South Carolina’s performance in the first round of the fDi National Championship ranking sent it soaring to the top of the table in fDi’s south-east conference, before clinching victory as the overall National Champion in the second round. The state received the highest number of projects (and expansion projects) on a per-capita basis of all four finalists, according to data from greenfield investment monitor fDi Markets. Nearly half of all investments in South Carolina between September 2015 and August 2016 were in manufacturing, which has historically been the most important activity in the state.
According to fDi Benchmark, South Carolina has the highest proportion of employment in industrial manufacturing of all of the final four states, and the state’s skilled workforce was cited as a key driver in the investment decisions of several companies, including polyethylene film manufacturer Poly-America, laminate flooring manufacturer Kronotex USA and Akebono Brake Corporation, all of which invested in manufacturing operations in the state in the 12 months to August 2016. Although manufacturing operations remain the biggest industry for foreign investors in the state, business services have been developing in South Carolina and are gaining traction in FDI market share.
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Lights go on in Massachusetts
Massachusetts, nestled on the New England coast, was runner-up in this year’s National Championship, receiving the second highest number of FDI projects per 100,000 people (0.94) of all finalists. The majority of the state’s investments are in more sophisticated and developed sectors such as software and IT services (29%), biotechnology (20.3%), business services (10.1%) and financial services (8.7%). The state has a reputation for innovation and is home to Massachusetts Institute of Technology and Harvard University, which hold first and third place on the QS Top 500 Universities ranking. Canada-based Lumenpulse, which provides LED light solutions, invested in Massachusetts due to its culture of technology and innovation, and the wealth of talent on offer to investors.
California, which came fourth in last year’s competition, has climbed to third position. Sixty projects in the 12-month period to August 2016 were in the software and IT sector, which equated to about one-quarter of all FDI in the state and is testament to its reputation as a tech hub. The highest number of foreign investments came from UK companies: 39 in the time period analysed. As China becomes a more dominant economic force globally, and as the pound suffers as a result of June 2016’s vote to leave the EU, the composition of investors in the state could change in the coming years if investing in the US becomes more expensive for UK-based companies.
In the mid-north corner of the US, Michigan ranked fourth in this year’s championship. The state has traditionally been an industry-based FDI location, particularly in the automotive sector: the ‘Motor City’ Detroit lies within its borders. In July 2016, Canada-based automotive interior supplier Mitchell Plastics committed to a $20.5m factory in the state, thanks to a performance-related grant from the Michigan Strategic Fund, an economic development body which helps to fund key investments for promoting growth.
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