Four ways to encourage manufacturing expansion
Harting announced a $6 million expansion in its existing Elgin, Ill., facility, with an Oct. 26 ribbon cutting involving company, state, local officials, and others. Cooperation to facilitate faster start-up of new lines helped in addition to more than $1.5 million in incentives offered.
Harting’s latest investment is expected to add 50 or more jobs to 112 already employed at the Illinois site, along with a lab, showroom, and expanded injection molding and die-casting processes for the connector and industrial communications manufacturer. The manufacturing expansion is targeted for completion in January 2019 and other work to be finished by October 2019.
Manufacturers bring value to local and state governments such as:
- High-paying jobs with good benefits
- Developing clean, high-technology facilities that support other area jobs and suppliers
- Adding to the tax base
- Adding critical mass to an area’s posterity and talent pool.
In return, manufacturers try to negotiate a positive set of incentives for locating or expanding in an area.
Harting, a family-owned company founded in 1945, manufactures products for the connector industry for use in mechanical and plant engineering, broadcast and entertainment, factory automation, power generation and distribution, and industrial electronics and telecommunications.
Harting North America president and CEO, Jon DeSouza, praised the workforce and strategic location, saying the company was looking to “build upon our current successes within the North American market.”
1. State incentives
Illinois Gov. Bruce Rauner said the state has worked with Harting on expansion details since early 2018.
Incentives: Illinois Department of Commerce and Economic Opportunity has Edge incentive agreements to encourage relocation and expansion in the state. State tax credits of $1,534,645 are tied to creation of 50 jobs and retention of 112 (or about 150, including sales and other support positions, Harting said). A 28-page Oct. 26 State of Illinois Edge document said Harting had also considered Charlotte, N.C., and Mexico City, Mexico, for the expansion.
Visits: Rauner visited Harting facilities in Espelkamp, Germany, in April and saw the company at Hannover Fair and visited IMTS 2018 in Chicago in September. At the Oct. 26 event, Rauner greeted company representatives by name upon entering the building. Intersect Illinois, the state’s jobs agency, coordinated the April trade mission to Germany and Poland to enhance the state’s Foreign Direct Investment (FDI) strategy. Delegation members included Mark Peterson, Intersect Illinois CEO; Sean McCarthy, former state Department of Commerce director; Greg Baise, Illinois Manufacturing Association (IMA) president and Mark Denzler, IMA vice president; Kenneth Ender, Harper College president, and Mark Tomkins, president and CEO of the German American Chamber of Commerce of the Midwest.
2. Local incentives
Streamlined permitting: To help speed manufacturing startups and expansions, Mayor Kaptain told CFE Media that Elgin helps business expansion by expediting permitting and inspections and ensuring the right people are available to help avoid startup delays and related manufacturing revenue.
Educational partnerships: The city also works with area schools to improve job skills through the use of certification programs and the “National Career Readiness Certificate.”
3. Educational institutions
Community colleges offer manufacturing technology course work, related certifications, and workforce development programs. They encourage students to consider available jobs at expanding manufacturing locations, like Harting. Elgin Community College includes studies in computer integrated manufacturing, energy management, and machine tool operations; and nearby Harper College includes electronics engineering technology, maintenance technology, and manufacturing technology.
4. Area and national chambers of commerce
Encouragement and networking connections about area benefits, business development resources, and programs are offered by chambers of commerce, such as the German American Chamber of Commerce of the Midwest and Elgin Area Chamber of Commerce.
While it may seem obvious, being helpful, polite, gracious, welcoming, and thankful is useful. Those at the Harting expansion event displayed all of these traits and seemed grateful for the help and courtesy of those involved.
KEYWORDS: Manufacturing expansion, industrial networks, business development
- Manufacturing growth incentives can include tax breaks, workforce, education, and expedited permitting.
- Harting expands in Elgin, Ill., expecting to add 50 jobs.
- A $6 million investment is rewarded with $1.53 million in tax incentives.
How are you collaborating with and educating area officials in advance of your next manufacturing expansion?