Charlotte: Economy
Major Industries and Commercial Activity
Distribution and banking are the two major forces responsible for the emergence of Charlotte as a major urban center where economic growth and business development are flourishing.
Located in one of the nation's largest urban regions, Charlotte has more than six million people living within a 100-mile radius. In fact, more than half the population of the United States can be reached from Charlotte within one hour's flight time or one day by vehicle. Its proximity to a wide variety of markets has led to Charlotte's maturation as a financial, distribution, and transportation center for the entire urban region. The city has developed into a major wholesale center with the highest per capita sales in the United States, ranking sixth nationally in total wholesale sales.
Charlotte is also becoming recognized as a national and international financial center. The city is already the major banking center of the Southeast and only New York City has more banking resources. With more than $1 trillion in bank holding company assets and two major banking institutions (Wachovia and Bank of America), Charlotte is in a position to provide businesses with a wide array of sophisticated corporate banking services, as well as resources for financing and investing.
Several factors attract foreign businesses to Charlotte from such countries as Germany, Great Britain, Japan, France, Switzerland, Italy, and Canada. These include an inland port facility, a foreign trade zone, and the area's customs and immigration offices. More than 600 foreign-owned companies have facilities in the Charlotte region, representing one-third of all foreign companies in North Carolina and South Carolina combined.
In October 2000, Entrepreneur magazine listed metropolitan Charlotte as fifth on their ranking of the "Top 20 Large Cities" to own a business. As the subsidiary headquarters for a variety of major national companies, its urban region continues to attract sophisticated industries such as microelectronics, metal working, and vehicle assembly, as well as research and development, high-technology and service-oriented international and domestic firms. Charlotte boasted 286 Fortune 500 firms in 2004 within its city limits along with 1,200 manufacturing companies.
In recent years, Charlotte has emerged as a magnet for defense-related industries, with four of the nation's top ten defense contractors locating facilities in the area. In 2003, 149 defense-related firms were awarded contracts totaling more than $47 million; more than $160 million in defense related contracts have been awarded to Charlotte companies in the past three years.
Charlotte's business future is expected to remain diverse. More corporate headquarters, transportation- and distribution-related industries will lead growth, with knowledge-based industries following. In 2005, 48 biotech firms are located in Charlotte and 18 optoelectronic facilities exist within the region.
Items and goods produced: textiles, food products, printing and publishing, machinery, primary and fabricated metals, aircraft parts, computers, paper products
Incentive Programs—New and Existing Companies
A variety of incentives, grants, bonds, and other programs are offered by the City of Charlotte and Mecklenburg County to help local businesses. Among them, two brown-field programs offer reimbursement for site development or tax breaks; a Façade Improvement Grant Program offers reimbursements up to $10,000 for façade renovations, landscaping, or signage improvements; a Business Investment Grant Program offers funds for eligible companies.
State programs
North Carolina, a right-to-work state with a low unionization rate, offers a revenue bond pool program through various banks. Several venture capital funds operate in the state and inquiries can be made through North Carolina's Council for Entrepreneurial Development (CED). Industrial Revenue Bonds issued by the state provide new and expanding businesses the opportunity to provide good employment and wage opportunities for their workers. North Carolina offers State Technology Based Equity Funds providing financing for new technology based enterprises, as well as TDA incubators for firms transferring new technologies into commercial applications. The state offers an income tax allocation formula that permits the double weighting of sales in calculating corporate income tax. The North Carolina Department of Transportation administers a program which provides for the construction of access roads to industrial sites and road improvements in areas surrounding major corporate installations. The William S. Lee Act makes available to new and expanding companies a 4 percent tax credit on machinery and equipment investments over $2 million, a jobs tax credit, worker training tax credit, research and development tax credits, and business property tax credits. The State Development Zones program offers tax credits for investments in machinery or equipment, creation of new jobs, worker training, credit on training expenditures, and research and development.
Job training programs
The state of North Carolina's Division of Employment and Training offers a unique system of job training programs that are available to any new or expanding manufacturing employer creating a minimum of 12 new production jobs in the state, and to any new or prospective employee referred for training by a participating company. The industrial training service provides great versatility in terms of types and length of training, and classes can be held in a company's plant or on the campus of one of the state's community colleges. The state of North Carolina furnishes instructors and, at the company's request, may test and screen job candidates. Employees may go through training before or after employment by the company. The industrial training service is financed solely by the state of North Carolina.
Development Projects
In the 10 years between 1994 and 2003, Charlotte gained 8,888 firms, announced more than $9.1 billion in new business, and created 79,646 new jobs on 99 million square feet of floor space. During that 10-year period, significant announcements were made by a variety of firms, including the Charlotte Bobcats, Carolina Panthers, Carrier Corporation, Carolina Place Mall, GM Onstar, Hearst Corporation, Trans-america, Solectron, SeaLand, T.J. Maxx Distribution Center, and B.F. Goodrich. The Charlotte-Mecklenburg Development Corporation (CMDC) began selling parcels of land in 2003 on the site of the Wilkinson Park Business Center. One investor was the real estate firm Beacon Partners, who in August 2004 planned the $5 million development of 5 free-standing buildings ranging from 12,500 to 22,080 square feet. Johnson & Wales University opened its new campus to about 1,000 students that will also provide exceptional student housing featuring expansive floor plans, a fitness center, and game room.
Today's retail building in Charlotte is being shaped by a court ruling made in 2000. The retail building boom the area witnessed during the 1990s might have gone on indefinitely, but in a far-reaching development neighborhood opponents of a shopping center project took Charlotte and the developer to court and won. In a decision handed down by a Superior Court judge in May 2000, it was ruled that the city must change how it makes about 80 percent of its zoning decisions. The judge said that Charlotte's fast-track zoning process, under which approvals were made without a hearing, was illegal as it violated state laws. The decision impacted at least 50 projects that ranged from multimillion-dollar shopping center expansions to apartment buildings. The SouthPark Mall, at the center of the controversy, was set to grow by 50% and bring in tenants such as Saks Fifth Avenue and Nordstrom, but the ruling resulted in a limitation on square footage that prevented or delayed those retailers from setting up shop.
Prominent among Charlotte's success is the New Charlotte Arena that will serve as home to the NBA expansion Bobcat team along with the WNBA's Charlotte Sting beginning in the fall of 2005. Occupying about 780,000 square feet at a cost of $200 million, it will host college basketball, concerts, and other shows.
Economic Development Information: Charlotte Chamber of Commerce, 330 S. Tryon St., PO Box 32785, Charlotte, NC 28232; telephone (704)378-1300
Commercial Shipping
Providing exceptional air service in and out of the city, Charlotte/Douglas International Airport ranked 33rd nationally in annual air cargo volume in 2004 with nearly 96,000 tons deplaned. Both domestic and international air freight moves quickly and economically to its destination. Charlotte also serves as a major hub for small package express. Ten air couriers have Charlotte operations in addition to commercial passenger carriers and large freight forwarders.
Charlotte is at the center of the largest consolidated rail system in the United States. Two major rail systems, Norfolk Southern and CSX Transportation, link 27,000 miles of rail systems between the region and 23 states in the eastern half of the country. About 300 trains pass through the city each week. The railroads, in fact, have enabled Charlotte to become a "port city," although the city is located about 175 miles from the coast. The Charlotte Intermodal Terminal (CIT), operated by the North Carolina Ports Authority, is a facility that links Charlotte with the port of Wilmington, Delaware, through a Seaboard Railroad System piggyback ramp operation. CIT is the first fully operational inland container staging and storage facility in the United States operated by a port authority.
More than 200 trucking companies move products and materials through the area. Forty percent of the nation's 100 largest trucking firms have Charlotte operations.
Labor Force and Employment Outlook
The work force in both Mecklenburg County and surrounding areas is plentiful. Studies have found North Carolina workers are more productive than other workers in the same industries nationally. Several area educational institutions provide education and training for employees, including classes in technical skills and management development, as well as graduate degree programs. In 2003 alone, new Charlotte firms created 16,171 new jobs.
The following is a summary of data regarding the Charlotte-Gastonia-Rock Hill labor force, 2003 annual averages.
Size of nonagricultural labor force: 823,400
Number of workers employed in . . .
manufacturing: 106,200
trade, transportation, and utilities: 176,500
information: 24,300
financial activities: 69,000
professional and business services: 118,700
educational and health services: 68,200
leisure and hospitality: 71,000
other services: 36,600
government: 104,700
Average hourly earnings of production workers employed in manufacturing: $14.54
Unemployment rate: 5.2% (December 2004)
| Largest employers | Number of employees |
| Wachovia Corporation | 18,967 |
| Carolinas HealthCare System | 15,257 |
| Charlotte-Mecklenburg Schools | 15,134 |
| Bank of America | 13,000 |
| City of Charlotte | 5,838 |
| US Airways | 5,749 |
| Duke Energy Corp. | 5,400 |
| Mecklenburg County | 5,373 |
| Presbyterian Healthcare/Novant Health | 5,166 |
| Excel Staffing Services of Charlotte, Inc. | 4,500 |
Cost of Living
A slightly lower than national average cost of living and broad economic base converge to make Charlotte attractive to new residents.
The following is a summary of data regarding several key cost of living factors for the Charlotte area.
2004 (3rd Quarter) ACCRA Average House Price: $218,000
2004 (3rd Quarter) ACCRA Cost of Living Index: 92.9 (U.S. average = 100.0)
State income tax rate: Ranges from 6.0% to 8.25%
State sales tax rate: 4.5% (food and prescription drugs are exempt; food sales are subject to local sales taxes)
Local income tax rate: None
Local sales tax rate: 3.0% (county-wide) (restaurant food sales are subject to local sales tax of 7.5%; 2.0% in grocery stores for food)
Property tax rate: City, $.42 plus County, $.7567 per $100 assessed value; assessed value based on 100% of established market value (2005)
Economic Information: Charlotte Chamber of Commerce, 330 S. Tryon St., PO Box 32785, Charlotte, NC 28232; telephone (704)378-1300