Is Charlotte just banking? | CLT Blog
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Is Charlotte just banking?

Posted on 30 Sep 2008 by Justin Ritchie

A question we’ve all asked from time to time and a perception that we have nationwide.

Is Charlotte just banking?

That concept is made even more important today as Citibank bought out Wachovia, betting on a federal bailout of US banks which may never come.

Let’s take a quick look at the local economy to see if it is robust and diverse enough to weather such a tumultuous nationwide financial storm.

Charlotte is home to seven Fortune 500 companies (Bank of America, Lowe’s, Duke Energy, Sonic Automotive, Family Dollar, Goodrich, and SPX) and 21 companies with more than $1 billion in annual sales. Clearly a business town. But is it all based on the financial sector? As the second largest financial center in the country we have easily earned a reputation as a banking center. But surprisingly the largest portion of the local economy comes from wholesale trade, closely followed by services, manufacturing and construction.

As of April 4th, 2008, out of the 565,415 people employed in Mecklenburg County, only 54,303 were in finance and insurance. While the banks have long represented us on the national spotlight, the Queen City is the heart of the fourth largest manufacturing center in the US. Textiles drove this manufacturing expansion initially, but now the optical tech, defense, plastics and medical equipment industries are building a new infrastructure of high-tech jobs.

One of the main problems with manufacturing is that most think of it as an assembly line, or a massive plant full of chemical laden air and dust with a vastly undereducated employee base. The new manufacturing revolution requires quite a different employee. Workers and technicians find themselves as a part of an intelligent assembly process for equipment and end products. High-tech manufacturing employees are working on multi-faceted complex control panels and machining systems that require an adept and talented workforce. Mecklenburgers might be surprised to know that some of the solutions for the 21st century are being designed and built in the their backyard. Two examples are General Dynamics which is developing chemical detection devices that are as small as magnets on a refrigerator while Sencera is creating the next generation of thin-film solar photovoltaics that will fuel the new energy economy.

But it is not just technology that the region produces — it’s also food, due to Pepsi, Lance, Frito Lay, one of the largest Coca-Cola bottlers in the nation, and the Compass Group.

Most dramatic over the last decade has been Charlotte’s transition into an engineering town with a global impact. The recent conflict in Georgia affected one local firm’s designers, as their project was a mixed-use development in the former soviet nation. An excellent example of why everyone should care about globalization. Areva, Shaw, the Electric Power Research Insitute (EPRI) and Duke Energy are working on solutions to energy challenges, while companies like Fluor are solving the most complex engineering problems in the world. Firms like the latter are building an energy economy center for the city as the national focus on the issues surrounding this business becomes stronger in focus every day.

Perhaps the most surprising aspect of Charlotte’s economy to those that regard the city as “banktown” (with all the stereotypical images of up-tight suits that indulge in only the expensive) is the booming local creative economy. Amazing national work has been done by local advertising and branding firms Boone Oakley and A3 while Charlotte Arrangements is the US leader in stage set-ups.

While Charlotte has received a tremendous economic contribution from banking institutions, it has grown far past its one dimensional mantra of the 90s. Now, as the most economically dynamic and energetic city of the southeast, we will face tough challenges presented by national financial restructuring. If a de-emphasis on banking is in our future, it will only reveal Charlotte as the multi-faceted business leader it has become.

Comments

  1. Avatar of Justin Ruckman
    Justin Ruckman 30 Sep 2008 at 6:21 AM

    I think it’s safe to say we’re banking on more than just our financial industry. Surely recent events will make an impression, on us and the rest of the country. But we have the opportunity now to prove our diversity and strengths.

  2. Avatar of Rosie Reilman
    Rosie Reilman 30 Sep 2008 at 8:23 AM

    Nice write up. I wish I could find the URL but a month ago I saw an article of Charlotte’s top growing companies in 2007 there were a lot of other companies besides banking so I think you’re right there is a whole lot more that Charlotte has to offer — thank goodness.

  3. jak 30 Sep 2008 at 10:45 AM

    @ rosie — you can get that info (fastest growing companies) on Inc 5000, http://www.inc.com/inc500 — use their advanced search to sort for NC or Charlotte.

    very cool post. taking all your points, banking is still so very important in Charlotte in present day. I think we are getting closer to where we need to be in regard to economic diversity, but even if we only looked at Bank of America, their revenue (117 mil) is more than all the rest of the Fortune 1000 companies (13 total) in greater Charlotte combined. The banks are the main reason Uptown Charlotte has changed so dramatically over the past 15 years. They have driven much of the growth and infrastructure that we see today.

    That being said, there is also Nascar, the new research campus, J&W, growth in tourism and as a convention city, and many emerging industries (that you detailed very well) that are helping diversify our economy. I hope this trend speeds up however. The state, city, and region need to invest more in emerging industries as they are with the research campus. We should become leaders in green energy for one. But I see little in that direction currently.

  4. Avatar of Justin Ruckman
    Justin Ruckman 30 Sep 2008 at 11:30 AM

    From the joint statement released by Charlotte officials today:

    It is important to note that our economy remains diverse. While banking is the leading sector, ours is not a one-industry town. Manufacturing, transportation, health care, motorsports, tourism and many thriving small businesses drive our economy. And with Bank of America’s recent purchase of Merrill Lynch, we remain the second-largest banking center in the United States, behind New York City and ahead of San Francisco.”

    Original article at Charlotte Business Journal.

  5. Justin Ritchie 30 Sep 2008 at 4:47 PM

    jak pointed out to me: “Think you missed Nucor as a fortune 500 in your cltblog article — we should have 8 — it was 9 before the wachovia stuff went down”

    I’m pretty sure that he is right on that one too.

    So after you read through the article remember that NuCor is headquartered here.

  6. Avatar of Ben Ullman
    Ben Ullman 30 Sep 2008 at 8:41 PM

    Great summary. (Whose photos? Nice.)
    I just realized that the 2008 Citistates Report on Charlotte was out, including articles such as:
    A 21st-century game plan for the Charlotte region
    and
    Region has power to be a leader on energy

  7. Avatar of Justin Ruckman
    Justin Ruckman 30 Sep 2008 at 8:52 PM

    Those are all Ritchie’s shots. I’ll make sure photos are better cited from now on.

  8. Justin Ritchie 3 Oct 2008 at 2:55 PM

    I can post links to those photos or feature them on my photography website that I rarely update: http://jritchphotography.wordpress.com