EconSouth (First Quarter 2006)

The State of the States

Recent events and trends from the six states of the Sixth Federal Reserve District

North American Lighting Inc. recently announced plans to build an automotive tail-lamp factory in Muscle Shoals that will create at least 320 jobs. The company will invest about $22 million in the factory, which will begin operation in June 2007.
Russell Corp., an apparel manufacturer, will eliminate 1,000 jobs in Alabama over the next two years and will outsource some of the jobs to facilities in Honduras and Mexico, according to the company. After the cuts, Russell will have 2,000 workers in Alexander City, down from 3,400 earlier this year.
Bender Shipbuilding & Repair Co. said it will add 150 jobs over the next three years as part of a $10 million expansion of its Mobile shipyard. Bender currently employs about 700 people at its Mobile River complex.
 
Central Florida’s large theme parks—Disney World, Universal Orlando, and SeaWorld Orlando—reported strong business over the winter holidays, with Disney World tallying record attendance for the season.
International tourism boosted room prices and occupancy rates at south Florida hotels during the holiday season. Hotels in Miami-Dade County came close to their record occupancy rate of 71 percent, set in 1997, according to a spokesman for Lodging Econometrics, a firm that studies hotel activity.
Office vacancy rates improved in Jacksonville. An office market report from CB Richard Ellis, a real estate service firm, notes that the rate for the Jacksonville area at the end of 2005 was 15 percent, the lowest annual rate since 1999’s 12.3 percent. Investor interest in commercial properties also remained strong in Orlando, according to Grubb & Ellis/Commercial Florida.
 
YKK AP America announced that it is doubling its capacity in Dublin. The company will invest $80 million in the expansion and will hire approximately 200 workers over the next four years.
Ford Motor Co. announced that it will end production at its Hapeville plant by September 2006. The plant, which opened in 1947 and employs 2,100, produces the Ford Taurus.
Business at the Georgia World Congress Center (GWCC) has seem growth in convention attendance, including 10 conventions originally booked in New Orleans. GWCC officials estimate that over the next two years 122,000 people will attend conventions in Atlanta that were originally slated for Louisiana.
Kia Motors Corp. announced that it will build a $1.2 billion assembly plant in West Point that will employ 2,500. The plant is expected to reach full production by 2009. New suppliers for the plant are expected to create about 2,000 jobs. State and local incentives of about $400 million helped to lure the plant to Georgia.
 
The National Association of Realtors plans to hold its annual meeting in New Orleans in November 2006. The gathering is expected to bring more than 23,000 attendees to the city and will be the largest convention to recommit to New Orleans for 2006 since Hurricane Katrina.
The recovery of the Port of New Orleans is still hampered by a limited pool of available truck drivers. Many drivers have taken lucrative jobs offered by federal contractors for cleanup operations in the region. Prior to Katrina, the port required about 1,000 truckers daily.
Louisiana Superdome officials are setting an aggressive construction schedule to have the building ready for football. NFL and New Orleans Saints officials have urged the state to expedite construction so the team can play its regular-season games there this season, which begins Sept. 7.
 
Shipyards on the Mississippi Gulf Coast say business remains brisk, but attracting skilled workers remains a problem. VT Halter Marine Inc. and Signal International, both in Pascagoula, have large backlogs of construction projects. Both shipyards report almost full recovery from Hurricane Katrina.
The DuPont First Chemical plant in Pascagoula recently restarted operations after completing $40 million in repairs to buildings and equipment damaged by Hurricane Katrina. The plant employs 180 people and produces oil-based solvents used in dyeing.
Three of the state’s coastal casinos reopened in December: the Palace Casino, the Imperial Palace, and the Isle of Capri. Together, they put about 3,000 of the Gulf Coast’s 17,000 gaming employees back to work. Some Biloxi casinos are scheduled to reopen throughout 2006.
 
DENSO Manufacturing Tennessee Inc., a parts supplier, announced a $185 million expansion of its Maryville plant, boosting the plant’s employment by 500 by the end of 2007.
General Motors Corp. has chosen its production plant in Spring Hill to make the gas-electric hybrid version of the Saturn Vue SUV.
Nashville-area home sales in 2005 were up 6.5 percent over 2004 sales. December 2005 sales broke the 3,000 mark for the first time, according to the Greater Nashville Association of Realtors.
Colgate-Palmolive Co. plans to build a new toothpaste manufacturing plant in Morristown. The facility will employ more than 220 people. Construction will start in May 2006, and hiring should begin in early 2007, according to the Tennessee Department of Economic & Community Development.
This information was compiled by Dave Avery, a senior economic analyst at the Atlanta Fed.
Illustrations by Jay Rogers

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