Job creation, wage gains reflected in S.C. building boom

Manufacturing helped lead South Carolina out of the recession, setting the stage for a boost from another sector.

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The housing market in general, and new-home construction in particular, is now fueling growth, according to an economist at the University of South Carolina.

“Because of increases in disposable income, more consumers are making new home purchases instead of remodeling existing homes,” says Joey Von Nessen with the Moore School Division of Research.

The Market Edge, a Tennessee-based firm, tracks residential building permits in several states, including 14 South Carolina counties. It found that through the first nine months of 2015, permits were up 19 percent year-over-year in the Upstate and 12.3 percent in the Columbia metropolitan area.

Of the two South Carolina counties it tracks in the Charlotte metro, permits in Lancaster and York were up 21.7 percent and 63.9 percent, respectively.

Von Nessen says housing gains in the Rock Hill area are reflective of general economic development growth trends in the Charlotte metro.

Statewide, housing isn’t the only thing that’s taking off.

“Additionally, nonresidential construction is benefiting from major increases in the growth of retail trade,” Von Nessen says.

What’s driving the construction boom?

“This year represents the first time in the current expansion that we’ve seen the creation of high-wage jobs accompanied simultaneously by significant wage growth across multiple industries,” Von Nessen says. “This means that more South Carolinians are feeling the effects of the expansion.”

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S.C. tax system gets fair share of credit

South Carolina is the fairest of them all – or pretty close to it – when it comes to taxes.

WalletHub, a financial website for consumers and small business owners, ranked the Palmetto State No. 3 based on the fairness of its state and local tax systems.

Montana was No. 1. North Carolina ranked 23rd, while Georgia was 49th.

The website used a combination of tax system data analysis and an online survey to determine the rankings.

“State and local tax credits for business investments are one of the best uses of a tax policy to assist economic growth,” says one of WalletHub’s analysts, Thomas Potiowsky of Portland State University.

Meanwhile, a report by Bloomberg looked at how tax issues impact economic development (location and investment) decision making by U.S. corporations.

The study ranked Texas, Nevada and Florida as having the most favorable environments. California, New York and Illinois were the least competitive. (Other state rankings were not available.)

Key findings:

  • Half of the businesses involved in the study said state corporate tax issues influenced site selection for a recent economic development project
  • 84 percent of those surveyed were offered incentives by a state or local entities for a new development or corporate relocation
  • 33 percent of those surveyed were offered incentives to remain in their current state

The report concluded: “The gap between the most and least favorable state tax environments is determined largely by incentive prioritization.”

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S.C. communities remain friendly toward small business

Charleston, Columbia and Greenville all received positive grades on a survey of small business friendliness conducted by Thumbtack.com. The company, which connects customers to small businesses, gave each metro area an overall grade of B-plus.

In 2014, Columbia received an A-minus and Charleston and Greenville each scored a B. Overall, South Carolina received an A in 2015 following a B-plus in 2014.

A Forbes magazine ranking of The Best Small Places for Business and Careers listed Hilton Head Island 10th in the nation. Sumter was No. 162 and Florence was No. 184 on a list of 200 communities.

Other local kudos for South Carolina communities included a No. 8 ranking for Columbia on Livability.com’s list of top college towns.

“Long-time residents here experience a vibrant social scene, evolving arts atmosphere and stable economy thanks in large part to a steady stream of college students, many of whom decide to stay after graduation,” wrote the research firm.

Livability.com’s criteria included the number of 25-29-year-olds, percentage of jobs in education sector, diversity and housing affordability. Manhattan, Kansas, home to Kansas State University, was No. 1.

And for economic development at its most basic, the Charleston Farmers Market was ranked No. 7 on a list of the 101 Best Farmers Markets in America for 2015.

“In historic downtown Charleston’s Marion Square, the Charleston Farmers Market thrives with food, art, and entertainment,” wrote The Daily Meal, a food and drink website.

The website considered online popularity and the amount of local sourcing, among other things, in ranking the markets. Union Square Greenmarket in Manhattan, New York, was No. 1.

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S.C. helps U.S. maintain edge in foreign investment

The United States remains the preferred destination for industrial investment, and South Carolina continues to lead the way.

South Carolina

Map of South Carolina State

IBM recently released its annual Global Location Trends report. South Carolina was the No. 1 state in per capita job creation through foreign investment.

The IBM report also noted North Carolina, Ohio, Tennessee, Texas and Virginia for strong job creation.

The S.C. Department of Commerce pointed out that the Palmetto State was also the top state in job creation per 1 million residents. It has held the No. 1 spot in that category three times in the last four years.

South Carolina also ranked third overall in job creation through foreign investment.

Overall investment in the U.S. set records in 2014.

“Investors continue to respond positively to the country’s growing economy and central role in global value chains,” the IBM report stated.

Globally, the number of projects and related job creation increased by 6 percent in 2014. The transportation equipment sector created the most jobs through foreign direct investment in 2014, with tourism No. 2.

London was the top metropolitan area in terms of the number of projects in 2014.

“Urban areas are increasingly becoming the driving forces of national economies and the preferred destinations for companies to locate their facilities,” the report stated.

 

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Site consultants: S.C. a top state for business

There was no change at the top in Area Development magazine’s sixth annual survey of site consultants.

South Carolina again ranked third in its 2015 Top States for Doing Business Rankings. Georgia remained No. 1, with Texas in second place.

The magazine’s survey examined 21 factors across three categories: business environment, labor climate, and infrastructure/global access. South Carolina ranked second overall in business environment and labor climate.

In the various subcategories, the Palmetto State was No. 1 in cost of doing business and speed of permitting, and tied for first in incentives programs and cooperative state government.

South Carolina’s low rate of unionization and readySC workforce development program each earned a mention in Area Development’s accompanying report.

“Site consultants often have the best view of a state’s performance – especially when compared to other states,” the report stated. “They work on a variety of projects in multiple industries, interact with economic development offices, and conduct their own research.”

A consultant interviewed for the report pointed out that states within a particular region often have common strengths.

“Southeastern and Mid-Atlantic states such as Georgia, South Carolina, Florida, and North Carolina benefit from varying combinations of moderate to lower costs, proximity to Eastern and Midwest markets, East Coast ports, and established reputations as relocation destinations from the Northeast and Midwest, in particular,” said Lawrence Moretti, a principal with LFM Corporate Location Solutions.

North Carolina ranked seventh overall and was No. 8 in 2014. Florida tied for fifth place with Alabama after not making the top 10 in 2014.

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Economic development driving port growth

Recent research shows South Carolina’s economic growth through the lens of the Port of Charleston.

The real estate firm CBRE looked at annual container traffic growth and found that Charleston was the fastest-growing major port in North America. In addition, CBRE found the growth is driving additional industrial development around the port.

Comparing the amount of square footage under construction to existing square footage at each major port, Charleston is again No. 1, far ahead of second-place Houston.

Another researcher saw the growth coming. Charleston ranks No. 9 on a North American seaport index compiled by Jones Lang LaSalle Inc.

Aerial Photography: Port of Charleston

Aerial Photography: Port of Charleston

The list takes into account port operations and the real estate that surrounds it. The Port of New York and New Jersey was No. 1.

Charleston’s 40.8-percent growth in container volume over the past three years was described by JLL as “explosive.”

“The port offers strong rail connectivity, access to Western European markets and is supported by the development of new manufacturing facilities throughout South Carolina,” writes JLL in its 2015 report.

The report mentioned the port’s increased industrial base due to the creation of a rail-connected inland port in Greer. With Volvo announcing it would build a Lowcountry factory, JLL expects continued growth at the Port of Charleston thanks to the carmaker and the potential suppliers it will attract.

An economic impact study conducted this year by the University of South Carolina concluded that the S.C. Ports Authority provides a $53 billion annual economic impact to the state. That includes the value of goods and services produced in South Carolina that can be attributed to the SCPA.

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Fairfield County, Charleston, Greenville earn national kudos

In the latest round of media kudos for various South Carolina communities, Fairfield County was lauded for its manufacturing economy.

Fairfield ranked 14th in the nation in manufacturing job growth in 2014, adding 1,389 jobs. According to research by Headlight Data, Wayne County, Michigan, was No. 1, adding 4,225 jobs.

Fairfield County’s 68.1 percent growth rate far outpaced Wayne’s 5.3 percent rate. Other top Palmetto State performers were Laurens County (No. 17, 1,257 new jobs, 21.9 percent rate) and 38th-ranked Charleston County (907 jobs, 6.4 percent growth rate).

The theme in Charleston might be work hard, play hard, because readers of Travel + Leisure magazine ranked the Holy City as the No. 2 travel destination in the world, behind only Kyoto, Japan.

“It’s the only U.S. city represented in the overall list,” the magazine pointed out. “South Carolina’s oldest city has consistently charmed T+L readers with its quintessential antebellum aesthetic and old-fashioned Southern hospitality.”

Greenville, meanwhile, was recognized for its appeal to entrepreneurs.

NerdWallet (a personal finance website) and Entrepreneur magazine ranked Greenville No. 9 in its “Top Small Cities to Start a Business.” Alpharetta, Georgia, was No. 1. The ranking looked at criteria such as number of businesses per 100 persons and percentage of businesses with paid employees.

“Entrepreneurs are attracted to Greenville’s location, midway between the region’s economic powerhouses of Atlanta and Charlotte, as well as its low cost of living,” the report stated while also mentioning Greenville’s strong business community and local economy.

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