On January 11, 2002 U.S. Steel announced Osceola, Arkansas as the location for their highly anticipated $3 billion steel factory. The impact of such an investment is hard to comprehend, as it represents the largest capital investment in the history of the state. When complete, 900 new high-paying jobs will hit the region.
At Ramsons we expect the following:
- While some of the 900 new jobs will be from the local employment pool, many more will be recruited or will transfer from other US Steel plants. Expect a boom in residential construction.
- 900 new jobs that carry an average pay of $100,000 means $90,000,000 million in pre-tax income which will naturally greatly benefit the restaurant and retail sectors. In short, the steelworkers will shop regionally and eat regionally. We expect three results related to this fact: 1) increased profits for existing restaurants and retail establishments; 2) new businesses in these sectors opening; and 3) higher sales tax revenues for cities and counties
- Cities within the region will be actively competing for these new workers. Modern-day economic development involves chasing people, not just smokestacks (which is why cities like Bentonville offer incentives such as cryptocurrency signing bonuses to relocate there). Any city within an hour drive of Osceola needs to be evaluating its recruitment strategy. We expect forward-thinking cities to invest heavily in recruitment strategies and quality of life amenities such as parks, trails, etc.
- Expect big things in Osceola and Mississippi County. For years the once-thriving cities within Mississippi County have suffered economic strain. The Blytheville Air Force base closing, an evolving farm economy and population decline have plagued the region since the early 1990s. But the last 10 years have seen the cities within Mississippi County stage a comeback. The most obvious was Wilson (aka “The Jewel of the Delta”) and the revitalization Mr. Lawrence brought through the Wilson Café, The Hampson Museum and of course the Delta School. Other investors saw the upside to investing in similar communities and started acquiring property in the downtowns of Osceola and Blytheville with the intent of revitalization. The region was making a strong comeback without the US Steel investment. What will happen now? We expect Osceola to thrive. The downtown is ripe for revitalization and the city has strong leadership in Mayor Wilson. Expect big things.
- Tailwinds: Steel plants aren’t stand-alone industries. They require massive amounts of material and they sell to massive buyers. This translates into additional industrial development opportunities in sectors that supply material to steel suppliers and those that buy steel in massive quantities (i.e. automakers). We expect a developmental domino effect. Northeast Arkansas is already recognized as one of the state’s industrial hubs and with this announcement (and the sure-bet announcements to follow) it is likely to soon be recognized as one of the industrial hubs in the Mid-south.
All in all, it’s a great opportunity for northeast Arkansas to finally escape the shadow of decisions made long ago.
Stories like Newport telling Sam Walton that he should consider Bentonville instead are known and told in every part of the region. But now we stand on the edge of major, almost incalculable economic opportunity.
For too long, the shadow of what could’ve been, coupled with the unique culture of the Mississippi Delta, has saddled the area with a collective chip-on-our-shoulder mentality.
A “we do more with less than you do with more” mantra may have served us well at times; it might have been the difference-maker in landing this steel plant.
This time the region is poised to take full advantage of the opportunity. We are about to see an unprecedented regional economic explosion.