Companies expanding in Ohio promised in 2015 to create a record number of about 23,600 new jobs in the coming years, the statewide private economic development agency JobsOhio announced Tuesday.
Businesses that receive state tax credits or reach grant or loan agreements with JobsOhio make promises for adding jobs and spending capital in exchange for the financial incentives.
Commitments for new job creation grew 10 percent last year from the year before. Also, planned investments in building facilities and equipment reached a record high $6.7 billion in 2015 since JobsOhio was formed in 2011, according to the nonprofit, which released its annual report Tuesday.
These figures stem from a total of 330 business projects that worked with JobsOhio or one of its six regional partners to secure funding from state or local governments or from JobsOhio’s coffers. JobsOhio regional partners include Dayton Development Coalition and REDI Cincinnati.
For example, Fuyao Glass America Inc. first announced plans in 2014 to open an auto glass factory at the former General Motors assembly plant in Moraine. After Fuyao’s initial announcement, the Chinese-based company at the beginning of 2015 announced it will nearly double the amount of jobs originally promised and hire 1,550 workers and invest a total of $360 million.
Additionally, biohealth company Assurex Health announced plans last year to build a new headquarters office in Mason, promising to create at least 150 new jobs over the next three years, according to REDI Cincinnati. Assurex Health provides genetic tests and analysis to help guide doctors’ treatment decisions.
Here are three key reasons that at least companies working with JobsOhio (which is not inclusive of all new or expanding business deals in the state) are upping their plans for hiring and spending:
1. JobsOhio is growing. While the private nonprofit was created in 2011, it became funded in 2013 by liquor sales in Ohio.
“In 2015 we substantially invested in our organization by adding professionals to our targeted industries, doubled the size of our marketing group, and enhanced our sales and development teams,” said spokesman Nick D’Angelo.
2. More companies are taking advantage of JobsOhio services. JobsOhio and partners negotiated deals with a total 330 projects last year, compared to 286 in 2014, according to the economic development agency which leads efforts to recruit businesses to Ohio.
Most businesses counted among the 330, including those new to Ohio and existing businesses that qualify, received some kind of tax break from a state or local government or a grant or loan from JobsOhio. Ohio Job Creation Tax Credits are approved by the public entity Ohio Tax Credit Authority.
However, not every business that expands in Ohio works with JobsOhio or a local government and might not have been included in this benchmarking measure.
This news outlet previously reported Ohioans are foregoing more money every year for cash incentives used to lure job-creating projects from businesses in competition with other states to the tune of $83.8 million last budget year.
3. The economy is better. Companies are also increasing their hiring and spending commitments with JobsOhio at a time when the economy is improving.
Ohio’s economy grew 3.6 percent in 2014 to state domestic product valued at an estimated $583.3 billion, according to the most recent Ohio Development Services Agency research on the topic. This Gross Domestic Product is a measure of goods and services produced in Ohio.
The average number of Ohio residents employed last year reached approximately 5.4 million people, up nearly 4 percent from a post-recession low of 5.2 million in 2010. However, the level of employment in Ohio has yet to surpass the average pre-recession amount of 5.7 million working residents in 2007, according to statistical estimates tracked by Ohio Department of Job and Family Services.
“The labor market is certainly in a better state than it was five years ago and I think it will continue to improve in 2016,” Janet Harrah, senior director of the Center for Economic Analysis & Development at Northern Kentucky University and a Cincinnati-area economist, told this reporter in February. “The one thing that’s fairly clear both locally and nationally is labor force participation rates are not increasing to the extent you would expect given the growth rate of jobs.”