CHARLESTON, S.C. — In 2009, Boeing came to South Carolina — in a big way.
The manufacturing plant in North Charleston was set to employ 4,500 people; it now employs 8,000. It started out making the aft parts of 787 Dreamliners; it now manufacturers 787s and is the sole manufacturer of 787-10 planes. It started out with a 1.2 million-square-foot facility; it has plans to expand its footprint even further.
But it didn’t come without a price tag. Some say the state attracted Boeing with a $900 million incentive package. For its part, Boeing promised to invest in a $750 million facility and create 4,500 jobs. The details of the incentives package were never made public, but estimates by the Charleston Post and Courier came up with the $900 million incentives package — most of which were property tax breaks over 30 years and “up-front money to be given to the company through state bonds at a cost of roughly $399 million.” South Carolina also borrowed $270 million to help build the factory, the daily paper said.
State officials at the time said it was the biggest investment South Carolina had ever made.
In 2013, the legislature approved a 4 percent tax for infrastructure improvements for Boeing to add to its facility and create another 2,000 jobs. Without the incentives, Boeing would have paid 10.5 percent tax rate, according to Aviation Week.
But what made this deal stand out isn’t just its overwhelming success — Boeing’s economic impact is judged to be around $12 billion — the state took another big step and invested in the future. With $45 million, South Carolina agreed to train Boeing’s workforce.
Called Ready SC, the center lives at Trident Technical College, a two-year training ground for tech careers, much like a community college. The state pays for its instructors — certified by Boeing — and for the equipment. Ready SC does all the pre-hiring admin work, first phone calls and offers a round of voluntary training to weed out candidates. Once hired by Boeing, Ready SC spends between 10-14 weeks training the employees.
Ready SC started in the 1960s, but the facility in North Charleston specifically trains Boeing workers — and it’s free, says Howard White, director of the Boeing project.
“We believe in the ‘grow your own’ philosophy,” he said. “So the program can do company-specific curriculum. The company tells us what they need and we design the curriculum. But at Boeing, they said they’d been building airplanes for 100 years, so they gave us the curriculum and trained our instructors. We train their employees now.”
In the early years of the project, instructors trained entry-level workers to be able to work on the manufacturing floor with minimal supervision.
“These days,” White said, “we train people for new jobs, for additional certifications. We do about 9,000 trainings a year.”
The city benefitted from its military presence. About 90 percent of the instructors are former or retired military, White said. They’re drawn from the nearby Air Force base and fit in with the South Carolina model.
“We have 200 different courses we do here,” he said. “And the starting salaries — entry level — were between $14-$18 an hour back in 2009 when they first started.”
At a later tour of the Boeing facility officials said workers were paid on a regional competitive basis. Rival AirBus has a big facility in Alabama, so the company works to keep wages competitive.
“We also now have Volvo coming in,” said Tommy Preston, director of Boeing’s National Strategy and Engagement. “We don’t want our people going to Volvo, so we’ll keep an eye out for what they are paying.”
Boeing’s arrival in Charleston heralded a new age for the city, residents say. It’s made the city more competitive and other manufacturing companies are taking a closer look, it’s created a wealth of indirect jobs and now, suppliers for Boeing’s parts are moving to South Carolina.
“The return on investment was huge,” White said. “The state got together and created the incentives package, but the ROI — that’s around $12 billions — that’s jobs, investments, retail, restaurants.”
The Boeing facility and its trained workforce have since attracted Mercedes-Benz and Volvo manufacturing plants to the city. Volvo’s plant is finished and construction on a training facility is underway. Ready SC will train 2,000 Volvo workers at the site, which is being paid in part by Berkeley County funds and in part by Volvo.
Colorado Springs Business Journal Editor & COO Amy Gillentine Sweet is reporting from the Regional Leaders Trip in Charleston, S.C.