EconSouth - Second Quarter 2008
EconSouth - Second Quarter 2008
Manufacturing Revs Up Mobile
Change is afoot in Alabama's oldest city.
The port town of Mobile, Ala., 300 years old in 2002, anticipates welcoming two of the biggest industrial employers the city has seen since a World War II–era shipbuilding frenzy. Given Mobile's international heritage—the flags of France, Britain, Spain, the Confederate States of America, and the United States have all flown there—it is perhaps appropriate that the new factories largely will be courtesy of European companies. Moreover, Mobile's economic progress of late has been helped mightily by an Australian shipbuilder and an aerospace firm based in Singapore.
The economy goes boom
Moody's Economy.com estimates that between 2007 and 2012, Mobile County's economy will have the greatest expansion among all 363 U.S. metropolitan areas. Economy.com and Forbes.com forecast the Mobile economy will grow 34 percent during that five-year period.
Forbes attributes the coming boom to the $3.7 billion ThyssenKrupp steel mill scheduled to open just north of Mobile in 2010, Austal USA's ongoing success in shipbuilding, and the Northrop Grumman/EADS airplane assembly plants slated to be built in Mobile. The city's port and access to interstate highways 10 and 65 are also major assets to its growth.
Based solely on projects already planned or under way, the Mobile area could easily add more than 15,000 jobs in the next three to five years, said Semoon Chang, professor of economics and director of the Center for Business and Economic Research at the University of South Alabama in Mobile. By comparison, from 2000 to 2007, Mobile added just 3,200 jobs, according to the U.S. Bureau of Labor Statistics, with the majority being added only recently.
Manufacturing and more
Austal is currently Mobile's second-largest manufacturing employer, with 1,100 workers and a plan to roughly double its shipbuilding capacity, mainly to supply U.S. Navy combat ships. The company launched the first such vessel, a futuristic 417-foot aluminum craft, in late April and is expected to add about 4,000 workers in the next few years, according to Chang.
Along with shipbuilding, the aerospace industry has surged in recent years. Mobile's present top manufacturing employer, with 1,302 workers, is ST Mobile Aerospace Engineering, a unit of a Singapore-based company that opened an aircraft servicing operation at the Brookley Industrial Complex in 1990.
Mobile's Alabama State Docks complex has also contributed to recent growth. It now ranks as the 10th busiest seaport in the country based on tonnage, according to the U.S. Army Corps of Engineers.
Even more development is on the way, including a new container terminal at the Port of Mobile scheduled to open in September and the planned Alabama Motorsports Park and Dale Earnhardt Jr. Speedway.
The biggest bang
The Northrop Grumman/EADS plants are a close second in terms of expected economic impact. The Air Force refueling tanker and civilian cargo plane assembly plants are expected to employ about 1,800. (European aircraft maker EADS opened an office last year at the Brookley Industrial Complex and already employs 75 aerospace engineers.)
Pending the outcome of a Boeing protest of the awarding of the Air Force tanker contract to Northrup Grumman/EADS, Airbus tentatively plans to break ground on the $600 million center at Brookley Field on June 28 and start producing the commercial freighters within two years, according to the Mobile Register. The aircraft assembly plant would almost certainly attract numerous suppliers, Chang noted.
A couple miles north of Brookley, the $300 million Mobile Container Terminal at Choctaw Point is expected to create 300 jobs. The terminal will eventually add two million annual tons of containerized cargo to the 700,000 tons the Port of Mobile currently handles each year, according to the Alabama Port Authority, which operates the docks. All the property abutting the terminal has been snapped up for warehouse and other development, Chang said.
Although plans are in place, construction has not yet begun on the proposed Earnhardt Speedway complex in Prichard, an area adjacent to Mobile. Chang said the complex would create about 2,000 full-time jobs, most of them in the lower-paying service sector.
In addition, finding enough highly skilled workers to fill the new positions could be a challenge. "Workforce development becomes a huge issue for this community," Sisson said. The state, city, county, and local community colleges and schools have established an umbrella job training initiative to help satisfy the demand. The initiative is setting up training centers specifically for ship building and aerospace workers and for ThyssenKrupp.
If the predicted boom does come, it won't be Mobile's first. By 1840, as cotton growing spread farther inland, the city became the nation's second-biggest cotton exporter, behind New Orleans. And by 1860, Mobile was the second-largest city in the Southeast, again trailing only New Orleans.
Another boom occurred 80 years later, when workers flocked to Mobile to build Allied warships. Between 1940 and 1944, Mobile County's population soared by 91,000 people, to 233,000. But when World War II ended, so did about 40,000 defense jobs.
Today, another bonanza looms for the city. This time, though, the diversity of development means it is unlikely to end as suddenly as previous ones.
This article was written by Charles Davidson, a staff writer for EconSouth.