AEDC annual report shows 95 industrial agreements signed in 2008.

THE ARKANSAS ECONOMIC DEVELOPMENT Commission offered incentive packages to 170 companies in 2008 and signed agreements with 95 of them, the commission's annual activity report reveals.

While the number of agreements was off from a banner year in 2008, when 104 incentive agreements were signed, the total number of jobs that will be created if all come to fruition--6,993--was by far the highest since legislation requiring annual reporting was passed in 2001.

The AEDC's biggest coup of 2008, in terms of jobs, was a manufacturing plant for Little Rock that would employ 630. This appears to be a reference to Polymarin Composites, a maker of rotor blades for the wind industry that made its announcement in October. But its average hourly wage of $15.04 was just middle-of-the-pack. The highest average wage--not including a two-person Web development business in Sherwood--was $37.39 per hour for 45 new workers at a manufacturing plant in Hot Springs.

The total investment in the 95 new projects will exceed $1.7 billion, which compares with $1.58 billion for the 104 projects announced in 2007.

That's the good news in the report. It also shows that the average hourly wage of jobs to be created by the incentives, $14.74, is lower than in 2007 ($15.74) and, thus, will take longer to pay back in the form of increased taxes.

As of 2008, the average hourly wage in Arkansas was $14.17, well below the national average of $17.74 and lower than in the seven states that border Arkansas. Not surprisingly, then, Arkansas has a higher poverty rate--17.6 percent--than the nation (13 percent) or the region (15.1 percent).

The report also shows that 30 factory and plant closures cost the state 4,227 jobs in 2008. While the report doesn't name specific companies, the descriptions are enough in many cases: the 335 chicken-processing jobs lost at Clinton refers to the closing of the Pilgrim's Pride plant, while the 800 jobs lost due to a plant fire at Booneville is a reference to Cargill.

Another 30 industrial projects with the potential to create 6,680 jobs were either canceled or located outside Arkansas. And the ones that got away had a higher average hourly wage, $16.10, than the jobs that did commit to Arkansas.

Itemized reasons that the 30 businesses declined Arkansas' incentive offers include general economic conditions and more attractive offers in other states, including Oklahoma, Mississippi, Alabama, Louisiana and Missouri.

The manufacturing sector in Arkansas lost 16,200 jobs between 2006 and 2008, according to the AEDC report. Since 1998, more than 71,000 manufacturing jobs have disappeared.

By Gwen Moritz

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