Florida is one of the top producers of aircraft parts according to a new report from the government watchdog group Florida TaxWatch. But the group warns the state won’t continue to dominate the industry if it doesn’t continue efforts to reduce manufacturing costs and improve the quality of its work force.
According to the study, Florida housed nearly 250 aircraft manufacturing plants last year – ranking it second only to California. But states, like Texas with 215 plants, are closing in quickly. TaxWatch economist Jerry Parish says tax policies can be a big factor when companies are deciding whether to open manufacturing centers in the state.
“There is a tax holiday for three years on sales tax machinery and equipment. What TaxWatch believes should happen is since we tax this machinery and equipment twice—we taxed it, [before the tax holiday came into effect], when you bought it, and through tangible personal property tax—that they should end this tax on machinery for manufacturers because it’s double taxation,” Parish says.
And that’s something Florida Governor Rick Scott has been pushing for as well. Scott has been touring the state talking about his “Next Generation” jobs plan. He made one campaign-style stop at aerospace and defense manufacturing company, Craig Technologies.
“If we don’t continue to buy machinery and equipment, we’re not going to get more jobs in the state,” Scott says. These advance manufacturing jobs like we have here at Craig are not going to happen. So that went through 2017. We need to make it permanent so companies like Craig can continue with long term planning.”
Parish says beyond the sales tax exemption, Florida has also uses economic incentive programs to entice aircraft and parts manufactures to move to the state. And he says the weather doesn’t hurt either.
“One of the things that is important in the decision making of a lot of companies, the heads of the companies, is where they want to live. And Florida is a great state to live, a great state to raise a family, so we get some business relocations for just that reason,” Parish says.
Parish says a high number of military veterans living in Florida creates an ideal workforce for the aircraft industry, and he says increasing the state’s focus on Science, Engineering, Technology and Math, or STEM education could help seal the state’s position. That’s another focus Scott’s been pushing on his tour. He wants to use summers to give teachers STEM-related internships so they can bring what they learn back to the classroom. In 2013 more than 12-thousand Floridians had jobs related to aircraft manufacturing with average salaries ranging from $57-thousand to $81-thousand.
