West Virginia: Business at the Speed of Life
22 Nov, 2013
By Rachel Duran
West Virginia is ramping up its workforce development efforts through the reestablishment of the cabinet level Workforce Planning Council, a seven-member council, which includes Gov. Earl Ray Tomblin or his designee.
“It is a big change from the past,” says Keith Burdette, secretary, West Virginia Department of Commerce. “The council has the ability to make things stick; the governor has put all the decision makers in the room.We are finding gaps and duplications and the good news is that this group has the power to change things.”
The formation of the council complements efforts such as the reformation of the state’s community college system, which has taken place during the last several years, Burdette notes. “We are placing a greater emphasis on workforce training. We are hearing strong, positive comments from companies in regard to advancing their needs.”
West Virginia’s officials are also enhancing their international business relationships. In October, Gov. Tomblin led a trade mission to Europe, expecting to stop in five countries: Spain, France, Germany, Switzerland and Italy. European companies play an important role in the state’s economy, where more than 80 European companies employ more than 10,000 West Virginians. What’s more, in 2012, nearly one-third of the state’s $1.3 billion in exports went to Europe. The governor was expected to meet with companies doing business in the state and prospects, as well as participating in events to promote the state’s business environment.
Burdette says one of West Virginia’s leading business advantages is the ability to provide predictability. “We want to make sure businesses can plan and that the state isn’t their problem as far as their ability to plan going forward,” he says.
For example, the state is in the third year of a multiyear phase down of its corporate net tax, which will balance out at 6.5 percent in 2014. Also, two years remain in the phase down of the business franchise tax, which will be eliminated in 2015.
Burdette says the small size of the state empowers leaders to make decisions quickly so as not to impede businesses.
Other advantages are found in the state’s workers’ compensation insurance system, where premiums have decreased 63 percent since the system was privatized a few years ago. The state’s unemployment compensation system is also secure. During the Great Recession, West Virginia was among 18 states that did not have to borrow from the federal government to pay unemployment funds, Burdette says.
Industries and Innovation
West Virginia features a diverse range of industries, highlighted by its energy sector. “We are a huge energy producing state,” Burdette says. “We are one of the country’s largest exporters of coal, the country’s third-largest producer of coal, and we are one of the country’s largest producers of gas.”
West Virginia benefits from investments relating to the Marcellus Shale play (which comprises multiple states), where companies are spending billions of dollars on gas processing, fracking and installing pipelines.
Burdette says state officials have long recognized what industries they can compete for. “We do not have thousands of acres of flat property,” he says. “We match up with companies that need a smaller footprint.”
Industry clusters in West Virginia include aerospace (primarily in north central West Virginia); automotive; biometrics (primarily in the central part of the state), and distribution.
Recent noteworthy projects include the announcement by Toyota Motor Manufacturing, West Virginia that it will conduct a $90 million expansion at its Putnam County facility. The company plans to expand production of transmissions from half a million to 740,000 annually. This year, the company celebrated the production of its 10 millionth powertrain since locating to the state in 1996.
In another announcement, Gestamp, the world’s largest auto stamping company, has invested in the first phase of a several hundred million dollar plant in south Charleston, Burdette says. The company will create 400 jobs during the next couple of years.
Also in the auto sector, NGK Spark Plugs Co. Ltd. has consolidated all of its North American manufacturing operations to Kanawha County. The expansion is a $15 million investment.
In logistics activities, investment is strong along the Interstate 81 corridor in the panhandle region of the state, Burdette notes. “Last year, Macy’s finished their largest fulfillment center in their entire network, more than 1 million square feet,” he says. “With seasonal staff, they will have 3,000 people employed at the facility.”
In the manufacturing sector, Unilin Flooring is expanding its facility in Holden (Mingo County), adding 80 jobs and a second shift to expand the production of hardwood and laminate flooring. In Hardy County, American Woodmark Corp. is investing another $15 million, adding 187 jobs.
In other projects, in Huntington, the customer service location for Amazon.com is part of the company’s plan to add 7,000 jobs across 13 U.S. states. Etech Global Services Inc., a business process outsourcer, will open its first operation in the state with 40 jobs initially, and grow to 200 employees. TLK Group LLC, which conducts customer service management, was expecting to open in October, initially employing 150 to 200 people.
Talent and Education
Burdette says the West Virginia workforce is tied for third place in the country for the lowest turnover rate in manufacturing businesses. “People stay at their jobs, and they are loyal to companies they work for, which reduces turnover costs,” he says.
Don’t take his word for it — visit www.businessatthespeedoflife.com
to hear business leaders outline why they are productive in West Virginia, which includes a strong quality of place component. In one video, Paul Lambert of STaSIS Engineering says: “We’re very pleased in West Virginia. We were impressed with the openness of state government to work with us, and work with us in ways that were specific to our business. It was obvious to us that it was a state government that was paying attention to individuals.”
West Virginia is located in the Mid-Atlantic region, and within a day’s drive of 50 percent of the population of the United States. That network will expand with the opening of the Heartland Intermodal Gateway in Prichard in 2015.
From the major cities in the northern and eastern panhandles of West Virginia, air passengers can access Pittsburgh International Airport and Washington Dulles International Airport.
In regard to water transportation access,Parkersburg is less than 200 highway miles from the international seaport at Cleveland. Martinsburg is less than 200 miles from the port at Philadelphia, less than 100 miles from the port at Baltimore, and less than 50 miles from the Virginia Inland Port at Front Royal.
West Virginia consists of many small towns, where the largest town has 65,000 residents. The metro valley region of Charleston and Huntington is home to a quarter of a million people.
This year, West Virginians have been celebrating the state’s 150th year anniversary. It is the only state born from the turmoil of the Civil War, which “today welcomes those looking for great outdoor adventure, scenic drives, unique culture and heritage, festivals, entertainment and fantastic food,” according to www.wvtourism.com.
“We are a spectacular place to live,” Burdette says. “As a developer I struggle to find flat land; however, we are a picturesque state, with whitewater rafting, skiing, hiking and golfing.”
Illustration by vegadsl at Free Digital Photos.net