Tampa, Hillsborough nab higher-profile job deals in quest for economic respect
September 18, 2015
The best word to describe it? Crescendo: an increase in loudness or intensity.
Year after year, Tampa and Hillsborough County have built a rising intensity of corporate job recruitment successes. The crescendo was marked most recently by the latest deal with Fortune 100 company Johnson & Johnson. The drug and consumer products giant chose to come here to open its national back-office operation for finance, HR, IT and corporate procurement functions in one “shared service center.”
That deal involves a commitment of 500 Johnson & Johnson jobs here averaging $75,000 — far above the metro average in the mid $40,000s — within three years. Once that happens, the company becomes eligible for state and local incentives worth $6.4 million.
That’s the sum economic development officials in Florida used to help convince the huge New Jersey company that this metro area was a better place than at least two other out-of-state cities that also waved incentive money at Johnson & Johnson.
The recruiting success exists at several levels.
First, the caliber of new companies is clearly increasing: Johnson & Johnson’s arrival; Bristol-Myers Squibb opening a similar operation here last year; financial giants USAA and Depository Trust Clearing Corp. (DTCC) committing to add more than 1,500 jobs between them; Amazon’s rapid expansion of two Central Florida distribution hubs. These are world-class businesses that are adding their reputations to this market.
Second, more of the new jobs pay higher wages. DTCC’s expansion in 2013 of 284 jobs to its sophisticated securities clearing service center just off I-75 comes with an average $100,000 wage. Many others are adding jobs with wages of $50,000 to $75,000 or more.
Third, more of these recruited companies are either building their own facilities or taking vacant high-end office space and remodeling it to their needs.
Fourth, the amount of capital investment that accompanies these recruitment deals is rising fast. In 2004, before the recession, Tampa/Hillsborough announced just 10 deals for a total of 749 jobs and less than $40 million in capital investment. In 2014, the latest complete year for data, 31 deals were announced with a total of 4,532 jobs and $614 million in capital investment.
The point is not simply to praise the successes of Tampa/Hillsborough’s record of job recruiting. Other counties and cities in this metro area have had their successes, too. But clearly, Tampa/Hillsborough is cementing its role as this region’s primary business engine, which will only benefit the wider Tampa Bay market with added buying power from more jobs, higher-wage skills and the increasing ripple effect from more sophisticated companies.
This is not Tampa Bay’s first economic crescendo. They seem to come in cycles. A key one that took place in the 1980s to early 2000s with the arrival of the back-office operations of financial services companies. It grew so focused here that Tampa Bay briefly pitched itself as Wall Street South. But the result has been the long-term establishment of major banking and insurance companies here, most notably JPMorgan Chase, Citigroup, USAA, MetLife and many others. DTCC, based in Manhattan, picked Hillsborough as a refuge for its critical processing center in the wake of the Sept. 11, 2001, terrorist attacks on New York’s World Trade Center towers.
Many of these major financial firms continue to expand here. Citigroup, which has picked its Tampa location as a major anti-money-laundering hub, continues to grow at a rapid clip. And USAA’s job expansion of more than 1,200 jobs here, announced last year, ranks among the largest job gains by any employer in recent times.
So where might 2015’s crescendo take Tampa Bay?
It could help set the table for a significant corporation, perhaps a Fortune 500 company with a household name, to decide to bring its headquarters to this market. Tampa Bay is home to a handful of Fortune 500 companies but is generally perceived as thin on HQs compared to such rival metro areas as Atlanta, Charlotte, N.C., Cincinnati, Pittsburgh or Dallas.
That’s why a trio of economic leaders from here will be heading to New York and New Jersey at the end of September. Tampa Bay Lightning owner and real estate developer Jeff Vinik, Tampa Hillsborough Economic Development Corp. CEO Rick Homans and former Enterprise Florida chief and now private consultant Gray Swoope intend to call on a number of executives at the headquarters of larger companies that have some ties or familiarity with this market.
Homans says the recent arrivals in Tampa of global companies like New York-based Bristol-Myers Squibb and New Jersey-based Johnson & Johnson may prove formidable selling points. Companies like, uh, company — meaning corporations are much more likely to relocate to areas already occupied by other substantial businesses they know.
“Operations like these,” says Homans, pointing to the two companies’ operations here, “are about as close as you can get to a corporate headquarters — without the corporate headquarters.
“This is a big endorsement at a really good time.”
The recent PR campaigns by Vinik — who wants a corporate headquarters of note to occupy part of his 40-acre development under way near Amalie Arena south of downtown Tampa — also can’t be overestimated for spreading the good word about the Tampa area’s potential. Vinik has appeared, often more than once, on CNBC, Bloomberg TV and other national media outlets watched by senior business executives. Vinik enthusiastically touts Tampa’s downtown and the overall market as an undiscovered and affordable diamond in the rough.
Vinik commands instant respect to that kind of audience. His past Wall Street investing career is well known to many. And the recent success of his NHL Lightning team in reaching the Stanley Cup final (despite losing to Chicago) only deepens his clout with a business class that responds to people who are true competitors.
Don’t expect instant success. But appreciate Tampa Bay’s crescendo of economic gains.
Robert Trigaux, Times Business Columnist