Obama’s Economic Tour Starts at Canadian Manufacturer in NC
(WASHINGTON) -- President Obama on Wednesday kicks off a three-day post-State of the Union tour to promote 'made in America' with a visit to a Canadian auto parts manufacturer in North Carolina.
The Linamar Corp. facility in Asheville illustrates the positive economic trends that Obama claimed credit for in his address Tuesday night and wants to encourage in a second term: more American and foreign companies moving manufacturing operations to the U.S. ("insourcing"); steady growth of skilled private-sector jobs; and effectiveness of government-sponsored hiring incentives.
In 2011, the company first set up shop in Asheville, lured by state grants and a pool of workers with technical skills to do the job. It employs about 360 workers now with plans to hire 250 more and make a $75 million capital investment over the next five years.
“Training grants, tax credits, a fair business tax rate -- those things really work,” Linamar President and COO Jim Jarrell told ABC News. “We moved to North Carolina to take advantage of the incentives, knowing, however, that eventually we’d have to stand on our own two feet.”
But Linamar is also a bellwether for an economic recovery that continues to limp along, with little future “stimulus” in sight.
The company’s North Carolina facility, which makes key engine, transmission and driveline components for industrial machinery, feeds Caterpillar and Volvo. Demand from those companies only follows demand from builders and construction firms, Jarrell said. That demand continues to be “a little slower than anticipated out of the gate.”
The latest Congressional Budget Office projections, released last week, underscore the concern:
- Unemployment is expected to hover around 8 percent through the next year, which would be the sixth consecutive year with unemployment above 7.5 percent of the labor force -- the longest such period in 70 years.
- Gross domestic product (GDP) growth is projected to “remain below its potential” through the end of Obama’s second term, in 2017. “That subdued economic growth will limit businesses’ need to hire additional workers, thereby causing the unemployment rate to stay near 8 percent this year,” the CBO projects.
Obama said on Tuesday that policy makers must "reignite" the engine of job growth to boost the middle class as a top priority.
He will highlight his plan for that, including a call for universal access to pre-school education, during a stop in Atlanta on Thursday. He then visits Chicago on Friday.
Copyright 2013 ABC News Radio