EconSouth (Third Quarter 2002)

THE STATE OF THE STATES
Recent events and trends from the six states of the Sixth Federal Reserve District
Alabama Alabama
Honda Motor Co. will add a $425 million assembly line to its Lincoln auto plant, creating 2,000 jobs by 2004. Honda’s expansion means that the plant will double its output of the Odyssey minivan and V-6 engine to 300,000 a year.
Bender Shipbuilding and Repair Co. Inc. of Mobile has been awarded an $8 million contract to refurbish the frigate USS Stephen W. Groves. About 125 employees will be assigned to work on the ship.
Higher prices for steel have boosted production in the region. Demand for domestic steel has surged following a series of tariffs on imported steel. One Alabama company recently ramped up production to an all-time high and is expected to reach full production capacity by year-end.

 
  Florida
Guests headed to Disney World are reportedly waiting until the last minute to book their travel, and international visitors are still lagging behind last year. Nevertheless, hotel occupancies in the area are at about 90 percent of normal capacity in part because of discounting.
The chairman of the Travel Industry Association reported that Florida tourism, while recovering to near-2000 levels, won’t surpass record tourism levels until 2004. Tourism officials say that the decline in fly-in visitors has been offset in part by a considerable increase in the number arriving by car.
Agere Systems Inc. granted a reprieve to more than 1,000 workers at its Orlando microchip manufacturing plant, announcing that it would keep the plant open for at least two more years. The plant manufactures chips used in telecommunications equipment.
Florida
Georgia Georgia
Market observers in Atlanta have seen an improvement in industrial leasing recently. Preliminary numbers indicate that the market had absorbed nearly 2 million square feet of space at midyear compared to 2.57 million square feet of space leased during all of last year.
Georgia ports posted another year of double-digit increases in tonnage. During the fiscal year ending June 2002, the state’s ports moved 11 percent more cargo than in the previous year. This increase followed last year’s record 20 percent growth. As port workers on the West Coast negotiate a labor contract and strike possibilities loom, some shipments from Asia are being diverted to Georgia.
Toyota Motor Co. will build a $60 million parts plant in Jackson County that will create 120 new jobs over the next few years. The plant will make compressors for auto air conditioners.
 
  Louisiana
The gaming business on boats and in video-poker establishments in Louisiana has improved during the current fiscal year. The state is expected to realize about $30 million more in revenues than projected.
The Louisiana oil industry’s average rig count rose to 161 in July from 156 in June; the U.S. rig count climbed to 856 from 842. The average price for Louisiana sweet crude oil rose slightly to $27.11 per barrel in July compared to $25.57 per barrel in June.
Louisiana
Mississippi Mississippi
The state’s casino coffers continued to grow. Through June, gross gambling revenues statewide were up 2 percent over last year. The 12 casinos on the Gulf Coast saw their revenues rise 1 percent last month.
Nissan Motor Corp. has announced that it will further expand its Canton, plant. The $500 million expansion, which means 1,300 new jobs, will accommodate an annual production of 150,000 Altimas.
A commercial rocket motor manufacturer plans to invest about $250 million in construction of a new plant near Iuka. The facility is expected to eventually employ 600 workers.
Mississippi’s governor called for a special legislative session to approve a $31.5 million incentive package for the expansion of Laurel-based Howard Industries. The expansion will create 2,000 jobs at a new Howard Industries manufacturing division.
 
  Tennessee
A new manufacturer, Astec Industries Inc., plans to stimulate the economy of Loudon with the opening of an equipment plant that will employ 250 people. The plant will be located in the old John Deere manufacturing facility.
Tennessee’s unemployment rate was a relatively low 4.8 percent in June compared to a 5.8 percent rate for the nation. Total nonfarm employment fell 0.6 percent in the second quarter following a 0.5 percent rebound in the first quarter.
While working under a temporary budget that furloughed more than half the state’s workforce in early July, legislators approved a $933 million tax increase, the largest in the state’s history. The greatest portion of the tax hike will come from a 1 percent sales tax increase.
Tennessee
Compiled by the regional section of the Atlanta Fed’s research department

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