Success Story: The Growth of Manufacturing in the Southwest Alabama IMCP

October 2016 Newsletter

EDA Deputy Assistant Secretary Matt Erskine and EDA Policy Advisor Julie Wenah pose for a selfie with manufacturing students at Austal USA in Mobile, Alabama.

According to the U.S. Bureau of Labor Statistics, the manufacturing growth in the eight-county Southwest Alabama region has elevated job growth and wages over the past five years. From 2010 to 2015, advanced manufacturing and shipbuilding jobs in Mobile, Alabama grew 38 percent and 92 percent, respectively, as compared to the national average of nine percent and 11.5 percent. During the same period, wages in the region also increased in manufacturing by 16 percent and in shipbuilding by 23 percent.

The Southwest Alabama Investing in Manufacturing Communities Partnership (IMCP) region has a rapidly growing and diverse economy that has been driven by advanced manufacturing in aerospace, shipbuilding, steel, and chemical production. The IT/High Tech industry has benefited from the growth in the advanced manufacturing industry as this success has attracted new investments such as the location of several new IT firms to the region and the development of the Downtown Technology Corridor.

Two manufacturers, Austal USA (shipbuilding), and Airbus USA (aerospace), have risen above several other companies due to their significant growth and increased production. Austal USA, as the largest shipbuilding employer in the region with more than 4,000 employees, has contributed to this increased manufacturing through its construction of the U.S. Navy Expeditionary Fast Transport ships (EDF). Austal has been under contract with the Navy since 2008 to build 10 EDFs and recently earned a supplement to the contract to extend its production into 2022. In addition to building the EDF ships, Austal also produces the Littoral Combat ships (LCS).

Airbus USA opened its $600 million, 116 acre complex at the Mobile Aeroplex at Brookley in September 2015. The first customer delivery took place in April 2016, with JetBlue claiming the first Alabama-made aircraft, “BlueMobile,” followed by deliveries to American and Spirit airlines in May and September 2016, respectively. Airbus expects to produce a total of 16 aircraft in year one of operations, and is expected to produce four aircraft per month by the end of 2017. Currently, Airbus employs 350 and will increase operations support to 1,000 jobs at full production with the suppliers adding 3,000 jobs. Airbus currently has combined orders for more than 900 single-aisle jets valued at nearly $100 billion.

The Southwest Alabama IMCP community, known as Advancing Southwest Alabama, has become a regional leader by creating collaborations between the six rural and two urban localities in conjunction with the region’s economic development entities to support the long-term growth in advanced manufacturing and a skilled workforce.

In 2016, Advancing Southwest Alabama strengthened the economic development capacity of the eight-county region, especially in the rural counties, by creating the “first” regional ACT Work Ready Community in the state of Alabama.

By achieving the ACT Work Ready Community designation, Advancing Southwest Alabama will build local capacity in the six rural IMCP counties by closing the skills gap and linking, aligning, and matching the education, workforce development, and economic development efforts in the region.

This initiative will serve as a national model, as one of the first Work Ready Communities, to be designated as a region and create a stronger workforce that will help to fill the skills gap in the advanced manufacturing industry and sectors in the region.

The Southwest Alabama IMCP is led by the University of South Alabama in collaboration with the Mobile Area Chamber of Commerce. Laura O’Connor, of the Mobile Area Chamber of Commerce, serves as the IMCP Coordinator and Kathy Thompson, of the University of South Alabama, serves as the Project Director.