Chattanooga growth continues to be strong
The Chattanooga area never lost momentum in wooing economic development projects despite the coronavirus, and there’s probably a stronger pipeline today than a year ago, an official says.
“The momentum never really stopped in terms of inquiries and projects that had been showcased before March 12,” said Jim Vaughn, who recently wrapped up a year as the Chattanooga Area Chamber of Commerce’s board chairman.
Mid-March was when the economy started locking down due to the virus outbreak. The chamber launched efforts to serve as a resource to address business and other needs in the city, said Vaughn, who is Chattanooga market president of Truist Bank.
“We all had to experience and navigate uncharted waters in COVID-19,” he said.
But in terms of jobs recruitment, Vaughn said it’s apparent that companies can work remotely and Chattanooga is benefiting from that trend.
Vaughn will officially turn over the top volunteer leadership post at the Chattanooga Chamber on Wednesday to American Waterworks Vice President Valoria Armstrong, who is taking the reins as chamber chairwoman at the group’s annual meeting.
Vaughn said the business group is seeing companies deciding they can come to Chattanooga from other locations and operate efficiently and gain the benefits of the city’s natural resources, cost of living and lower tax structure.
Chattanooga, like nearly all cities, has suffered due to the coronavirus as business has slowed in the entertainment, hospitality, travel and retail sectors. Although employment has rebounded some
and retail sectors. Although employment has rebounded some from the low point reached in April when much of the economy was shut down, employment in metropolitan Chattanooga during June was still down by 20,552 jobs, or 8%, from the levels a year earlier.
Nonetheless, Chattanooga’s jobless rate in June was still below both the state and national averages. As the economy recovers, Vaughn said many businesses are recognizing they don’t have to be in a highly urban environment but locate in midsize cities with lower cost such as the Scenic City.
“It positions Chattanooga very well,” he said.
Vaughn mentioned filter manufacturer Micronics Engineered Filtration Group’s decision this summer to relocate its headquarters from New Hampshire to Chattanooga’s mixed-use center called The Bend.
The company, which already has operations at The Bend on Riverfront Parkway, cited cost of living, the talent pool and a location that is “on the rise.”
“We felt Chattanooga had the most to offer,” said Micronics Chief Executive Chris Cummins.
Jimmy White, the Chattanoogan whose group is redeveloping the former 112-acre Alstom office and manufacturing site into The Bend, said mid-size cities such as Chattanooga have an advantage during the coronavirus pandemic.
“We’re seeing people leave Atlanta or New York where high-rise office towers are and … where it’s an issue,” White said.
He expects mid-size cities in business friendly states such as Tennessee, Florida and Texas to do well in capturing economic development projects in coming years.
“It’s used to be Wall Street where you had to have close proximity to,” White said. “Now you can do [work] from anywhere. What I’ve seen is COVID19 accelerate trends which were already happening.”
People were already leaving greater New York, with that number to hit more than 1 million this year, he said.
CHATTANOOGA CLIMBS
Vaughn said the chamber’s Chattanooga Climbs five-year economic and talent development effort which started a year ago has shown solid results.
For example, the effort garnered in the past year planned capital spending of $574.7 million, the chamber said, or more than half of the 2024 goal of $1 billion of added investments in new an expanding businesses. That was greatly aided by McKee Foods Corp.’s $495 million expansion unveiled earlier this year.
Announcements on which the chamber worked yielded 824 direct jobs, or about 16% of the 5,000 five-year goal, the business group said. With indirect jobs, the number comes in at 1,440.
But Vaughn said continued investment in economic development is needed in Chattanooga.
The chamber set a $15 million fund-raising goal, or garnering $3 million annually over five years, which would be a record amount for economic development, he said.
“We’re blessed to say the commitment of Chattanooga is still there today,” Vaughn said. “We continue to feel good about our vision to carry out our strategies. We’re tracking very well.”
Vaughn said the target sectors in the economy identified in Chattanooga Climbs such as automotive, machinery manufacturing, outdoor products, specialty foods, back office jobs, freight services and engineering services still remain.
But, he said, given today’s business environment, the city may need to be more flexible in terms of workforce.
Vaughn said he sees a lot more white-collar job opportunities and people with high technical training potentially relocating to Chattanooga.
“Wages may accelerate and be more positive,” he said. “You have to take advantage of what the environment gives you.”
The city of Chattanooga, Hamilton County, EPB and TVA collectively provide more than $1 million a year to the Chattanooga chamber Foundation to support economic and talent development programs for Hamilton County. The chamber raises even more private funds and membership dues from businesses to support its operations.