In the realm of corporate buffalo hunts, Charlotte bagged a trophy this week, with Tuesday’s announcement that Cincinnati-based Chiquita Brands International is moving its headquarters to North Carolina’s Queen City.
The decision is notable for more than just a state and local incentive package worth up to $22.5 million for 417 jobs (i.e., $54,000 per job). Charlotte business leaders were so giddy they lit up the Duke Energy building Tuesday night in Chiquita yellow and blue. Some would say that’s just traditional Charlotte-style braggadocio. But this particular corporate move has some other distinctions:
• Charlotte’s bruised psyche. The city’s civic spirit needed good economic news, and the Chiquita headquarters, like the Democratic National Convention announcement earlier, will produce a bigger publicity jolt than your basic business expansion.
• The positive effects of immigration. Typically, businesses that move here cite the lower cost of living, the airport, a young workforce, friendly people, nice weather, etc. This time, another factor was the presence of bilingual, Latino professionals.
• Twitter. No, really. Chiquita CEO Fernando Aguirre is an avid Tweeter – @FdoAguirreCEO – so local Tweeps campaigned via the social media site, pointing out reasons Chiquita should come here. It was a corporate-recruiting first for Charlotte.
• The incentive package. The Charlotte Observer reports that the company sought, and won, an unprecedented grant of more than $5 million in city, county and state money. The appropriateness of offering millions in public money to lure business is too big a topic to get into here. For now I’ll just note that regardless of the disapproval of economists, taxpayers, small businesses and many politicians, the incentives arms race seems to be thriving.
In analyzing the economic impact of Chiquita’s move, it’s worth noting several things: It’s not a Fortune 500 company. Only the headquarters is coming; most of the 21,000 workers are in Central America. But it’s also worth noting that, contrary to national stereotypes, joblessness in the legendarily booming Sun Belt city of Charlotte is much higher (August rate for the region, 11.3 percent) than in the supposedly dying Rust Belt city of Cincinnati (August regional rate, 8.7 percent). That’s been true since 2008. Given all this, I asked economist John Connaughton of the UNC Charlotte Belk College of Business about Chiquita’s potential impact.
He pointed to a not-much-talked-about effect of the 2008 financial crash: the loss to Charlotte of many big bucks bankers, particularly after Wachovia was bought by Wells Fargo. “Folks that had those big incomes … they’re not here anymore,” he said. Charlotte lost a lot of spin-off dollars from those jobs. The Chiquita headquarters will be of particular help that way, he said, maybe more than in the number of jobs. (CEO Fernando Aguirre’s 2010 total compensation was reported at $5.6 million. Other top executives’ 2010 pay was $1.3 million to $1.5 million, according to Cincinnati.com.)
But for the overall U.S. economy, luring a company from one city to another is essentially a zero-sum game. I asked Connaughton about that. “That’s true, nationally,” he said. “But I don’t live in Seattle. I live in Charlotte.” Cincinnati is probably Ohio’s strongest city now, he said. Meanwhile, in Charlotte, “we’re doing a whole lot worse” than the nation.
Why put so much civic effort into recruiting a non-Fortune 500 company? Charlotte Chamber CEO Bob Morgan chuckled when I asked. “Charlotte likes a good announcement,” he said. In addition, the Chiquita brand is powerful and iconic, he said. “Charlotte is now tied to Chiquita and Chiquita is now tied to Charlotte.”
But another factor is this: Charlotte once seemed almost magically resistant to recession. This time, it wasn’t. “Charlotte has suffered a phenomenal blow,” Connaughton said, “more than anyone in this city has been willing to face .… This time we took it on the chin, big-time.” Civic spirits needed a win. This time, they got one.
Another distinction was the importance of Charlotte’s immigrant community. Aguirre is a Mexican native, and Chiquita’s bananas are grown in four Central American countries. In addition to strong international connections at Charlotte’s airport, Morgan said, “A large part of the dialogue in the recruitment process was their ability to recruit Spanish-speaking professionals.” The Latin American Chamber of Commerce was heavily involved.
Although many local residents hear “immigrant” and envision poorly educated laborers, in this instance the city’s changing demographics and newly diverse workforce was a key selling point.
But what was that about Twitter? As it happens, Aguirre is an avid Tweeter on the mini-blogging social media site, and not the kind who gets a staffer to do his keyboard work. So is Brian Francis, assistant to County Manager Harry Jones, who Tweets as @briandfrancis. Francis launched a Twitter campaign using keywords “#bananasforclt" and “#bananas4clt,” to convince Chiquita of Charlotte’s wonders. With help from Desiree Kane at CLTblog.com and Melisa LaVergne of the Chamber, Francis said, the campaign tallied some 1,440 “banana” Tweets since Sept. 25. Did it matter? Hard to say, of course. But Aguirre did notice, and remark on, the campaign. “Frankly,” he said, “it played a part in making us feel welcome.”
Aguirre used Twitter to send a message Thursday to Cincinnati: “Thx to the GR8 majority of Cinci based Tweeps who have understood the decision & reacted professionally. Stay positive.”
Will Tweeting now become part of the standard corporate buffalo hunt? Don’t bet against it.
Views expressed in this commentary are those of the author and not necessarily the collective view of the UNC Charlotte Urban Institute staff or the University of North Carolina at Charlotte.