MANATEE -- Florida can lead the nation in the aircraft manufacturing industry if it continues to encourage businesses to relocate to the Sunshine State and addresses a labor shortage through education, a Florida taxpayer watchdog group says.
Florida TaxWatch released a report Thursday, "Ready For Takeoff: Florida Can Lead The Nation In Aircraft Manufacturing," which says the state's favorable tax climate is a boon for the commercial aviation manufacturing industry. Florida ranks only behind California for the number of aircraft manufacturing and parts plants/offices with 249; California has 483.
Over the last decade, the number of aircraft manufacturing facilities in Florida increased by about 60 percent, according to the report.
"Florida is a great place to do business, and the state's commitment to investing in aircraft manufacturing is ensuring that Florida's econo
Never miss a local story.
my continues to benefit from this important industry sector," said Dominic M. Calabro, president and CEO of Florida TaxWatch, a nonpartisan taxpayer watchdog group.
Jobs have not followed the growth in Florida facilities. Florida did not rank in the top 10 for states with the highest rate of aerospace jobs added from 2007 to 2012, according to a study by Avalanche Consulting.
Incentives appear to be working for the industry as most companies are staying here. Enterprise Florida provided more than 30 incentives to aircraft and parts companies through its Qualified Target Industries program, and 19 companies are still active, according to the Florida TaxWatch report.
"Florida's Legislature and Enterprise Florida have worked diligently to create a favorable climate for all businesses to be successful, including those in the aircraft manufacturing sector," said Robert E. Weissert, chief research officer for Florida TaxWatch. "To ensure the future growth and success of this industry in Florida, policymakers should continue to provide a competitive environment for aircraft manufacturers."
The group also looked at the ease of location, and noted while Florida has attractive incentives and grants to defray moving costs, a PricewaterhouseCoopers study showed Utah, Wyoming, Montana and Missouri all are less expensive for aircraft manufacturing companies than Florida.
In 2013, those 249 companies accounted for 12,519 employees in the state with average wages at $72,010 for aircraft manufacturing. Aircraft engine parts jobs average $81,091, while other aircraft parts jobs average $57,120.
The impact could be even greater than the report details. Florida TaxWatch analyzed companies classified by the Department of Economic Opportunity based on the aerospace manufacturing classification. Companies such as Radiant Power Corp. in Tallevast also make components for aircrafts, but its products overlap with marine uses. DEO classifies Radiant as being in the search/detection, aeronautical industry.
Manatee is home to several companies that manufacture and supply components for the aerospace manufacturing industry, said Sharon Hillstrom, president and chief executive officer of the Bradenton Area Economic Development Corp.
Other companies include Honeycomb, Honeywell, Trinity Manufacturing, which makes electrical components, and Hobart Ground Systems, which makes ground support systems for airports and for the military.
"It brings a certain amount of prestige to the area having companies here that attract a certain level of talent," Hillstrom said.
Radiant makes instruments, sensors and emergency power supplies for aircraft, including the so-called black box recording devices. The company's growth was aided by incentives from the state and county.
Get the word out
Radiant President Anish Patel said doing business in Florida and continuing to fold sister companies into its Tallevast operations shows there is a "growing, technically oriented workforce" in the area and state.
The state could do more to make it better known as a growing technology hub for job candidates and companies, he said.
"They don't see yet that there's a lot of opportunities, not just in one or two companies, but several if they wish to advance their careers throughout Florida," Patel said. Instead, the state is still considered a tourism and retirement spot.
While aerospace manufacturing is primarily an export industry, the number of related companies in Florida helps Radiant.
"We have several customers in state. It definitely helps to be able to have that close proximity," Patel said. "You can provide same-day service for shipping and for emergency situations you can provide a quick turnaround. Having that community of other manufacturers is a strength that helps us market within the state."
Radiant, a subsidiary of Heico Corp., came to south Manatee in 1999 and announced last year it will add 16 jobs to its 72-person workforce thanks to the same QTI incentive the taxpayer watch group touted. The company relocated some of its operations from Hatsfield, Pa., and St. Charles, Ill., while adding 4,000 square feet to its 27,000-square-foot plant. In March, the company completed the transition of undertaking sister company Dukane-Seacom. Today, Radiant has 96 employees, Patel said.
Radiant will receive an $80,000 tax refund if it meets its job and other contractual requirements, according to the governor's office announcement from 2013. The Manatee County commissioners also gave the company a $16,000 match in 2013 in addition to $26,000 in 2012 for a previous expansion and addition of 26 jobs.
The money helped provide job training and recruiting along with relocation expenses, Patel said.
"Any of those type of incentive packages are definitely a plus when you're looking at the total cost of moving a business," he said.
Manatee County is home to companies similar to Radiant, including Safran Labinal Power Systems in Tallevast. The Parisian company maintains a 135,000-square-foot industrial building in Whitfield, after buying out a division of Eaton that operated there. The company last reported it had 180 employees that make illuminated switches, cock pit panel assemblies and other power distribution components.
More work needed
If the state wants to continue to replenish the job force, it needs to invest more in science, technology, engineering and math education, or STEM, according to the study, because there is a skilled labor shortage in the state for the industry.
"Expanding the aircraft manufacturing industry helps the state retain STEM talent," said Jennifer Linares, TaxWatch Research Analyst.
"However, the shortage of qualified technical employees could be an impediment to the industry's future growth in Florida."
A robust workforce training grant program is one tool to help companies bridge the gap in the meantime, Hillstrom said.
Patel said education and the labor shortage is "an ongoing challenge," but it's better than what it was.
"The environment is better, but it is still an ongoing challenge to find competent engineers, competent technicians to help us grow," he said.
Charles Schelle, Herald business reporter, can be reached at 941-745-7095. Follow him on Twitter @ImYourChuck.