Bringing Home the U.S. Bacon

October 30, 2006

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At IMT, we've discussed the impact that outsourcing and offshoring activity has on the U.S. economy. Well, truth be told, there are some pretty strong indicators that operations are expanding in the U.S. Wouldn't that be a refreshing change of pace?

Kicking things off is the Salem-News, which recently published an in-depth story about PepsiCo creating a new manufacturing, bottling and distribution facility in South Albany, Oregon. The $250 million structure will create around 500 family wage jobs with average salaries of more than $45,000 in addition to full benefits for workers. Governor Kulongoski said the creation of the new structure, to break ground in Spring 2007, could not have been possible without collaboration between the government and private sector. Said the governor:

The partnership between state and local government and the private sector that helped make this announcement possible represents the type of collaboration needed to keep our state's economy competitive and strong. I congratulate PepsiCo on their decision, good corporate stewardship, and long-term investment in our state.

Oregon has gained more than 135,000 new jobs since 2003, due in part to the state's aggressive Industrial Lands Certification program to expand Oregon's inventory of shovel-ready sites. The state now has the fifth-fastest-growing economy in America.

Moreover, Oregon isn't the only state that is making itself attractive to manufacturers. As Expansion Management points out, North Carolina is also in on the action, thanks to Carolina Precision Plastics investing $4.5 million over the next three years to expand its outfit in Greensboro. Check it out:

While wages will vary by job function, the average weekly wage of the new jobs will be $736 plus benefits, which is more than the Guilford County average weekly wage of $659 not including benefits.

President and CEO Brian Tauber said the initial expansion search focused on out-of-state facilities, but the support he's received from the state, county and city has enabled his company to keep operations in North Carolina.

While the Carolina Precision Plastics deal isn't exactly a huge one, every little bit counts…and who knows, maybe it'll serve as a case study for other manufacturers in the area to stay put and expand.

Wood laminate manufacturer Clarion Flooring, according to The Derrick, plans to build a new laminate facility next to its Paint Township plant. The 300,000-square-foot facility will be used to manufacture wood laminate flooring and will cost about $40 to $50 million. It is projected to be in full production by next spring, providing 90 to 100 new jobs. Not too shabby.

Hell, even popular overseas furniture-maker IKEA, which has morphed into the Wal-Mart of furniture stores, is creating its first factory in the U.S., according to FurnInfo. Located in Danville, Virginia, the factory will produce a variety of wood-based IKEA products such as EXPEDIT bookshelves, LACK coffee and side tables, MAGIKER modular entertainment systems and PAX wardrobe frames. Pending permits and construction, the facility will open in early 2008 and will create up to 740 jobs. The 810,000 square-foot future Swedwood factory will be built on 209 acres in Cane Creek Centre, in the City of Danville, VA – in Pittsylvania County, VA – approximately 50 miles north of Greensboro, NC.

"The close proximity to many IKEA stores and distribution centers, coupled with good regional infrastructure and available land, make Danville ideal for this North American production facility," said Bengt Danielsson, North American president of Swedwood.

So there you have some pretty fine examples of manufacturers big and small taking advantage of some of what the U.S. has to offer. Is this just a coincidence, business as usual, or a sign of things to come?

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