VOL. 111 | NO. 84 | Friday, May 9, 1997
lj 10/5 cates
State economic growth
brisk in first quarter
By LAURIE JOHNSON
The Daily News
Brisk activity characterized 1997 first quarter economic development in Tennessee, according to a preliminary report tracking announced new jobs and capital investments from January through March.
The report, released by the Tennessee Department of Economic and Community Development, cites a total of 5,362 new jobs and $891.9 million in capital investments associated with 206 new and expansion projects statewide.
According to the ECD, manufacturing firms accounted for the lions share of expanded and new projects (181), announced new jobs (4,461) and capital investments ($667.4 million) during the first quarter of 1997.
Announcements by 25 expanded and new non-manufacturing and service industry operations charted 901 new jobs and $224.5 million in capital investments during this period.
Memphis companies on the ECD roster of new and expanding operations include Block Drug Co. Inc., which is undertaking a $12 million expansion.
New headquarters, distribution and selected services operations projects reported during the first quarter for the Memphis area include the arrival of Amerispec, a home inspection firm that will bring 25 jobs to the area, and Genesis Direct Inc., a catalog marketing firm that will bring $24 million in capital investments and 456 jobs.
Relocation projects planned for the Memphis area during the first quarter of 1997, as reported by the Memphis Area Chamber of Commerce, are expected to add 918 manufacturing, office, mail order, distribution and laboratory jobs.
These include relocations by manufacturing corporation Willamette Industries, which represents $4.1 million in capital investments and 26 new jobs, and Technical Associates of Georgia, representing 15 new jobs.
New distribution arrivals include Kuehne & Nagel, which will employ 18, and Specialty Laboratories, which will employ 425.
Expansions tracked by the Chamber for the first quarter include projects planned by Baptist Memorial Healthcare Corp., Hardins Sysco Food Service, Sofamor Danek, Wholesale Equipment Co., Shelby Group International, United Parcel Service and Federal Express.
"As growth patterns in Tennessees healthy, diversified manufacturing and business base attest, pro-business policies under Gov. Don Sundquist continue to earn the confidence of existing and new firms of the highest caliber," said William A. Dunavant Jr., ECD commissioner.
"Their investments in expanded facilities, cutting-edge technologies and new production techniques ultimately translate into payroll jobs and improved life quality for Tennesseans in communities across the state."
ECD officials said that while announced jobs and investments are an indicator of overall economic activity, they are not intended as a measurement of the states net industrial growth.
The growth statistics compiled by the ECD do not take into account plant closings and employee layoffs.
However, analysts say the Memphis economy looks promising based on the announced jobs and investments and the prospect of the city retaining its status a full-employment economy through 1997.
"The first quarter, in terms of employment, continues to track what weve seen over the last year and a half, which is very steady, solid growth," said David Ciscel of the University of Memphis Bureau of Business and Economic Research.
Unemployment in the Memphis area stood at 4.1 percent at the end of March, according to the Tennessee Department of Employment Security.
"We continue to see relatively healthy construction sector, both in residential and commercial construction," Ciscel said. "This is both surprising and pleasing, because it has gone on for a considerable time now."
Ciscel said confidence about continued business expansion, construction of the new Wolfchase Galleria Mall and extension of the Nonconnah Parkway Memphis new "outer loop" have all contributed to the favorable construction market.
In 1996, about 1,200 new construction jobs opened up in the Memphis market. About 10,000 new jobs opened up in the service sector during 1996.
"Everything that we are seeing during the first quarter is basically indicating that 1997 so far, looks just like 1996, which is solid growth across the spectrum," Ciscel said.
The one sector that continues to look weak in the Memphis economy is manufacturing.
"We saw some good growth in the early 1990s, but in the last year and a half, from an employment point of view, it seems to have stagnated," he said.