“The best thing that Aiken’s done is never give up on manufacturing when a lot of parts of this country have. There is still a future, and this shows that there is,” said University of South Carolina economist Doug Woodward on Thursday, a day after the Japanese tire maker announced its decision to spend $1.2 billion on a new plant and the expansion of its existing facility in Graniteville.
“They’ve had success there, and they’re building on that success. … This is a substantial capital investment, and there’s not a lot of that going around these days,” Woodward added.
Meetings between Bridgestone representatives and county officials continued Thursday on construction plans, said Will Williams, the director of the Economic Development Partnership for Aiken and Edgefield counties.
Bridgestone will spend $900 million on a new 1.5 million-square-foot plant in Sage Mill Industrial Park to make off-road radial tires. Work on clearing the site will begin in the middle of October, Williams said. It will ramp up to 550 jobs.
Bridgestone will also spend $346 million to expand its existing passenger tire plant, which should begin in November. That will create 122 more jobs.
What’s the impact of $1.2 billion in capital outlay? Just compare it to the gross metropolitan product of the area, about $17 billion a year, said Simon Medcalfe, a finance professor at Augusta State University.
“South Carolina does a good job of attracting these kinds of jobs. Think of some of the headline ones that they’ve had over the last decade, BMW plant and the Boeing plant,” Medcalfe said. “We in the Augusta area do a good job in manufacturing businesses. You think about the decline in manufacturing in the United States, and we here have an outsized presence.”
According to the Georgia Department of Labor, there are 19,900 manufacturing sector jobs in the Augusta metro area.
“So much bad news, this is a shot in the arm, a real boost to confidence in what we should feel about our economy in Aiken and throughout the state,” Woodward said. “It is going to make a difference over the long term. It will have an immediate impact; there will be some construction. But it is a long-term commitment to the region. And I think that says a lot about the region’s ability to compete.”
It also comes at a good time for Aiken County because of the contraction at Savannah River Site.
“You need something to compensate,” Woodward said.
The jobs don’t directly correlate, nuclear scientist to tire production, but the new jobs will have an impact on the working class in the region.
When considering the economic impact of the project, it doesn’t stop with the jobs at Bridgestone. Manufacturing jobs have one of the highest multiplier effects, where the payrolls get pumped back into the economy and indirectly create or sustain other jobs in the community.
“The wages are pretty good. This is going to be an above-average multiplier effect as every direct job will result in two to three additional jobs to the region,” or 1,700 to 2,500 jobs, Woodward said. “It is good for retailers and other services.”
Williams said Bridgestone currently pays more than $19 per hour at the passenger tire facility, but there is no information about whether the new facility would pay more or less.
Williams said the first passenger tire to go down the line at the expansion should happen in the summer of 2013. The first phase of construction on the new tire plant should be completed then, too, although the production won’t begin until the beginning of 2014.
Williams said hiring for the off-road tire facility will begin early next year.
“Since this technology doesn’t exist anywhere except Japan, there’s going to be some substantial training (in Japan),” Williams said.