sutter Street Manufacturing. On the Gulf Coast, where shipbuilding is a prominent industry, VT Halter Marine will create 900 jobs with an expansion of its operations in Pascagoula.
“So far this year, the state has announced approximately 3,200 new careers and $614 million in new capital investment in Mississippi’s communities,” says McCullough.
New Opportunities in IT and Cyber
Exports from the Mountain State increased for the second year in a row in 2018 to reach more than $8.1 billion, according to a report from the West Virginia Department of Commerce. The state’s exports grew by more than 14 percent, almost twice the national average of 7.6 percent. While coal has been making a slow comeback and remains the state’s main export product, plastics, chemicals, metals, and automotive and aerospace materials amounted to more than $3 billion in exports.
And in June 2019, the U.S. Department of Commerce Bureau of Economic Analysis reported that the state led the nation in personal income growth for Q1 2019 with a growth rate of 5.6 percent. Gov. Jim Justice said in a press release that the state economy is growing faster every day and that “our days of being dead 50th are long gone.”
One area the state is looking to is IT and cybersecurity. In February, tech company Infor announced bringing 100 technical jobs to Charleston to run cloud applications for U.S. government agencies. The West Virginia Forward initiative also partnered with TechConnect WV last year to bring attention to cybersecurity educational initiatives and job opportunities to create a larger trained cyber workforce. In January, TechConnect WV unveiled its cybersecurity workforce strategic initiative to focus on training and employing state residents in the cybersecurity field.
“This plan seeks to outline and coordinate stakeholders involved in providing cybersecurity education, training and employment and offers a comprehensive strategy for growing this industry here in West Virginia,” says Anne Barth, executive director of TechConnect.