By Mike Walden
North Carolina’s economy has been a powerhouse of growth in recent decades. The state has been recognized by several organizations as one of the top places for economic development. North Carolina has a track record of luring top firms, especially in industries that are leading in both the national and international economies.
But there is a downside to North Carolina’s track record on economic development: The state’s big metropolitan areas have taken most of the glory of big business startups. Many of the state’s small cities and towns and rural areas have been largely left behind on luring firms, especially in the headline-grabbing industries.
As part of research I am doing for a new book, I looked at all the new business announcements occurring in North Carolina since the pandemic, meaning from 2021 to 2024. I was pleasantly surprised by what the information indicated.
First, a tremendous amount of new business announcements have been made, suggesting North Carolina continues its ability to attract new firms in the post-pandemic economy. Collectively from 2021 to 2024 North Carolina attracted almost $42 billion of capital investments, meaning money to be spent on new facilities like factories, machinery and office buildings. Several of the individual investments were for over a billion dollars, with a few being for multi-billions of dollars. When operational, the new companies will add 73,000 jobs. If impacts on suppliers and spending from additional payroll are included, the total job impact will be well over 100,000 jobs.
I did a deeper dive into where the largest companies — defined as those with over $100 million of capital investment — were locating in the state. Here’s where I had the pleasant surprise. Certainly the traditional locations in the Triangle, Charlotte and the Triad continued, but I found the announcements have also been spreading to other locations. Johnston County received almost $3 billion in capital investments from large pharmaceutical companies. Although Johnston County is considered part of the Triangle region, it is on the fringe of the area. But with the I-540 outer loop almost complete, the county has the benefit of both access and lower-cost land.
The Rocky Mount-Wilson-Greenville area in eastern North Carolina received big announcements from technology firms, including for battery and semiconductor production, as well as from large pharmaceutical firms, with a total of over $5 billion in capital investments. This is significant because for decades the region has been challenged in moving from an economy led by tobacco to the new economy of the 21st century. The Hickory region also added to its existing technology base, and the state’s southernmost county — Brunswick County — landed a battery factory worth over half a billion dollars. Access to the Port of Wilmington and the presence of reliable power from the local nuclear power plant apparently were major positive factors for Brunswick County.
Other rural counties received major announcements from different industries. A $200 million sawmill plant will open in Halifax County, and a $100 million factory manufacturing shingles will be located in Granville County.
If North Carolina’s goal is to spread economic development throughout the state, then what strategies can be used to accomplish this? There are two strategies. One that has been used is megasites. The second is a newer strategy called corridor development.
Megasites are large tracts of land that have been assembled and provided with the necessary utilities, like power, water, access points and other infrastructure. The idea is if a firm interested in locating in North Carolina knows a suitable site is ready for them, then they will be more likely to make the move. For example, a megasite was used to attract the Toyota battery factory in the Triad. The risk of megasites is that if no firm comes, then the spending on the infrastructure is a loss.
The idea of corridor development is to link regions with high-speed transportation and expect the access to stimulate economic development both along the transit route and at both ends of the routes.
Initially corridor development was implemented using rail transit, but now highways are also used. There are three good examples in North Carolina. U.S. Route 64 west of Raleigh and through Chatham and other counties to the Triad region was upgraded several years ago. It is now along this corridor that what some call North Carolina’s renewable energy manufacturing sector is being developed. Already the EV auto manufacturer VinFast, the chip maker Wolfspeed and the Toyota battery factory are being developed, with the expectation that many more supplier companies will also establish facilities.
On the eastern side of the state the same U.S. 64 is being upgraded to interstate status from Raleigh to Rocky Mount. This has likely been a factor behind numerous tech and pharmaceutical companies announcing investments in the region. Also, in Downeast North Carolina, another corridor development is proceeding with the upgrading of U.S. 70 from Raleigh to Morehead City to interstate status. It is exciting to think about the economic development this project could bring to the region.
Many have been anxious — including yours truly — about what the post-pandemic economy will look like in North Carolina. While everything is certainly not perfect, it appears that distributing more economic growth throughout North Carolina has been a positive outcome in the years since 2020. Is this exactly the economic elixir the state has needed? You decide.
Mike Walden is a William Neal Reynolds Distinguished Professor Emeritus at North Carolina State University.
