North Carolina: New Governor Puts Job Creation First

On January 10, North Carolinians welcomed a new governor, who for the previous eight years had been the state's lieutenant governor, a role that provided insight into the state's economic development matters. Gov. Bev Perdue says creating jobs and growing the state's economy are among her top priorities as the new governor.

“During the economic downturn, we will undertake major state infrastructure projects to enhance our transportation network and increase the capacity of our research institutions and universities,” writes Gov. Perdue, in an e-mail correspondence. “These investments will further enhance our state's already top-rated business climate.”

Perdue and North Carolina's economic development leaders will focus on expanding the state's military and defense economy, its alternative energy and green economy sectors, as well as its growing aerospace cluster.

In Wake County, officials are in discussions with the state's General Assembly to visit about initiatives to support its serious games industry, which is similar to the entertainment game industry, says Ken Atkins, executive director, Wake County Economic Development. The industry's technologies are geared toward businesses uses, such as flight simulators for pilots; weapons and systems training for the military; and medical device training, such as robotic surgery and implantable devices.

The Raleigh region is home to 38 serious game and entertainment game companies; as well as degree programs geared toward the industry. North Carolina State University is home to the Digital Games Research Center.

Industries And Innovations

The state's industry clusters are focused on high-tech, knowledge-based and sustainable jobs in industries such as aviation and aerospace, biotech and pharma, financial services, military and defense and information technology and communications.

The military is important to Fayetteville and Cumberland County, which is home to Fort Bragg. The community has been busily preparing on several fronts, such as education, transportation and housing, to support the increases at the base, which will open the Forces Command on Sept. 15, 2011. The BRAC Regional Task Force is working with officials in an 11-county region to prepare for the military's transformation.

For example, a virtual reality center offers courses that afford industries the opportunity to participate in 3D training. “The training is going out to eight community colleges and 11 of our hospitals,” says Phyllis Owens, senior vice president for economic development, Fayetteville-Cumberland County Chamber of Commerce.

Owens says the community is underway with initiatives to support defense industry suppliers. The All American Business Center, a 215-acre business park, is under development which abuts Fort Bragg. The plans for this park include an incubator, a conference center and hotel, and some retail; however the park is dedicated mainly to office and flex space for industries associated with the base.

Defense-related activities are also supported by the Defense Security Technology Accelerator, an incubator that has begun graduating companies. “We are growing these defense companies ourselves,” Owens says. “In conjunction, there are a number of other initiatives that help those that want to learn to work with the government. An example is the Military Business Center, which teaches companies how to become defense contractors.”

Wake County and the Raleigh region feature a strong pharma and biotech cluster. Novartis is under construction with a flu vaccine facility in Holly Springs, where it will manufacture the vaccine in reactors instead of chicken eggs. Additionally, Merck has a large expansion underway in Durham.

Financial services companies also find Wake County an ideal location. Credit Suisse has a major operations and service center in the area, with a variety of job functions. “One of the strengths we bring is in software development because we have a lot of these companies in the area,” Atkins notes. “Our financial services companies are able to tap into that expertise to develop new financial tools they use in their services. Our greatest asset is the ability for companies to come here and take advantage of the innovative climate that exists in the triangle.”

Back at the state level, one of the leading announcements in 2008 came in April when GE Hitachi Nuclear Energy Americas LLC announced it would expand its campus in Wilmington. The expansion is expected to create more than 900 jobs during five years. The company, which had more than 2,000 workers at the campus before the announcement, will invest more than $700 million in the expansion.

The company is able to tap into a skilled workforce, and its partnership with Cape Fear Community College, which trains technicians in nuclear utility maintenance and repair. Also in 2008, Spirit AeroSystems announced it would open a manufacturing plant at the N.C. Global TransPark in Kinston. The company, which is the world's largest independent supplier of commercial airplane assemblies and components, will invest $570 million in the project, and create more than 1,000 jobs during a six-year period.

Talent And Education

North Carolina offers businesses customized worker recruiting, screening and training services through agencies such as the North Carolina Department of Commerce and the North Carolina Community College System, which consists of 58 campuses.

Companies are assured they will have access to well trained workers, as well as a pipeline of education and talent. The state's officials continue to invest in education, from K-12 through community colleges and public universities, in both lean and good times.

The state's quality of life amenities, such as cultural and outdoor opportunities, continue to attract knowledge workers to the state; North Carolina is now the 10th largest populated state in the country.

“Nearly 20,000 students graduate from the region's higher education system each year,” Atkins says of Wake County. “We also have a large influx of people moving into this area, many of whom hold college degrees. They come here for the opportunities in innovation but also because of the quality of life. As we continue to grow with, in many cases, what is a very productive and innovative workforce, we have companies moving here to take advantage of that.”

Assets

The anticipated initiatives Gov. Perdue will announce in the future will further enhance a business climate that was hit hard by job losses earlier this decade, and which has bounced back through the work of former Gov. Mike Easley and the General Assembly.

When the state lost 200,000 jobs between 2001 and 2003 due to operations for industries such as textiles and furniture manufacturing being transitioned overseas, the Job Development Investment Grant program was one of its responses to turn things around. The performance-based, discretionary incentive program provides annual grants for up to 12 years to businesses measured against a percentage of withholding taxes paid by new employees.

Along with this program, other programming, and industry diversification, the state has recouped the job losses and added additional jobs.

North Carolina's officials are also leveraging their intellectual capital, talent and institutions, such as the Research Triangle Park area and the N.C. Research Campus in Kannapolis, to encourage entrepreneurship and innovation.

For example, the N.C. Green Business Fund created in 2007, and championed by then Lt. Gov. Perdue, offers grants to assist small businesses, nonprofit organizations, and governmental agencies developing green and alternative energy technologies to bring cutting-edge, environmentally friendly products and services to the marketplace.

Another program, the One North Carolina Small Business Fund assists small businesses by providing matching funds to federal SBIR or STTR grants, which are designed to encourage innovative research and technology development.

Other business advantages found in North Carolina include low costs for electricity, where rates are typically 20 percent below the national average. “As you know, in this economy, energy costs are among the top five siting factors,” says Clark Gillespy, director of economic development, Duke Energy Carolinas. The utility provides electric services to 40 counties in North Carolina and 14 counties in South Carolina.

Gillespy says the utility is on its way to meeting North Carolina's Renewable Portfolio Standard, which says its generation has to consist of 12.5 percent renewable energy sources by 2021. “We have announced a $50 million solar on rooftops program where we are looking at installing solar panels on residential, commercial and industrial customers' rooftops.”

The utility has also purchased wind farms and/or wind energy from organizations in Wyoming, Texas and Indiana. It is also working on a biomass project. Duke Energy Carolinas is also focused on attracting alternative energy companies to its 24,000-square-mile service territory. It hopes to build upon the announcement by SunEdison that it will establish a 16-megawatt solar panel farm in North Carolina. “We are working with a handful of solar panel manufacturers, trying to create a cluster of this type of manufacturing in the Carolinas,” Gillespy says.

Lifestyle

A visit to the North Carolina Department of Commerce's Web site, www.nccommerce.com, outlines the cultural and recreational amenities found in the state. North Carolina is home to the nation's first state-supported symphony and art museum. Additionally, North Carolina offers a living history of stock car racing, which has its roots in North Carolina.

In regard to the costs of living, housing, utilities, supplies and groceries, transportation and health care, all are below the national average.

Lifestyle amenities, an innovative business climate and pro-business governor bode well for North Carolina's economic future. “I am confident we can meet our constitutional obligation to produce a balanced budget while maintaining both our job creation tools and our historic commitment to education and workforce training,” Perdue notes.

Written and compiled by Rachel Duran.

For complete details about conducting business in North Carolina, visit: