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Foundation Forecast: New Ranking Points to Strength of Manufacturing in North Carolina

| Manufacturing

North Carolina recently topped Site Selection Group’s Best States for Manufacturing report.  While the rankings highlight the strength of North Carolina’s manufacturing sector, they also point to areas where North Carolina must stay focused to remain on top in a highly competitive national landscape.

In this month’s Foundation Forecast, Dan Gerlach, economic advisor to the NC Chamber Foundation, takes a closer look at the ranking and tracks how North Carolina stacks up to other leading states.

Meredith Archie
President
NC Chamber Foundation


New Ranking Points to Strength of Manufacturing in North Carolina

While the percentage of North Carolina workers in manufacturing has fallen over time, the industry still accounts for almost one in every ten jobs and with wages 11% above the average industry total.i Economic development recruiters focus heavily on these large employers with substantial capital investment and ability to sell their products across the nation and world.

In a recent ranking by the Site Selection Group (SSG), North Carolina ranked as the best state for manufacturing in 2024. As with other rankings, the Tar Heel state is in close competition with South Carolina, Tennessee, Indiana, and Kentucky.

The analysis begins with a comparison of each state’s metropolitan and micropolitan areas, of which North Carolina has many. The factors considered include workforce and market alignment, operating costs, and geographic positioning.

States can affect some of these indicators more than others. For instance, North Carolina cannot move itself westward. But in the areas that the state can control, North Carolina does quite well.

 

North Carolina succeeds because of its balance in the rankings. While ranking first overall, the state ranks fifth in each of the three categories. That’s enough to pull ahead as some states have better operating costs but far lower geographic positioning.

In an interview with SSG, the authors of the analysis pointed to North Carolina’s balanced tax system with relatively low burdens in property and income taxes, the quality of state and local economic development staff, and favorable demographics as particular strengths. The state’s quality of higher education and postsecondary training was also noted as a key feature.

Finally, the authors noted that having sites ready for industrial development and ample water and sewer capacity were of increasing importance. The state’s recent historic investment in water and sewer and new state support for site development through the Economic Development Partnership of North Carolina’s Megasites and Selectsites initiatives are steps in the right direction. Through the work of NC Leads, the NC Chamber Foundation is committed to setting the long-term plan for the state’s water infrastructure. In 2024, the Foundation formed a Water Resources & Infrastructure Task Force of cross-industry experts to identify key issues, prioritize needs, and propose solutions to address North Carolina’s water infrastructure challenges. An in-depth study and competitive analysis that will be used to inform recommendations and identify barriers to progress for the state’s water infrastructure is starting this winter.

Through the work for NC Leads, the NC Chamber Foundation remains laser-focused on its work to foster a high-quality workforce, competitive business climate, and improved infrastructure sufficient to keep our leading position.


iAuthor’s calculations from Q2 2024 QCEW Data found here