Governor Beshear Promotes Kentucky's Aluminum Industry, Announces Incentive Approval for Rio Tinto Alcan

Gov. Steve Beshear today visited Rio Tinto Alcan’s aluminum smelter in Sebree to tout the state’s aluminum industry and promote future opportunities for the industry in Kentucky.  Gov. Beshear was joined by officials from Rio Tinto Alcan, one of only a handful of aluminum smelters remaining in the United States, and representatives of the Kentucky Aluminum Network, a not-for-profit membership organization of Kentucky aluminum producers.

Kentucky is one of the top aluminum producing states, employing more than 13,500 Kentuckians and generating $100 million in state and local tax revenue each year.  The average annual wage for a primary metals job in Kentucky is more than $52,000.  In 2005, more than $4.3 billion of primary aluminum products were shipped outside the state.  Transportation, containers and packaging industries make up the largest markets for Kentucky aluminum establishments.

“The aluminum industry in Kentucky is a critical piece of the industrial landscape,” said Gov. Beshear.  “Stabilizing our existing industries and creating opportunities for growth and expansion in aluminum are key to Kentucky’s short and long-term economic future.”

To compete on a global basis with newer, more efficient facilities around the world, many of Kentucky’s larger industrial aluminum plants are seeking ways to invest and reinvent their processes.  To help facilitate this goal, Gov. Beshear announced the approval of up to $15 million in total state tax incentives for Rio Tinto Alcan to encourage the Sebree facility to make long-term investments in order to remain sustainable and globally competitive.

Rio Tinto Alcan is evaluating the installation of equipment to increase Potline amperage, thereby allowing the plant to be more efficient in aluminum production.  Additionally, the plant is considering the construction of a new Bake Furnace that would be more environmentally friendly and efficient in baking anodes that are utilized in Potlines.

“The state incentive package is another important step in our effort to acquire corporate approval for these two projects,” said Stephane Leblanc, plant manager of Rio Tinto Alcan.  “The improvements are important components for the longevity of the Sebree operation in western Kentucky.”

Rio Tinto Alcan currently employs 500 Kentuckians and is one of the largest employers in the Henderson County community.

Kentucky is home to more than 120 aluminum-related facilities in all, including, Logan Aluminum in Russellville, Aleris Rolled Products in Lewisport, Gibbs Die Casting Corp. in Henderson, Century Aluminum of Kentucky in Hawesville, Aisin Automotive Casting in London, Cardinal Aluminum Company in Louisville, and many more. 

Kentucky offers several advantages to firms in the aluminum industry, including: low utility costs, central location, a quality workforce and ports along the Ohio and Mississippi rivers.  In fact, the Owensboro Riverport is one of only two licensed warehouses approved by the New York Mercantile Exchange to serve as the delivery point of primary aluminum traded on its COMEX Division aluminum futures contract.

“Aluminum is important to Kentucky and today’s announcement demonstrates that importance,” said Kentucky Aluminum Network board member Kenny Barkley.  “Kentucky produces nearly one-third of the nation’s aluminum, and it is because of the state’s commitment to growing this signature industry that aluminum can continue to grow in Kentucky.”

The Commonwealth’s strong automotive industry is also an advantage to the aluminum industry.  Aluminum usage in automobiles has increased dramatically in recent years, and is now only behind iron and steel in average vehicle content.  Kentucky is currently ranked 3^rd among the states in light vehicle production and is home to nearly 450 motor vehicle-related suppliers. 

“As more motor vehicle-related firms move to Kentucky and automobile manufacturers increase their use of aluminum, Kentucky becomes a natural home for aluminum-related companies,” added Gov. Beshear.

A profile of Kentucky’s aluminum industry is available on the Cabinet for Economic Development’s website athttp://thinkkentucky.com/kyedc/pdfs/Aluminum_Report.pdf.  Additional information is available by contacting the Kentucky Aluminum Network at

(877) 434-3766.

Greater Owensboro Wage and Benefit Survey

The Greater Owensboro 2010 Wage & Benefit Survey is open to all
industries in the Owensboro-Daviess County area.  The form is designed
to provide beneficial information for use by local HR professionals,
potential industry, and the Economic Development staff.  Participation
is confidential and results will be available Spring 2010.  For more
information contact: Sharla Austin Darnell at EDC.  


If you are an employer and would like to participate in the survey, visit the following link: http://edc.owensboro.com/_documents/2010_Wage_&_Benefit_Survey.pdf

Recession has Many Re-thinking Economic Development Strategies

Owensboro is not the only region re-inventing itself with new approaches to economic development.  Many metro areas in the United States, especially those hard hit by the economic downturn, are shifting economic development strategies to gear up for end of the recession. 

In Atlanta, the Metro Chamber of Commerce has embraced a strategy that focuses less on large sectors like bioscience or technology and more on “bite size” niches within those categories like pharmacology, digital medical records or video gaming. 

St. Louis is also using a more “granular approach” using its expertise in plant science to identify specific subsectors to develop. 

The Economic Development Corporation of Kansas City has embraced entrepreneurship and innovation as a focus rather than industry attraction in the old-line sectors, according to EDCKC President Jeff Kaczmarek. 

EDC Board Chair Darrell Higginbotham said Owensboro is already ahead of the curve in embracing many of these strategies in the approach the board adopted as far back as 2006.  For example the emphasis on biotechnology with the work of Kentucky BioProcessing is really an emphasis on a “bite size” niche of plant pharmaceutical and therapeutics, according to EDC President Nick Brake. 

EDC began an emphasis on high tech development and support for entrepreneurs thanks to funding from the state for the Emerging Ventures Innovation Center program headed by Madison Silvert.  Earlier this year, Silvert was invited to speak to the Kansas City EDC about the success Owensboro has had in nurturing entrepreneurs.  In the past three years, EDC has added significant infrastructure to support high tech company development in Owensboro.  Emerging Ventures has been successful in supporting newly formed companies and creating jobs with pay levels well above the median income in the region. 

“Working with entrepreneurs and high-tech startups has gained a lot of momentum with all of the plant biotech activities at Kentucky BioProcessing,” said Silvert.   “Our new business accelerator, the Centre for Business and Research will provide an opportunity of an entirely new dimension of economic development for this region.”


To learn more about the efforts of GO-EDC and read the Owensboro economic development strategy, visit jobs.owensboro.com. 

Brake: Future bright for city

By Keith Lawrence, Messenger-Inquirer

Published: Friday, February 5, 2010 12:00 AM CST

Owensboro is "well positioned for the future, and we are on the move," Nick Brake told the Greater Owensboro Chamber of Commerce's Rooster Booster Breakfast on Thursday.

Brake, president of the Greater Owensboro Economic Development Corp., said, "Lord knows, we've had our share of challenges in the last year."

But despite the loss of 1,700 jobs in the three-county Owensboro metropolitan area in the past year -- 800 of them in manufacturing -- the Owensboro metro's unemployment rate is lower than the state's and the nation's, he said.

The local metro's jobless rate was 9.1 percent in December. Kentucky's unemployment rate was 10.4 percent, and the nation's rate was 9.7 percent.

Brake said the EDC is focusing on "three T's" -- targeted industries, technology-based companies and talent.

In the past two years, he said, Owensboro has attracted 13 new technology-based companies, which have an average salary that's three times the community's per capita income.

Most of those companies have only a handful of employees so far, however.
But Brake said, "Our volume of new companies is far greater than other parts of Kentucky."

The most significant long-term issue facing the community, he said, is attracting and keeping talented workers.

"Young people are the resource of the 21st century," Brake said.  And they are attracted to attractive, vibrant communities, he said.

"I can't overstate urban appeal" as an issue, Brake said.

That's why the community is spending $120 million on downtown revitalization, he said.

EDC's focus is currently on attracting entrepreneurs, retiring Baby Boomers and young people who have the opportunity to move their jobs with them, he said.

Brake said Owensboro Community & Technical College retrained approximately 500 workers last year for new jobs.

"A top issue among our existing employers is the widening skill gap due to the transition from a production-oriented to a technical-oriented work force," he said. "While product assembly jobs are on the decline, many of our regional manufacturers are hiring skilled technicians in industrial technology."

Brake said the demand for skilled technicians "will only increase due to the pending retirements in many of our advanced manufacturing facilities."

Closing the "skill gap," he said, "is a huge part of our ability to attract and retain these jobs in the future. We have lost projects due to the lack of skilled technicians in our work force. This is a critical issue for this region."

Brake said EDC will continue to work with Hancock County to attract industrial prospects, because it has plenty of available land along the river.

"The biggest projects we've courted have focused on land in Hancock County," he said.

OMHS construction to bring 700-1,200 local jobs

The construction firm for the new Owensboro Medical Health System facility will contract between 700 and 1,200 local workers for the construction project.  

Turner Construction won the bid to build the new hospital and met with local employers Tuesday.

The Nashville-based company said it will only bring about 20 management workers to Owensboro.  The rest of the jobs will be hired locally.

"It just makes sense from a cost perspective," Merrill Bowers with Turner Construction said. "If the labor is here why don't we use the labor here?"

"There's probably more trades involved in a health care project than in any other type of project in the respect that if we were comparing it to an office building or a retail center," Bowers said.  "We really have the entire gambit of the industry that will be required."

Economic Development Strategy Focus of February Chamber Breakfast

Nick Brake, president of the Greater Owensboro Economic Development Corp., is the guest speaker at the Feb. 4 Rooster Booster Breakfast.  Brake will talk about nationwide economic development trends and what the EDC is doing to create sustainable jobs in the community.

To read more about what the EDC is doing to create jobs for the Greater Owensboro region, please visit jobs.owensboro.com.  Click the following link to view the Greater Owensboro Economic Development Strategy.  Visit the Chamber's website for more information about attending the Rooster Booster Breakfast (http://chamber.owensboro.com/).

Workforce Development Partnership creates Retraining Opportunities for High Growth Jobs

Shawn Payne, an instructor at Owensboro Community and Technical College, knows how to reach the dislocated workers in his Quick Jobs class at the college.  He was once one of them.  Payne was laid off in 2005 from Premium Allied Tool.  Like many impacted by the recent plant closings and layoffs he was able to enroll at OCTC to complete a retraining program and finish a degree.  He was eventually hired by the college to teach highly sought after skills in advanced manufacturing. 

The Quick Jobs program is a partnership between OCTC, the Green River Workforce Investment Board, and the Greater Owensboro Economic Development Corp. to provide retraining options in high demand areas.  Many dislocated workers are coming out of jobs in production and product assembly processes where few similar jobs exist, not only regionally, but nationally. 

“We have a workforce in transition,” said EDC President Nick Brake.  “The manufacturing workforce has changed significantly in the last couple of years.  Production jobs have been eliminated by automation or exported elsewhere.  Most jobs in manufacturing require skilled technicians that can operate and maintain a piece of high tech equipment.” 

The manufacturing workforce is also been impacted by a large number of skilled technicians that will become eligible for retirement in the next couple of years.  “Nearly half of the skilled workforce in the aluminum industry in Hancock County will likely retire in the next three years,” said Brake.  “Retraining programs like Quick Jobs will be critical in meeting the needs of our existing companies in years to come.” 

At OCTC, the IMAC or Industry-Based, Modular, Accelerated Credentials emphasizes the Industrial Maintenance skills most in demand in the advanced manufacturing facilities in the region.   Instructors like Payne use a hybrid learning model that lets students combine interactive, Web-based classes with hands-on, job-specific skills through simulations and in an open lab.  Students can set their own schedules, learn at their own pace and earn college credits toward a degree. 

In addition to advanced manufacturing, the Quick Jobs model provides training options in other high demand areas, such as allied health, medical billing, energy, welding, and construction.   “Energy is another growth area in the Green River region,” said Tonya Logsdon, associate director of the Green River Workforce Investment Board at GRADD which administers the funding for many of the dislocated worker programs.  “An aging workforce in the energy sector combined with new opportunities emerging in coal, and new alternative energy processes will mean opportunities for future workers requiring skills in instrumentation, electrical technology, and coal technology.” 

Construction is another area where there will likely be opportunity in the coming months for skilled workers, according to Logsdon.   “With all the construction projects planned from the new hospital to new roads and school projects, we expect a significant need from the local workforce.” 

In health care, OCTC@OMHS is the work-based associate degree program for employees of OMHS to work toward a nursing degree.  Hospital employees now working in entry-level jobs such as nurse assistant, medical assistant, housekeeper, clerk and patient care technician are eligible to apply for the program.  It is expected to help the hospital train the work force it needs as it moves forward with an expansion that will require more than 500 additional nursing jobs over five years.

“Our community college is a huge asset in the work we do with dislocated workers, “Brake said.  “While a plant closing is never a good situation, we’re able to provide affected workers the opportunity to receive free retraining all the way to a postsecondary degree.   This not only benefits the worker, but allows the community to retool its workforce in high-growth areas.” 

“There are success stories out there in almost every sector of the regional economy,” said Logsdon.  “The program is designed to make a difference for people as they face the future after a layoff.”