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Alabama looks to add to manufacturing gains along with tech, biotech growth in 2019

Alabama added more than 44,000 jobs across all industries in 2018 and ended the year by posting in December the highest average weekly earnings ever recorded in the state’s history.

Alabama Commerce Secretary Greg Canfield shared the state’s 2018 economic development successes with fellow economic developers in Hoover Monday while sharing the Alabama Commerce Department’s plans for the new year ahead. The Economic Development Association of Alabama is holding its winter conference this week.

“It reinforces to me what is the ultimate strength of Alabama as a competitor in the economic development arena and that is we work as a team,” Canfield said, citing state and local economic development entities and government leaders, the private sector and universities.

Among the 2018 successes Canfield noted:

• The $1.6 billion Mazda Toyota plant under construction in Huntsville is a gamechanger for the state with 4,000 jobs and 300,000 vehicles per year when it reaches full production.
• The state saw $3 billion in new foreign direct investment that accounted for at least 6,000 new or announced jobs last year.
• Shipt’s decision to expand in Birmingham and add 881 new jobs provided a blueprint for how the state can target the tech sector in the innovation  economy.

The Mazda Toyota deal adds to the state’s automotive sector that already includes Mercedes-BenzHondaHyundaiAutocar and dozens of suppliers.
Canfield said the state is on pace to become the second largest auto-producing state in the nation as soon as 2022.

“It’s interesting to note that in every journal, every article that you read today talking about the automotive sector across the United States, you’re going to read that Alabama is the No. 5 state in terms of vehicle production,” Canfield said. “And that’s a great story, isn’t it? Because prior to 1997, we didn’t produce a single vehicle. In 2017 and 2016 – and we don’t have the numbers in for 2018 – but in the two previous years, Alabama hands and Alabama automakers produced over a million vehicles.”

Pointing to a chart using Bloomberg data, Canfield said the state is steadily climbing the rankings compared to Indiana, Kentucky and Ohio and will trail only Michigan in a few years.

“We actually believe that based on the numbers that Alabama is most likely the fourth largest vehicle-producing state, Canfield said. “We expect that by 2022, if the numbers hold and the forecast is true, Alabama will take the position as the No. 2 vehicle-producing state in the U.S. and that’s an amazing feat.”

Job growth in the state is outpacing the experts’ projections, Canfield said.

“We gained 44,300 jobs across all industry sectors in 2018,” he said. “Most economists believed we would be doing good and performing well if we added 30,000 jobs.”

So how does the state economy continue to soar? One way is with Airbus building more airplanes.

The company broke ground on a new assembly line in Mobile on Jan. 16 that will bring 432 new jobs as it produces the A220 line of aircraft, joining the A320 family of aircraft produced at its existing plant.

“Having these two lines combined will ultimately make the state of Alabama the No. 5 production location in the globe for commercial large aircraft production,” Canfield said.

With the Airbus project, the state is getting a 278 percent return on its “investment” over the next 20 years based on the incentives the jet maker received.

Focusing ahead, Canfield said “2019 is going to be an important year. We’re going to have to do some things differently as we look to the future. We’re not going to be bashful about that, either.”

Canfield noted the 2020 Census will be important to the state and its economic development efforts. A failure to count the state’s population accurately could cost the state federal dollars and representation, he said.

“If we are undercounted, we will not get correct allocation,” Canfield said.

Canfield said the state wants to build on the tech-sector recruitment successes of Amazon, Facebook and Google and put a greater emphasis on helping homegrown companies like Shipt stay in Alabama and grow. The strategy and program developed for Shipt is the blueprint to do that, he said.

Broad partnerships, university support to drive STEM jobs, AIDT’s expansion beyond manufacturing training and working with local governments and private sector partners like Alabama Power on recruiting talent were some of the elements that made the Shipt project happen, Canfield said.

Other areas that Canfield will emphasize in 2019 include:

• The biotech and life science sector,
• Workforce development,
• Supplier network for Toyota Mazda,
• Rural Alabama,
• Aerospace and
• Forest products.

By the end of the year, Canfield said the Department of Commerce will take a fresh look at its long-term strategy. The first two versions of Accelerate Alabama helped the state add $28.8 billion in new capital investment and 105,000 new or announced jobs between 2012 and 2017.

“I think it’s time to thing about Accelerate Alabama 3.0,” Canfield said.

(Courtesy of Alabama NewsCenter)

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