Says continued economic development will absorb growing workforce.
Northeast Florida is experiencing a “golden time,” according to JAXUSA Partnership President Jerry Mallot.
At Friday’s Northeast Florida Builders Association Sales and Marketing Council Breakfast at the University of North Florida, Mallot said the Jacksonville region’s low unemployment rate combined with its ability to attract new industry and healthy real estate market have created a perfect storm of economic vitality.
“Unemployment is below 4 percent, which means we are at full employment,” Mallot said. “We have relatively low taxes, an unbelievable amount of things to do and the support of our government, so it is a good place to live and do business.”
In addition to serving as executive vice president of the JAX Chamber, Mallot oversees the strategy for economic development in the region and focuses on expansion and relocation of corporate headquarters.
“We scour the world for opportunities for companies that are going to put projects somewhere in the U.S. and we try to win them for our region along the way,” Mallot said.
Examples he cited included automakers BMW and Mercedes-Benz, which both are expanding their presence here, as is Anheuser-Busch, which built a $175 million plant to manufacture aluminum bottles.
“Earlier this year, a company from New York, Formativ Health, picked us for a 500-person office to serve as the front and back office for hospitals in New York City,” Mallot said. “They are already up to 150 to 200 employees and will probably be at the 500 mark next year.”
And no Jacksonville economic development briefing would be complete without mentioning Amazon, which is hiring 5,000 area workers.
“We spent a lot of time working with Amazon over the last few years to take a look at us,” Mallot said. “We were certain they would end up in Georgia and not here, but we were successful in interesting them and bringing them here.”
Mallot did not mention the city’s bid to lure Amazon’s second North American corporate headquarters.
With Amazon came about 1,000 positions paying between $50,000 and $100,000 year, Mallot said, but the vast majority of the jobs pay between $12 and $15 per hour. Those wages, he added, will impact other businesses seeking quality workers.
“Some of you may think ‘this is going to touch my business,’ and it probably will,” Mallot told the homebuilders.
“You will have competition, but then we will also have an unemployment rate of 3.4 percent, and that means everybody with a college degree will have a job and most with a high school diploma will have a job, but the need will remain in that lower-wage area,” he said.
Mallot said new entertainment facilities such as Daily’s Place and Topgolf help attract corporate interest, as does the weather, the river, beaches and the addition of new shopping and restaurants at developments such as St. Johns Town Center.
Downtown projects, such as The District planned for the Southbank, also enhance the region’s appeal.
“And The Shipyards I know is going to happen,” Mallot said, referencing the recent JAX Chamber-sponsored trip to Toronto to learn about how that city capitalized on its waterfront.
While there, the group stayed at the Four Seasons Hotel Toronto owned by Jacksonville Jaguars owner Shad Khan.
“It’s no secret that Shad intends to build a Four Seasons in Downtown Jacksonville. Two weeks ago work began on the Barnett Bank building that we’ve been working on it seems like a decade, and sometime next year the Laura Street Trio Downtown will be underway.”
Mallot added that vertical construction has begun at Durbin Park in St. Johns County at Florida 9B and Race Track Road, a development characterized as another St. Johns Town Center, only larger.
“We are at a real important period,” Mallot said. “We always worry. I’m hearing more and more economists say we never really fully got out of the last recession and we may have three or four years before we have to have another one, and that’s got to be music to your ears. We may be able to extend this period of expansion and growth a lot longer than we have done before.”
Continued tightening of economic incentives by the Florida Legislature, Mallot warned, places the state and region at a disadvantage when recruiting major expansions and relocations. Still, he expects the region to continue to grow and add jobs.
“We are in great shape, and we will continue to be successful because this is one of the most attractive places to live in the country,” he said.
Mallot was asked how a market of such low unemployment can staff the new major companies and whether that statistic hinders the efforts of JAXUSA. Continued migration to the area, he replied, easily absorbs new employment opportunities.
“If we were at full employment today, and stopped development, our unemployment would go up because of people moving into the area,” he said.
The military presence, he added, contributes to the growth of civilian workforce as approximately 80 percent of them remain here after they retire.
“Vibrancy prompts growth,” Mallot said. “That next recession will come and we want to be in great shape for it.”