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AEDC Reports Increased Economic Development

2 min read

Last year was a banner year for economic development in the state, according the Arkansas Economic Development Commission’s annual activity report for 2007.

The report, created by Act 1282 of 2001, gives the Arkansas Legislative Council and the House and Senate Committees on Revenue & Taxation a good look at the state’s economic health – both good and bad.

Among its findings:

• The AEDC signed 104 incentive agreements in 2007 out of 150 agreements that were offered. Twenty-five were new businesses and 79 were expansions. In 2006, the AEDC signed only 85 agreements out of 153 offered.

• Upon completion, there will be a net gain of 6,616 new and expanded jobs – the most since 2001. The number of new jobs, 3,266, was the most since 1998.

• Total new capital investment in the projects rose to $1.58 billion – an AEDC record in infrastructure investments. About $1.06 billion of that is from expansions of existing businesses, which the report said indicates a commitment to remain and expand in Arkansas.

• The average hourly wage among the incentive agreements in 2007 was $15.74 or $32,739 a year, substantially above the state per capita personal income average of $14.45 or $30,060 a year.

On the flip side, out of those 150 agreements offered, 14 will not locate in the state, three projects have been put on hold, 11 are still active but no decision has been made, and 18 are projects that have been or are expected to be announced this year.

The 14 no deals and three holds, if they had agreed, would have created an additional 5,635 jobs with an average hourly wage of $13.14 – dragged down by two call centers, both of which would have paid $10 a hour or less.

The report also gives an overall look at the changing Arkansas economy.

From 2000 through 2007, manufacturing plant closures have resulted in the loss of 51,100 jobs, brought about by globalization and technology. During 2007, the loss was 2,548 manufacturing jobs.

As Arkansas transitions to a more knowledge-based economy, other sectors have more than made up for the loss of manufacturing jobs.

Education and health services have added 27,000 jobs over the seven-year period. Government has grown by 19,600; the leisure and hospitality business added another 13,600 workers; and professional, scientific and technical services grew by 9,700.

As part of its plan to prevent more closures and loss of jobs, AEDC Director Maria Haley created a Business Retention & Expansion Division to work with existing businesses to stimulate job growth and expansion.

AEDC’s Existing Workforce Training Program assisted 183 companies last year by providing training to 8,976 workers. Its Business Industry Training Program assisted 51 different companies in training 3,265 workers.

The report said that through the first four months of 2008, incentive agreements have been signed that would create 2,869 new and expanded jobs. If that trend continues, it said there is the potential to create 8,600 jobs this year.

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