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Alabama manufacturers add jobs for a fifth straight year, but growth has slowed

Posted by IndustryNet on Tuesday, June 13, 2017




alabama-manufacturing-2017According to new data released this morning by MNI, Alabama’s manufacturing workforce inched up over the past year, with 1,041 new net jobs created between March 2016 to March 2017, or about a half percent.

This is the fifth straight year the state has posted an employment gain, but jobs have been added at a slower rate than recorded in MNI’s previous surveys.

Challenges to growth

Data collected by MNI, compiler and publisher of the industrial information that powers IndustryNet, shows factory employment in Alabama skyrocketed 28% over the past five years, with the strongest gains recorded between March 2012 and March 2015, as automakers and suppliers to the auto industry flocked to its borders, lured by Alabama’s low labor costs and attractive business incentives.

Jobs in the state’s transportation equipment sector surged 18% in those years, with the industry overtaking food processing as the state’s top sector by manufacturing jobs, according to MNI’s industrial data.

Gains over the past two years were much softer, however, with jobs inching up just a half percent each year, and employment in transportation equipment barely budged. New challenges have emerged as the dollar grows stronger, global competition increases, and other states in the south refine their competitive edge. And, as manufacturing becomes more technologically advanced, finding workers with appropriate skill levels is increasingly more difficult.

Which begs the question: is Alabama’s manufacturing sector at a turning point?

Looking ahead

Most signs suggest Alabama’s manufacturing sector will continue to hold its own, if not add jobs in the coming years. Despite the challenges the state faces, new manufacturers, both foreign and domestic, continue to be drawn to its borders – and a few new auto plant announcements bode well for that industry. Germany-based Broetje Automation broke ground on a new design and assembly plant to support Airbus production in Brookley; auto supplier Grupo Antolin announced it will set up shop in Birmingham; and Polaris started up production at its new on/off-road vehicles plant in Huntsville.

In addition, Alabama continues to step up its many incentive programs and the state has gone a long way to help close the skills gap, partnering with community colleges and spearheading successful worker training and investment programs. Innovative projects like G.E.’s additive manufacturing program have cropped up across the state, suggesting a growing focus on technology and innovation as the state moves further into the 21st century.

Where manufacturing is thriving in AlabamaGRANDMA

MNI’s survey of Alabama manufacturers showed growth was most pronounced in the Southeast region, which added 1.7% to its industrial workforce. The Northwest added 1.4% and jobs in Northeast Alabama inched up by 326. Southwest Alabama lost jobs, however, down 1.6% over the past year. Manufacturing job gains were recorded in Montgomery, up 1.2% and Decatur, up 1%, and nominal declines were seen in Birmingham, Huntsville and Mobile.

By the Numbers

Alabama’s 4,698 industrial companies employ 296,348 workers. Here’s a breakdown of the numbers:

The top five industries in Alabama based on number of jobs:

1. Transportation Equipment: 44,848 jobs
2. Food Processing: 33,352 jobs
3. Fabricated Metals: 26,725 jobs
4. Industrial Machinery: 23,585 jobs
5. Lumber & Wood Products: 20,598 jobs

The top five cities in Alabama for number of manufacturing jobs:

1. Birmingham: 28,627 jobs
2. Huntsville: 24,048 jobs
3. Montgomery: 16,247 jobs
4. Mobile: 15,119 jobs
5. Decatur: 9,754 jobs

Sectors adding jobs over the past year included rubber/plastics; furniture; lumber and paper products, while petroleum products; textiles; and primary metals lost jobs.

Alabama’s top manufacturers

Not surprisingly, the transportation equipment sector dominates our list of Alabama’s top industrial companies. The state is home to some major names, involved in everything from shipbuiliding to coal mining, and, of course, auto assembly.

1. Austal USA (Mobile) –4,230 employees. Austal is a major manufacturer of defense and commercial ships. Their shipyard in Mobile recently underwent an expansion in response to increased federal contracts.

2. Honda Manufacturing of Alabama, LLC (Lincoln) - 4,000 employees. This Honda manufacturing location specializes in light truck production, including the Ridgeline pickup truck and Acura MDX and is the sole maker of the Honda Odyssey minivan.

3. Mercedes-Benz US International, Inc. (Vance) - 3,000 employees Mercedes-Benz started up production in Vance back in 1997, and has since grown to be a top industrial employer, tied with Hyundai for third place. The Mercedes-Benz C-Class and GLS-Class are among the vehicles produced here.

4. Hyundai Motor Mfg. Alabama, LLC (Montgomery) - 3,000 employees Hyundai’s Montgomery plant stands as the company’s first U.S. plant, established in 2005, with its first vehicle rolling off the assembly line in 2006. Workers at the 2-million square feet location assemble both the Sonata and Elantra sedans.

5. Warrior Met Coal, LLC (Brookwood) - 2,698 employees. Warrior mines metallurgical coal from the Blue Creek coal seam underground mines, and serves the steel industry.

This report is based on MNI’s extensive manufacturing profiles, which can be accessed as a database subscription. MNI data also powers IndustryNet, a one-stop resource that helps industrial buyers find suppliers of 10,000 + products and services. To connect directly with industrial companies in Alabama and across the U.S. start your search on IndustryNet.com.

If you are doing business in Alabama, we'd love to hear from you! Where do you see Alabama manufacturing headed? Post your comments below. 

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