KERNERSVILLE, N.C. -- A partnership between two behemoth builders of excavating machinery said Friday it plans to add 340 jobs at a North Carolina plant in return for incentives of more than $5 million while promising salaries below the local average.
Deere-Hitachi Construction Machinery Corp. said it will expand its Kernersville, N.C. plant that now employs more than 700. The plant is a part of a 24-year partnership between Tokyo-based Hitachi Construction Machinery and Moline, Ill.-based Deere & Co. to manufacture both Hitachi and Deere brand excavators.
The expansion will allow Deere-Hitachi to increase production of excavators for the mining and construction industries, the company said.
State and local governments have promised Deere-Hitachi tax breaks and other incentives worth more than $5 million if the company adds the jobs within four years and sustains them for nine years. The jobs will pay an average of about $42,102 plus benefits, $486 less than the average Forsyth County wage. The county's unemployment rate in August was 9.5 percent.
State job-hunters have generally dangled help from taxpayers to sway corporate decisions if the wages were above average, though that isn't required by state law. But fewer manufacturing companies like Deere-Hitachi are planning big expansions.
The loss of manufacturing jobs was felt especially hard in North Carolina, which in August posted the fifth-highest jobless rate in the country at 9.7 percent.
Almost 22 percent of North Carolina's economy was based on manufacturing before the Great Recession began in December 2007, compared to the national average of 13 percent, according to a recent report by the University of North Carolina at Chapel Hill's Global Research Institute.
Local officials said last month Deere-Hitachi was mulling whether to expand in Kernersville or expand a Japanese plant instead. Gov. Beverly Perdue's office said she met with Hitachi executives during her trip to Japan last month.
North Carolina job-hunters are targeting manufacturers of earthmoving, mining and construction equipment that are boosting production to meet the demand from expanding economies in Asia and South America, state Commerce Secretary Keith Crisco said.
In the past two years, Caterpillar Inc. has announced it will add about 1,000 jobs at a Winston-Salem plant that builds axles for massive mining equipment, a Clayton factory to supply the world with small-wheel loaders, and a plant building equipment used in landscaping and construction. But the state was also stung in February when Caterpillar chose Georgia over North Carolina for a factory that will employ 1,400 building tractors and excavators for export and domestic markets.
"This general category of business, of excavating and other heavy equipment which creates infrastructure, is a growth industry worldwide," Crisco said.
Emery Dalesio can be reached at http://twitter.com/emerydalesio