ABB 2006/7 | State Profiles | South East region | Alabama | Profile

Alabama has become a force to be reckoned with when it comes to competing in the highlycompetitive race for economic development projects and has much to offer UK companies seeking to invest in the US.

In fact, 29 UK companies already call Alabama their home, ranging from aerospace firms such as GKN Aerospace and BAE Systems to speciality steel producer Nucor, which recently began construction on a $167m expansion in the state. The state has been consistently ranked first in several key economic development areas and its industrial workforce training programme in August was ranked first among programmes in all 50 states, according to a national survey of industrial site selection consultants. Alabama has earned recognition as “State of the Year” for four years in a row by Southern Business and Development magazine. The state also claimed Site Selection magazine’s 2004 Competitiveness Award for the recruitment efforts of the Alabama Development Office. In 2005, Alabama won Area Development ’s “Golden Shovel” award for job creation success.

“We received these awards based on our successful efforts in formulating an aggressive marketing programme with our agency and our partners throughout the state,” says Alabama Development Office (ADO) Director Neal Wade. Wade explains: “We work hard to build relationships with site consultants and keep them up-to-date on information about our state because they are vital in supplying companies. We also work with economic development professionals across the state – some are specific to economic development organisations, some work with chambers and some are with companies.

They are our allies and our success is a result of the partnerships we have forged with our communities.” In 2005, the cooperative efforts between the ADO and other organisations throughout the state helped create 25,253 new jobs, one of the highest numbers recorded in the state. This number includes any jobs created through expansions or new companies locating and have not all been created through ADO. “The bar has been set kind of high for us to crack the 20,000 mark every year – our goal annually,” Wade says, “but we are up for the challenge.”

The foundation for the economic powerhouse now emerging in the state was Mercedes’ announcement in the early 1990s of its decision to build the popular M-Class SUV in Alabama. That key decision thrust Alabama into the world spotlight and other worldrenowned firms have followed Mercedes to Alabama, not only in the automotive industry, but in sectors such as aerospace, biotechnology, and wood products. The state has developed an automotive industry that has invested more than $7bn and created more than 40,000 new jobs. In 2005, Alabama, a state which had never produced a vehicle before 1997, became the third largest automobile producing state in the south. With the recent announcement of a Kia assembly plant on the Alabama/Georgia border, Alabama’s automotive industry will continue its phenomenal growth.

In the area of biotechnology, the state has broken ground on the 130-acre Hudson-Alpha Institute, where more than 900 scientists will do biotechnology and pharmaceutical research in Huntsville. The University of Alabama at Birmingham School of Medicine is ranked among the nation’s best, according to US News and World Report. The Birmingham area is also ranked eighth among the Top 20 southeastern metropolitan areas in technology employment.

Although the state has been highly successful in attracting major industries such as Boeing, Toyota, Honda, Mercedes and Hyundai, its efforts to attract other industries have played a major role in the state’s success. Wade explains that part of Gov Bob Riley’s mission was to expand the playing field so that more areas of the state could benefit from the state’s recruitment efforts. As a result, the state’s economic wealth is spreading out to new regions. In the month of September alone, Gov Riley announced four economic development projects that will bring 2,300 jobs to the state for the cities of Huntsville, Albertville, Fort Payne, and Guntersville. In South Alabama, Goodrich Aerospace chose Foley for an expansion that will create about 160 manufacturing jobs in the region in the next three years.

Alabama is home to some of the largest aerospace companies in the world such as Boeing, Lockheed, Raytheon, Northrop Grumman, EADS and GKN Aerospace, as well as hundreds of aerospace-related companies.

The state is also the home of several maintenance, refurbishment and overhaul companies, including Mobile Aerospace & Engineering and PEMCO. Groundbreaking ceremonies were held this year for a 150-employee EADS/Airbus aircraft engineering centre in Mobile, the culmination of more than a year’s work in bringing the facility to Alabama.

The state’s economic development team also has recognised the importance of working with the state’s existing industries to ensure that they remain profitable and that they have the best-trained workforce available. British-owned GKN Aerospace announced in 2005 that the company will add 250 new jobs to its Alabama facility in Tallassee. The company employs 535 people in Alabama and plans to invest $20m into the expansion project.

When asked why GKN chose to expand in Alabama, Vice President and General Manager Paul Cocker says that the workforce in Alabama “is about the best I’ve worked with in 35 years. The work ethic of the whole workforce is tremendous. They work hard and they work well.” Another Alabama company, HS Automotive Alabama (HSAA) Inc. expanded last year in the south Alabama city of Enterprise. The company will hire 500 people to its 250-member workforce. Company officials credited the expansion to the hard work of the company’s employees and the support received from state and local governments for the immediate and future success of the company.

“When we make a commitment to a company, we stand by it and work with the company to ensure the state is doing everything it can to help the company succeed,” Wade says. Expanding Alabama’s exports is also a priority for the state. In the first half of 2006, Alabama was one of the top four US states in terms of export growth. “Every dollar of increased exports from our state to the rest of the world means more jobs for Alabama,” Gov Riley says. “Our export growth is one of the reasons Alabama’s economy is expanding today. Nearly 3,000 businesses in Alabama sell their products overseas, and more than 75% of them are small and medium-sized companies.”

In 2004, Gov Riley launched a state initiative called “Export Alabama” to open up new trade opportunities for the state. The state led several international trade missions and held seminars across the state to educate Alabama firms on export opportunities that could improve their ability to export goods and services. “When we create more opportunities for our companies to compete fairly in international markets, the end result is more jobs at home,” Gov Riley says.

For more information, contact:
The Alabama Development Office
401 Adams Avenue, Montgomery
Alabama 36130 USA.
Tel: 334 242 0400
Website: www.alabamausa.org

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