The United States is enjoying a resurgence in manufacturing. Central Louisiana is particularly well-positioned to move from “good” to “great” as a location for smart, efficient, profitable and growing manufacturers.
The demise of manufacturing in the United States has been so thoroughly chronicled that it’s easy to miss the fact that the U.S. is still the world’s largest manufacturer. Shifting world economic patterns and the fact that the U.S. is twice as efficient as the next ten largest manufacturing nations have resulted in the phenomenon known as “reshoring”—the return of manufacturing operations that once went abroad in search of lower costs.
Some of the decline in U.S. manufacturing tracks the demise of farming before it—manufacturing became far more efficient, requiring fewer workers to achieve greater levels of output. In a speech to the Central Louisiana Economic Development Alliance (CLEDA) in September, Mississippi Manufacturers Association President Jay Moon noted that U.S. manufacturing output has risen dramatically and consistently since 1947, while manufacturing employment has done just the opposite. With reshoring, manufacturing employment is once again growing, both nationally and locally.
In addition to Central Louisiana’s historic strength in agriculture, agri-business, forestry- and timber- related industries, and the service sector, the region has long had a good base of manufacturers.
Procter & Gamble could be viewed as an anchor tenant for manufacturing in the region—one that has been with us since 1969 and is still growing. The company has a million-square-foot plant on 112 acres in the Coughlin Industrial Park in Pineville. P&G recently announced an expansion that will add another fifty jobs as a result of corporate consolidation of the detergent-powder manufacturing. This follows the completion of a $100 million expansion last March and the launch of Tide Detergent Pod manufacturing. Procter & Gamble’s presence in Central Louisiana also served as the primary catalyst for the location of such important job-producers as Calvary Industries, Plastipak and Integrated Packaging Corporation.
Universal Plant Services Midstream just announced a new plant in Jena to manufacture and repair reciprocating compressor equipment, commonly used in many different industries, including refineries, power plants and companies in the petrochemical industry. UPS will create 95 new jobs paying an average salary of more than $73,000, plus benefits. The project will also create 121 new indirect jobs, for a total of more than 200 new jobs in the Central Louisiana Region.
A new advanced biofuels plant will be built by Sundrop Fuels, Inc. near Rapides Station and England Air Park in Rapides Parish. Sundrop Fuels is a Colorado company, with significant backing from Chesapeake Energy Corporation and leading venture capitalists. The new plant will cost over $450 million to build and will be financed in part through the sale of tax-exempt Private Activity Bonds facilitated by the England Authority. The Sundrop plant will employ about 150 people with an average annual salary of $58,000. More than 1000 indirect jobs will be created through Sundrop’s presence in Central Louisiana.
In Winn Parish, the announcement that JELD-WEN would launch operations after a multi-year delay was greeted with the enthusiasm of a new announcement. The company is busy completing construction and hiring some 75 new workers (which will drive an additional 117 indirect jobs). This plant will manufacture wood-fiber door facings. In addition to offering LED FastStart services, the state secured the project by providing a performance-based $750,000 Economic Development Award Program grant for site infrastructure, and JELD-WEN is expected to utilize Louisiana’s Quality Jobs and Industrial Tax Exemption Program incentives.
In Natchitoches, International Paper’s The Red River Containerboard mill is one of the 16 that is located in the U.S. The products produced at the Red River Containerboard mill have global reach, but the economic impact to the surrounding community and the state of Louisiana is direct and it is significant. In addition to its over 400 dedicated employees, the mill also fully supports over 125 jobs in the local fiber procurement, trucking and rail businesses to handle the transport of raw materials into the facility and to ship paper globally. Factoring in wages, state and local taxes along with supplier impact, the Red River Containerboard mill has at least a $157 million dollar direct impact on the local economy.
Likewise, Weyerhaeuser has announced a $6 million capital investment that will retain 175 jobs and create 30 new jobs at the company’s Natchitoches forest products plant. The company will modernize and upgrade equipment that will lead to more productive operations at the Weyerhaeuser Engineered Lumber Products site, with the new direct jobs paying an average salary of more than $31,000, plus benefits. LED estimates the project will result in an additional 77 new indirect jobs in the area. At the 250,000-square-foot facility in Natchitoches, Weyerhaeuser produces I-joists under the Trus Joist brand and laminated veneer lumber and structural header and beams under the Microllam brand.
Other regional manufacturers experiencing significant growth in the last few years include Union Tank Car, Dis-Tran (Crest Industries), and Roy O. Martin’s manufacturing operations. Smaller manufacturers benefitting from the surge in manufacturing include Hayes Manufacturing, Manchac Technologies, Eclectic Products and AFCO. Other significant manufacturers with a presence in Central Louisiana include GE, Accurate Industries, Hunt Forest Products, Boise Wood Products, BASF, Kerotest Manufacturing, Stella-Jones, Great Southern Wood, Arclin, Willamette Valley, Momentive, Baker Manufacturing, Oilfield Instrumentation, Catahoula Manufacturing, Louisiana Elastomer, Sports Design, Consolidated Energy, CLECO, Leesville Lumber, West Fraser and Alliance Compressors.
For CLEDA and other economic development agencies and supporting organizations in Central Louisiana, attracting new and growing the existing base of manufacturers is a top priority. Now that commitment is beginning to pay off, and it appears that the best is yet to come. CLEDA intends for the region to capture even more than its fair share of these new, high quality jobs. Manufacturing jobs are considered to be economic drivers, jobs that export goods and services from the region while importing dollars from outside the region. This “imported cash” from outside the region will create demand more and more services in the region and grow service-oriented jobs as well.
So, what does it take for Central Louisiana to win big in the rejuvenated manufacturing sector? The somewhat oversimplified answer is “people and places.” We must have educated, skilled, reliable and motivated workers. And we must have industrial sites that are attractive to the industrial and site-selection communities.
No region is capable of sustained economic growth beyond the capacity of its people to perform. The education and skills of our workforce represent our biggest potential and our biggest constraint. We must improve our levels of educational achievement in every sector of our workforce.
Louisiana’s public K-12 schools are undergoing massive changes as a result of changes in state law. Prior to the enactment of those changes, however, the Orchard Foundation and the Rapides Foundation had created the Cenla Work Ready Network. With a goal of “preparing tomorrow’s workforce,” the Network is intended as a system designed to link education with workforce development efforts and align them with regional economic needs. Although less than two years old, the Network has already resulted in close to 3000 high school students becoming certified und the national ACT WorkKeys process. CLEDA is working closely with the Foundations to encourage and support businesses as they utilize WorkKeys in the employment process.
Another crucially important education and training factor for Central Louisiana is the upgrade of its community and technical college resources. In 2012, the Louisiana Legislature authorized the conversion of Central Louisiana’s technical college to a full “Technical Community College”. This designation brings greater responsibility and greater resources. Legislation in the upcoming session will be proposed to fund the construction of a major new campus in the Alexandria-Pineville area. A fully-operational community college is perhaps the single most important factor in Central Louisiana’s mid-to-long term prosperity.
Finally, the business community must work closely with other higher education resources in the region to make sure that the course offerings meet the potential needs of the region. The biggest players in this space in the region are LSUA, Northwestern State University and Louisiana College. CLEDA, the Central Louisiana Chamber of Commerce and others will be closely focused on how these institutions (particularly the public schools) meet these needs.
CLEDA also devotes significant time and energy to the creation and development of good industrial sites throughout the region. In Rapides Parish, this means working closely with partners like England Air Park, the Port of Alexandria, the various municipalities and private sector partners. National and international site selectors become more demanding each year. Sites that are designated as “certified” by accepted experts and agencies are now at the top of the list for most site selectors. CLEDA is committed to expanding the number of certified sites in the region in order to become more attractive to the industrial community.
Activity in Avoyelles is also starting to pick-up and they are positioning themselves with the development of the Avoyelles Parish Port at Simmesport and Bunkie’s new Industrial Park. The 148-acre Industrial Park was added to the SmartSites program by CLECO and McCallum Sweeny Consulting, one of the leading site selection agencies in the nation. The site is located near I-49 and Acadiana Rail, both of which will be key to attracting to a potential manufacturer.
The Port and Industrial Park in Natchitoches also went through the rigorous evaluation process, which includes a thorough appraisal of all aspects of readiness for development by a manufacturer. Their 350-acre park was certified as a SmartSite by CLECO and McCallum Sweeny in 2010. England Air Park also recently received SmartSite designation for a site adjacent to Union Tank Car’s manufacturing facility. Having three SmartSites in the region is a great competitive edge, creating an attractive and compelling landscape for significant recruiting opportunities for the next several years.
The Central Louisiana Economic Development Alliance has supported many of these expansions, through their direct efforts and many indirect initiatives. They have worked directly with each company and municipality to develop a comprehensive plan for overcoming barriers and final implementation. To ultimately succeed, the team will consist of many state, parish and city governments, and other economic development organizations, as well as our K-12 school districts, Central Louisiana Technical Community College campuses, LSUA, Northwestern State University and the Louisiana Workforce Commission.
CLEDA conducts active programs for manufacturing support, workforce development, entrepreneurial development and innovation. CLEDA recently helped to form the Central Louisiana Manufacturing Managers Council, which will strengthen the capacity of the manufacturing sector to become even more competitive, now and in the future. Another important CLEDA initiative that supports manufacturing in the region is the Business Acceleration System, which now provides monthly coaching and consulting services for some 50 emerging businesses throughout the 10 parishes.
CLEDA is a nonprofit organization and is designated as the “regional development organization” for Central Louisiana by Louisiana Economic Development. For more information, see www.centrallouisiana.org.