UNC Center for Competitive Economies (C 3 E) Chatham County: Economic Development Strategic Plan Jason Jolley, Senior Research Director Adjunct Assistant

UNC Center for Competitive Economies (C3E)

Chatham County:

Economic Development Strategic Plan

Jason Jolley, Jason Jolley,

Senior Research DirectorSenior Research Director

Adjunct Assistant ProfessorAdjunct Assistant Professor

The Carolina Center for Competitive Economies (C3E) Kenan Institute for Private Enterprise

Project Background

Three incoming Chatham County commissioners approached C3E to gain a better understanding of the local economy.

A part of our public service mission, C3E conducted four workshops with incoming commissioners and community leaders, concluding with a SWOT analysis.

On April 1, 2007 the Chatham County Board of Commissioner contracted with the UNC Center for Competitive Economies to create an economic development strategic plan for Chatham County.

The Chatham County Economic Development Corporation was charged with facilitating the planning effort.

1. Task One: Community Engagement

2. Task Two: Economic Development Scan

3. Task Three: Comprehensive Workforce Inventory

4. Task Four: Targeted Industry Cluster Characterization

5. Task Five: Existing Industry Needs/Opportunities Assessment

6. Task Six: Comparable Communities Assessment

7. Task Seven: Economic Development Vision Plan

8. Task Eight: Economic Development Organization Optimization

Our Objectives: To construct a community supported economic

development plan. To redefine Chatham’s competitive position within

the RTP/Triad regions To identify existing industry/business needs and

opportunities. To accurately inventory Chatham’s labor force. To refocus industrial development on high value

companies paying higher wages


Economic Development Deliverables

Expansion prospects from among existing Chatham County companies;

RTP area growth companies targeted for location of production activities and company-level descriptions of the Piedmont Triad and RTRP industry clusters most appropriate for Chatham County;

Specific company prospects outside of North Carolina for targeting;

Market-articulated infrastructure needs and priorities list; Entrepreneurial economy assessment; Workforce asset inventory; and Recommendation of strategic economic development

organization and management restructuring.


Community EngagementBlending the diverse community

preferences of Chatham County citizens with an objective assessment of the

County’s economic development options

Community Engagement

Blending economic analysis with community values: Five community meetings were held to kick-start

the planning effort. Two-day economic summit was held at the

planning mid-point. Five person working group of the EDC Board. 20 person Economic Development Strategic

Planning Task Force. Two final community meetings to present plan Presentation to joint meeting of County, Towns,

and EDC Boards.

Community Engagement

Over 1600 volunteer hours from the citizens of Chatham County formed the backbone of this project and provided community oriented context to our research in developing this strategic plan.

Chatham County’s Challenges

Chatham County… is becoming a bedroom community of the Triangle region and

residents commute outside the county to work. jobs are concentrated in low skilled, low wage industries. is experiencing a growing wage gap between the wages of

Chatham County jobs and the NC average. leaks a large percentage of its retail sales and sales tax to

neighboring counties. has geographic, cultural, and economic divide between eastern

(Pittsboro) and western (Siler City) Chatham.

The County’s historic ad hoc economic development and planning approaches were insufficient to address these challenges.

Weekly Wage 2006 1st Quarter

$556$627

$722$683

$767

$557

$830$744

$1,136

$0.00

$200.00

$400.00

$600.00

$800.00

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$1,200.00

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Chatham/NC Wage Variance

-$60,000

-$40,000

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Chatham’s Low Wage Structure

65.0%

70.0%

75.0%

80.0%

85.0%

90.0%

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

% of NC AWW % of US AWW

Chatham wages as a percentage of US and NC average

Percent of Workers Commuting Outside of County of Residence 2000

55.3%

25.1% 25.1%

12.2%

42.4% 41.3%

19.5%

26.4%28.4%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

Chatham Alamance Durham Guilford Lee Orange Randolph Wake NorthCarolina


Census Tract # Census Tract Name Description

Commute level Destination

202 N Central Chatham Small town low small urban cluster

206 S Central Chatham micropolitan area low

large urban cluster

204 Siler metro Small town internal small urban cluster

203 Siler rural Small town high small urban cluster

205 SW Chatham/Bear Creek Small town high

small urban cluster

207 E Chatham metropolitan area high urban area

201 NE Chatham metropolitan area high urban area

208 Pittsboro metropolitan area high urban area

Source: US Dept. of Agriculture, Economic Research Service

In County JobsJobs of Residents (located

anywhere)Labor

Difference

Agriculture 431 676 245

Mining 52 13 (39)

Utilities 3 118 115

Construction 1,016 2,930 1,914

Manufacturing 5,367 5,291 (76)

Wholesale trade 454 741 287

Retail trade 1,893 2,965 1,072

Transportation 323 729 406

Information 62 615 553

Finance 200 1,010 810

Real estate 73 435 362

Science/Tech 541 2,050 1,509

Administration 487 721 234

Education 1,479 4,059 2,580

Health care 2,247 4,670 2,423

Arts 287 375 88

Hospitality 929 1,529 600

Misc. Services 389 1,409 1,020

Public Admin 809 1,038 229

Retail Sales Leakage(2004-2005 in millions)

Chatham TotalCaptured in County

Leaked Outside County

Leakage Rate

TOTAL $1,236 $448 $788 64%

Apparel $29 $2 $27 92%

Automotive $146 $74 $72 49%

Food $222 $134 $88 40%

Furniture $44 $28 $16 36%

General merchandise $292 $110 $182 62%

Lumber and building material $131 $44 $86 66%

Unclassified $329 $41 $287 87%

Retail Sales

Approximately 64 cents of every retail dollar spent by Chatham County residents is spent outside the county.

Results in about $7.7 million in lost local sales tax revenue.


Organization of Recommendations

1. Economic Development Focus Areas Attraction, Retention, Entrepreneurship

2. Quality of Place 3. Infrastructure4. Economic Development Reorganization

Attraction Retention

Entrepreneurship

1) Economic Development Focus Areas

Focus areas are not mutually exclusive

Attraction 21 potential clusters ED Strategy Task

Force preferences for growth potential, wages, & employment prospects narrowed list to six targeted clusters

Seventh cluster, renewable energy, emerged from citizen preferences.

1. Architectural and engineering services

2. Technical and research services

3. Basic health services

4. Pharmaceuticals

5. Information services

6. Higher education and hospitals

7. Renewable energy

NC Renewables

Pharma

Inf ormation Serv

Higher Ed & Hospitals

Architect & Eng.

Tech & Research

Basic Health

Cities

Highway s

Counties

Lakes, Major Riv ers

City Limits

States

Scale Legend

Mile(s)

0 5 10

1

64

1

117

15

301

401

421

421

64

70

70

701

NASHNASHNASHNASHNASHNASHNASHNASHNASH

Scale Legend

Mile(s)

0 5 10

Triangle: Attraction Clusters

NC Renewables

Pharma

Inf ormation Serv


Architect & Eng.

Tech & Research

Basic Health

Cities

Highway s

Counties


City Limits

States

Scale Legend

Mile(s)

0 5 10

158

158

311

311

421

421

501

60164

64

64

70

DAVIEDAVIEDAVIEDAVIEDAVIEDAVIEDAVIEDAVIEDAVIE

YADKINYADKINYADKINYADKINYADKINYADKINYADKINYADKINYADKIN

SURRYSURRYSURRYSURRYSURRYSURRYSURRYSURRYSURRY STOKESSTOKESSTOKESSTOKESSTOKESSTOKESSTOKESSTOKESSTOKES CASWELLCASWELLCASWELLCASWELLCASWELLCASWELLCASWELLCASWELLCASWELL

Scale Legend

Mile(s)

0 5 10

Triad: Attraction Clusters

NC Renewables

Pharma

Inf ormation Serv


Architect & Eng.

Tech & Research

Basic Health

Cities

Major Roads

Counties


City Limits

States

Scale Legend

Mile(s)

0 3 6

15421

6464

64

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

Old Us 1 Hwy

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lank

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lank

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Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Silk Hope Rd

Pike RdPike RdPike RdPike RdPike RdPike RdPike RdPike RdPike Rd

Oakley Church RdOakley Church RdOakley Church RdOakley Church RdOakley Church RdOakley Church RdOakley Church RdOakley Church RdOakley Church Rd

Manns Chapel RdManns Chapel RdManns Chapel RdManns Chapel RdManns Chapel RdManns Chapel RdManns Chapel RdManns Chapel RdManns Chapel Rd

Lower R

iver Rd

Lower R

iver Rd

Lower R

iver Rd

Lower R

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Lower R

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Lower R

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Lower R

iver Rd

Lower R

iver Rd

Lower R

iver Rd

1301

22

42

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55751

87

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902

902

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HARNETTHARNETTHARNETTHARNETTHARNETTHARNETTHARNETTHARNETTHARNETT

CHATHAMCHATHAMCHATHAMCHATHAMCHATHAMCHATHAMCHATHAMCHATHAMCHATHAM

Scale Legend

Mile(s)

0 3 6

Chatham: Attraction Clusters

Targeted “Growth Companies”Many of the firms in these targeted clusters that favor Chatham are

younger, locally-based “growth companies”Single locations and small headquarters not subsidiaries/branch plants but independently owned,

entrepreneurial firms.Smaller but growing modest scale, between 25 to 50 employees, in facilities from

25,000 to 40,000 square feetHigher value added firms poised for expansion, posting high revenues per employee

ratios, particularly given their modest facility scale

Production Location for RTP/Triad Companies

Chatham County is not receiving its share of RTP/Triad relocations.

Chatham County’s manufacturing heritage and strong community college training programs make it an ideal location for production facilities.

Chatham offers a competitive advantage in cost and labor relative to other “non-core” RTP counties.

Actively market the County’s Central Carolina Business Campus in Siler City and other suitable properties for location of production facilities identified in the targeted industry cluster analysis.

Mid-tech Research Park Prior Center studies demonstrated the potential for a mid-tech

research park in the southern RTP region. Chatham was among the counties identified in this study.

A multi-county collaborative agreement is in place for the Northern RTP region (Kerr-Tar Hub).

Such companies may desire a closer proximity to the RTP market than the Central Carolina Business Campus in Siler City can provide. Northeast Chatham has the existing workforce to support such a park.

Explore the development of an RTP branded mid-tech park to attract footloose, mid-tech companies desiring location in the RTP region.

Vision for the Future

Chatham County’s strategic location between the Triad and Research Triangle regions positions it as the preferred location for emerging-growth companies.

How to you get there?

Move away from ad hoc economic development and planning. Adopt a policy-driven approach to addressing these problems.

Recast the EDC as a credible, apolitical advocate for and facilitator of economic development.

Adopt and implement the economic development strategic plan.

Benefits of University Engagement

C3E Research TeamBrent Lane, Principal Investigator

Jason Jolley, Co-Principal InvestigatorLukas Brun, Senior Research Associate/MPA Student

Research Team:

Sara Abdoulayi, Planning/MBACaroline Cunningham, Planning

LeRae Davis, PlanningLindsey Davis, MPAAllan Freyer, OEBD

Alison Gillette, PlanningErin Gray, Undergraduate

Mari Howe, PlanningWill Lambe, SOG

Nora Lenahan, Planning Ben Mauk, OEBD

Tina Prevatte, Planning/MBAEugene Watkins, MBAJared Wiener, Planning


Academic & Professional Outcomes

Master’s Projects: Lukas Brun (Public Administration ’09): “Including Stakeholders

Preferences in Cluster Analysis” LeRae Davis (Planning ‘08): "Beyond Fiscal Impact: Economic

Benefits of Residential Development" Mari's Howe (Planning ‘08): "A High Road Community Economic

Development Strategy for Rural Communities: A Case Study of Sustainable Agriculture in Chatham County, North Carolina“

Research Papers in Progress: “Economic Development Planning in Bedroom Communities”

(revise and resubmit), Popular Government. “Incorporating Community Values into Industry Cluster Analysis” (in

progress) “Defining a Renewable Energy Cluster” (in progress)

Career Opportunities: Mari Howe (DCRP ’08) hired as new Research and Innovation

Manager for Chatham County Economic Development Corporation


Documents

UNC Center for Competitive Economies (C 3 E) Chatham County: Economic Development Strategic Plan Jason Jolley, Senior Research Director Adjunct Assistant