South Carolina's Economic Engine

[goodbye]

I want everyone to know that I did not post that link as an advertisement at all. I have never studied any of his dealings, but happened to find that link and thought it worthy of mentioning and posting in this discussion. Regardless of his actual ability or desire to put feet to the comments in the document, I find the words very true and inspiring during these days of less certainty.

[Spartan]

Because the state can't afford it. 600 jobs isn't many in a state of almost 5 million people. Likewise the state is in a horrible mess from a jobs perspective.

Bull. The tertiary benefits of having a successful company locate in the state are more than worth teh tax breaks. BMW's contribution to the Upstate and SC are more than a few thousand jobs. The jobs that are created becasuse of the introduction of new employees in the region (high paid ones at at that) more than make up for that lost tax revenue.

600 jobs may not sound like much, but so what? How else is little ol' SC supposed to stay comptetitive? SC has one of the lowest per capita incomes in the US... so should we really start criticizing the methods of attracting these high paying companies? Right now we need to get them here. Later on, we will have the clout to get them to come without the insane tax breaks.

[krazeeboi]

Great points, Spartan. Also, the presence of such companies can have future spin-off effects that we can't really see today. Who knew that when BMW chose SC that it would also be a major player in the International Center for Automotive Research project, thus having more of an economic impact on the state than initially projected?

[GvilleSC]

Great points, Spartan. Also, the presence of such companies can have future spin-off effects that we can't really see today. Who knew that when BMW chose SC that it would also be a major player in the International Center for Automotive Research project, thus having more of an economic impact on the state than initially projected?

Very True! ^^ Good point Krazee, who knows how South Financial will impact SC down the road...?

[LuvSC]

In that same source its shows that Myrtle Beach had the fastest economic growth rate from 1993-2003 (infact it was 10th fastest in the country), followed by Columbia(112), Charleston(182), and then GSA(198) on table 5.

That same source shows GSA accounting for 26 percent of SC's gross state product, with Columbia contributing 17.8 and Charleston 13.7. (Table7)

Here's another factoid for ya, Sandlapper.

Federal data shows Greenville County with higher bank deposits per capita than Charleston, Lexington or Richland counties. In 2004, Greenville had $18,381 in bank deposits per person, Charleston $15,197, Lexington $8,387 and Richland $17,575.

I derived the figure from total bank deposits per county data from the FDIC Web site and population estimates per county from the Census site. I divided total bank deposits by population. I used 2004 because it was the latest population estimates I could find.

Interestingly, Greenville's percentage increase in total bank deposits from 2004 to 2005 was the lowest of all four counties at 3 percent. Charleston's rose 17 percent, Lexington's 9 percent, and Richland's 24 percent.

Which must mean Greenville's wealth didn't grow as fast as the other counties from 04 to 05. Or I could be misinterpreting the data.

In any case, my point about the cultures of SC's big metro areas can't really be supported -- or not supported -- by data, Sandlapper. The point was about CULTURE, which is kind of subjective by its nature, really hard to measure with data.

Oops. That top graph in my last post is supposed to be a quote from an earlier post.

[monsoon]

Great points, Spartan. Also, the presence of such companies can have future spin-off effects that we can't really see today. Who knew that when BMW chose SC that it would also be a major player in the International Center for Automotive Research project, thus having more of an economic impact on the state than initially projected?

Well BMW has been there more than a decade and it has done little to improve the lives of people in the state that don't work for that industry. The point that I was making about the above link from Campbell is that he offers nothing in that webpage that is different from the current formula.

In North Carolina, the constitution prevents the kinds of payouts that lured BMW to SC. Yet it's economy and population growth far outstrips that of SC by almost any measure. And NC has done this without even having a lottery up to this point. If Campbell really wanted to do something to better SC's furture he would come up better than some plan to lure prestige companies to the state using tax money. And BTW, that plan means that SC is in direct competition with Alabama, Mississippi, Louisanna, and the other Southern states that play this game. Yet in almost every state where these car companies are going, the states remain at the bottom of the list for per capatia income, poverty levels, economic growth and population growth. The evidence is there if one is willing to look for it.

[goodbye]

Wow. Take a look at the 2002 report from the Moore School of Business in Columbia regarding the economic impact BMW has had on the state.

Consider that for every job created at the Greer plant, 4 others have been generated elsewhere in the state.

[monsoon]

Wow. Take a look at the 2002 report from the Moore School of Business in Columbia regarding the economic impact BMW has had on the state.

Consider that for every job created at the Greer plant, 4 others have been generated elsewhere in the state.

What the report misses is how many of those jobs would be there if BMW had located across the line in GA. There are no automobile assembly plants in NC, yet NC ranks 10th in the nation in automobile parts assembly jobs. Its something like 24,500 in direct assembly and another 54,300 in related assembly.

[krazeeboi]

Well BMW has been there more than a decade and it has done little to improve the lives of people in the state that don't work for that industry. The point that I was making about the above link from Campbell is that he offers nothing in that webpage that is different from the current formula.

I understand your point about Campbell, but BMW has done more for the state of SC, specifically the state's most populous region, the Upstate, then you might think. See here.

In North Carolina, the constitution prevents the kinds of payouts that lured BMW to SC. Yet it's economy and population growth far outstrips that of SC by almost any measure. And NC has done this without even having a lottery up to this point. If Campbell really wanted to do something to better SC's furture he would come up better than some plan to lure prestige companies to the state using tax money. And BTW, that plan means that SC is in direct competition with Alabama, Mississippi, Louisanna, and the other Southern states that play this game. Yet in almost every state where these car companies are going, the states remain at the bottom of the list for per capatia income, poverty levels, economic growth and population growth. The evidence is there if one is willing to look for it.

North Carolina has pretty much found its economic niches because it was ahead of the curve. Banking in Charlotte and pharmaceuticals/biotechnology are major economic generators of NC, which has significantly contributed to the business climate in a positive way in the state, allowing it to attract other businesses and industries. South Carolina at this point is desperately trying to catch up as it really has not found its economic niche that allows it to lure companies here without the huge tax breaks. We've held on to the manufacturing industry until we have been made to shift, while other states saw the changes coming some time ago and changed ahead of time to prepare them for the future. What else are we to do at this point?

[The_sandlapper]

I have to say I'm in agreement with monsoon here. Traditionally poorer states give tax (money) incentives to "big name" companies to come in and "set up shop". The time while these companies are here they don't have to pay state taxes. So usually in return for not contributing to the economic tax pool of the state/ area they create low paying service jobs (at minimum wage or slightly greater than), then leave once these incentives are used up, then comes overseas outsorcing, sweatshops in China, Volkswagon plant to Mexico, etc.. When its said and done in 30 years it's usually the state that's left holding the bag. A better model for SC to follow would be cultivating and nurturing local grassroot business and investing enough in them locally, thereby making them strong enough to compete on a national scale. Keep the money in SC. Invest in SC don't rely on outside companies to carry you to the goal. That's what makes the difference then you can play by your own terms and outsiders will take notice and you can name your own terms. But this method does take time. But in the end I think its the best way to go!

[krazeeboi]

BMW workers aren't making minimum wage. Neither are the workers for Vought-Alenia, DaimlerChrysler, etc. Of course you have your low-wage positions that come with any industry, but by and large, those companies pay well, considering that the cost of living in SC is lower than in many other places. We've got to do something in the meantime while we carve out our own economic niche. Tourism-oriented jobs ain't gonna cut it. Small businesses are on the rise, thankfully, but they can only employ so many people at a time. It's really going to take years for Innovista and ICAR to reach the level where they become real economic engines for the state, so in the meantime, we've got to patch the leaking bucket as best as we can.

This is where I really get angry at our short-sighted leaders of yesteryear (some who are still around today) who were so concerned with other stupid issues that have kept us in the "backwater" for so long that they couldn't have the simple foresight to see that what was driving us then couldn't and wouldn't last forever.

[The_sandlapper]

I agree BMW and Vought-Alenia are higher ended jobs and that's good. I just don't think the future of America and the state of SC for that much will be manufactoring, and if that's the emphasis I believe history will be stareing us in the face once the well runs dry (ie textiles, or Michigan with the auto industry), however you do make a good point.

[Spartan]

What the report misses is how many of those jobs would be there if BMW had located across the line in GA. There are no automobile assembly plants in NC, yet NC ranks 10th in the nation in automobile parts assembly jobs. Its something like 24,500 in direct assembly and another 54,300 in related assembly.

So you're trying to say SC would be better off if BMW has located in GA or NC? LOL! that is the craziest thing I have ever heard. Lets see some facts on how much NC has benefited. I think you are over stating your point by a longshot.

BMW workers aren't making minimum wage.

BMW pays damn good money. I know a guy who got payed $18/hr just to drive cars off of the line and park them. Not too bad. Not only that, they have an insane benefits plan.

[goodbye]

The state of South Carolina just received its next great economic shot in the arm!

Click here! (More info to follow)

[krazeeboi]

As if there were ever any doubt...

Like your new icon, Skyliner.

[gs3]

The state of South Carolina just received its next great economic shot in the arm!

Click here! (More info to follow)

[goodbye]

...

Like your new icon, Skyliner.

Thanks, krazeeboi! Thought it was time for a change.

[goodbye]

I suppose it should be mentioned that the potential new Duke Energy plant in Cherokee County (Upstate) would also be a gigantic boost to the economy. Potentially billions of dollars of investment and thousands of new jobs... Sounds very impressive!

[Spartan]

I suppose it should be mentioned that the potential new Duke Energy plant in Cherokee County (Upstate) would also be a gigantic boost to the economy. Potentially billions of dollars of investment and thousands of new jobs... Sounds very impressive!

Indeed Perhaps times are changing for SC?

[mcashlv]

Because the state can't afford it. 600 jobs isn't many in a state of almost 5 million people. Likewise the state is in a horrible mess from a jobs perspective. Why doesn't he hold his dad responsible for this legacy as well.

This is true. These tax abatement schemes to lure business are a sure sign of desperation, and generate very little benefit in real terms. Usually the businesses depart as soon as the incentives dry up. Essentially the poor taxpayers subsidize the operating expenses of giant corporations in return for a few jobs. A sucker deal.

[The_sandlapper]

^I agree, and that's pretty much the point I was aiming at. West Virginia (where I went to school) is a perfect example of this.

[monsoon]

So you're trying to say SC would be better off if BMW has located in GA or NC? LOL! that is the craziest thing I have ever heard. Lets see some facts on how much NC has benefited. I think you are over stating your point by a longshot.

If you take what it cost SC to gain the plant, then yes I am saying that. If instead GA had paid taxes to put the plant in Augusta, SC auto suppliers could still suppy the plant. It's not a given they got the work just because BMW is in the state.

I can only offer up the numbers concerning NC auto parts manufacturing that I posted above. NC has more people employed in autoparts manufacturing than SC yet it doesn't give financial incentives for companies such as those offered to BMW. (the recent payoff to Dell is an exception to that) And also they are not tied to one auto manufacturer which helps during down cycles.

The bottom line is that it would be better if SC spent its tax money to make the state a better place to do business instead if spending it to payoff a prestige company to locate a few thousand jobs in the state.

[breed]

Seems to me as though we are getting a little off topic... but it naive to say that other states don't offer incentives to companies to relocate there. NC is actually very proficient at recruting efforts. It seems to me as though to some gaining the South Financial headquarters is a lose-lose proposition. If SC offers incentives, then they are doing so inappropriately. If they don't land the headquarters, then they aren't trying hard enough.

And debate it all you want, there is a positive impact to aggressively recruiting new businesses.

[The_sandlapper]

The bottom line is that it would be better if SC spent its tax money to make the state a better place to do business instead if spending it to payoff a prestige company to locate a few thousand jobs in the state.

Again, I agree whole heartedly and great point!

There are reasons why some states are better off economically than others. I think states that followed the model listed above are the ones who have been more successful. Pay attention to the little things next time in NC (roads just as an example). Is NC really more desireable than SC? Probablly not but has NC utilized its resources and created a better economic environment than SC yes.

[Spartan]

Seems to me as though we are getting a little off topic... but it naive to say that other states don't offer incentives to companies to relocate there. NC is actually very proficient at recruting efforts. It seems to me as though to some gaining the South Financial headquarters is a lose-lose proposition. If SC offers incentives, then they are doing so inappropriately. If they don't land the headquarters, then they aren't trying hard enough.

And debate it all you want, there is a positive impact to aggressively recruiting new businesses.

Well said. Lets not forget the adidtional tax base that these well-paid employees will bring.