INVESTOR NEWSLETTER - MAY 2009
FDIC and Boeing Add Jobs to Jacksonville Economy
The FDIC selected Jacksonville, over other sites, for a new satellite office building that will be home to as many as 500 new jobs beginning in August. Jacksonville was selected because of its rich labor market.
These specialized jobs will fall into the high-wage category and include a variety of skills from banking to financial securities, accounting and legal. In fact, dozens of lawyers will be included in this process. The office will operate between three and five years as it liquidates the troubled assets from failed financial institutions.
WorkSource and Cornerstone are assisting the FDIC in identifying employee options. The new center will be located near Baymeadows and I-95. This is a great coup for Jacksonville and will be a real boost to our economy.
Additionally, the Boeing Company is bringing a project that will expand its aircraft structural repair facility capabilities at Cecil Commerce Center. This operation will add 60 jobs this year with an average salary of $60,000. These jobs are relocating from Arizona and Cornerstone, WorkSource and FSCJ have been helping recruit key talent for the transition to Jacksonville. This expansion will strengthen Boeing’s position at Cecil and will add more capability for F/A-18 Hornet and Super Hornet repairs and upgrades. The Jacksonville Aviation Authority provides Boeing with long-term leases on two major hangers and there is room to grow.
With the addition of these two projects more than 1,500 new jobs have been announced this year.
Reality Check a Rousing Success
May 21 was a hallmark date when nearly 300 business and governmental leaders came together at the World Golf Village to conduct an exercise that is charting the way in which Northeast Florida will grow during the next 50 years. These leaders, supported by nearly 100 volunteers, strategized the issues of population density, location and needed infrastructure as a way of calling attention to growth management opportunities and the need for regional priorities.
Cornerstone was a Reality Check partner for a program that was sponsored by the Urban Land Institute and staffed by the Northeast Florida Regional Planning Council. Implementation of the results will begin and extend over the next 18 months.
CEO of CSX to Speak at Second Cornerstone Lunch
We are excited that Michael Ward, chairman and CEO of CSX, will be the featured speaker for the second Cornerstone luncheon on Friday, June 5. His presentation, Sustaining Business the CSX Way: The Keys to Their Success, will explore what CSX is doing to invest in its network for future growth and how core values can help a company overcome difficult circumstances and thrive as a business. Ward will also discuss his perspective on Jacksonville, including the developments at JAXPORT and what they mean for our region.
Be sure to mark your calendars so you don't miss this opportunity to hear how CSX is meeting the challenges of our ever-changing economy. The event will also include special guest, Jack Del Rio, Head Coach of the Jacksonville Jaguars. The luncheon will be held at the Hyatt Regency Jacksonville Riverfront, from noon to 1:30 p.m.
Legislative Progress Report
Cornerstone and the Business Advocacy department have been hard at work during this last legislative session. A number of business friendly provisions passed during session and several economic development related bills passed out of session. Gov. Crist came to Jacksonville last Thursday to sign two key bills that we vigourously pursued.
SB 2034 sponsored by the Senate Commerce Committee and guided through the process by Senator Jim King, and HB 7031 introduced by Rep. Jennifer Carroll as Chair of the Economic Development and Community Affairs Policy Committee is a bill aimed at updating, expanding, and revising several areas of economic development. The bill does the following:
- Allows us the ability to expand our incentives to more target industry companies.
- Provides an extension for companies that are not able to meet their job creation commitments due to the downturn in the economy.
- Establishes a streamlined review and approval process by the state government for all economic development incentives.
Finance and Insurance Services - A Cornerstone Target Industry
In our last newsletter, we took a closer look at the life sciences industry. This month we will focus on the finance and insurance services industry, the growth we have experienced and our goals for the future.
Over the last decade our region has seen significant growth of high-wage jobs in the finance and insurance services industry, with several deals over the last two years:
- Fidelity Investments - established a regional customer contact center in 2006 that brought more than 1,200 jobs to our region.
- Deutsche Bank - opened a global technology and operations center, bringing 1,000 jobs to Northeast Florida.
- Blue Cross and Blue Shield of Florida - recently built two new buildings on its campus, investing $57 million in our region.
Also in the news is Fidelity Information Services (FIS) for its acquisition of Metavante Technologies, positioning FIS for growth as the world's largest provider of technology services to financial institutions. Other financial services companies adding jobs this year have included American Home Mortgage Servicing, Tax Defense Network, Liberty National Life Insurance and EverBank.
Finance and insurance services employment in Jacksonville remains steady from a year ago at 60,000. Where we have experienced the greatest amount of success has been in shared services centers and other back office operations. Despite the current downturn in the economy, we believe Jacksonville still offers a competitive cost environment for companies like Chase, Bank of America, Wachovia, Citi and others.
For more information on our finance and insurance services industry, contact Cathy Chambers, vice president of Business Development, at (904) 366-6667 or Cathy.Chambers@jacksonvillechamber.org.
Cornerstone and JEDC Win FEDC Award
Cornerstone and the Jacksonville Economic Development Commission (JEDC), won the “Deal of the Year” Award at the 2009 Florida Economic Development Council conference in Orlando. Cornerstone and the JEDC received this award for their hard work and dedication to the Deutsche Bank project that brought an international bank operations center and 1,000 jobs to Jacksonville.
Economist's Corner
In our March newsletter we had the opportunity to hear about the current state of the economy from an economist at Bank of America. This month we got an updated overview of the economy from Nathaniel Karp, BBVA Compass Bank's Chief Economist. Karp began by saying that when discussing the current conditions of our economy it is important to note that even though economic indicators remain weak, those "negative" surprises have diminished significantly. As a result, the uncertainty in our economic outlook has diminished as well. Financial markets have reacted positively, rebounding from their lows in March, and if these trends continue the economy should bottom out in the third quarter and begin its move toward recovery. Some sectors will most likely take a bit longer to recover:
Housing Sector
- Inventories have recently diminished by around two months worth of sales, yet remain elevated.
- New home sales appear to be recovering, but still remain down by about 30 percent from last year.
- Home prices will continue to decline for a few more months.
Business Profits
- Profits are adjusting sharply as a result of weaker sales both domestic and abroad.
- Labor market recovery remains limited and nonresidential investment continues to contract.
- Market recovery is also affected by the average household's willingness to increase savings.
While we were slightly more affected than some areas of the U.S. by the economic downturn, we are seeing the initial signs that our region will "hit bottom" before other regions and our recovery will begin sooner. In Jacksonville, job growth appears to have reached its lowest level and is starting to show improvements, especially in industries such as leisure and hospitality.
While there is still a ways to go to complete recovery, the strong fiscal stimulus package will provide some support and the potential impact remains uncertain. So, while the economic recovery is imminent, the growth rate looks to remain low a bit longer.
Save the Date: Strategic Regional Planning Forum
Cornerstone, on behalf of Enterprise Florida, invites you to to attend a statewide Strategic Regional Planning Forum, Wednesday, June 10, from 1:30 to 4 p.m. at St. Johns County Convention Center at World Golf Village. Join other business, community and local government leaders to identify issues that are important to Northeast Florida's economic development future. You will have the opportunity to discuss and provide recommendations that will brand Florida as a leader in knowledge-based jobs, leading-edge technology and competitive enterprises of the 21st century.
Sincerely,
Greg Smith
Cornerstone Chair
Jacksonville and Northeast Flordia President, Bank of America
Baker, Clay, Duval, Flagler, Nassau, Putnam and St. Johns Counties
3 Independent Drive • Jacksonville Fl 32202 • 904.366.6639
bizrelo@jacksonvillechamber.org • www.expandinjax.com
Where the Future Leads®