South Carolina Economic Overview
South Carolina generates a gross state product of $53.2 billion. Year-round tourism is the state’s leading industry, but it also enjoys a robust and diversified manufacturing industry. A number of foreign countries have also opened plants in the state, making South Carolina one of the top recipients of foreign capital investment in the nation. Although cotton was once the leading industry in this Cotton Belt state, its dominance ended by the 1950s as factories were built and the majority of farmers left agriculture. Farmland decreased from being more than half of the area of the state to around a fourth.
English settlers came to what later became known as South Carolina in 1670, and soon developed a brisk trade in Native American slaves. Revenue from the slave business was used for slaves from Africa, who labored on rice and indigo plantations and raised other crops. During the American Revolution, 30 percent of South Carolina’s slaves escaped. Still, agriculture based on slave labor remained an important part of the economy until after the Civil War.
With the invention of the cotton gin, cotton processing sprang up all over the state. Beginning in the 1880s, South Carolina’s textile industry was a major part of the economy and the Carolinas became the textile center of the country due to cheap power along the rivers and the low wages paid to workers.
During the next 100 years, although South Carolina had its share of crop failures and recessions, textiles flourished. Due to the cotton crop’s devastation by a boll weevil infestation in 1920, many farmers changed from growing crops to raising cattle.
By the 1970s and 1980s, the import of cheaper textiles from overseas caused many of the state’s textile mills to close. New industries such as paper and chemical manufacturing developed, and large military bases opened in the state. Currently, a shift from manufacturing to service industries including trade, government, and tourism is occurring in South Carolina.
While agriculture is no longer as vital to South Carolina’s economy as it used to be, it still is an important industry. Around 27,000 farms operate in the state, producing $2.35 billion worth of agricultural products. Livestock accounts for $1.55 billion, with poultry and eggs worth $1.28 billion, followed by cattle and calves at $105 million, and hogs and pigs at $77 million. Top crops in the state are nursery/greenhouse products at $227 million; grains, dry beans, and dry peas at $214 million; and vegetables such as melons, potatoes, and sweet potatoes at $126 million. South Carolina ranks third in the country in tobacco production, worth $73 million annually to the state.
BANKING AND FINANCE
Close to 102,000 people are employed in the financial sector in South Carolina, which includes around 3,500 establishments. There are 89 FDIC banks in the state, with a total of roughly 12,000 employees and assets of $57.2 billion. The 67 commercial banks have 10,000 employees and assets of $49 billion. The 22 savings banks have 1,800 employees and assets of $8.2 billion. Some of South Carolina’s banks, such as the First National Bank of the South, Palmetto State Bank, and First Citizens Bank of South Carolina, have been in business for a century.
A total of 35 newspapers are published in South Carolina, and the state has 21 television stations and 167 radio stations. According to the U.S. Census Bureau, the broadcasting sector has annual revenues of some $12.7 million. The state’s 22 telephone companies use thousands of miles of fiber optic cables. Fifteen of these telephone companies are national or worldwide companies that employ 7,700 local workers.
The construction industry in South Carolina employs some 96,400 workers, a drop of 31,000 from 2006, when construction was at its peak before the worldwide economic crisis. Average annual pay for construction workers in the state is $40,300. Nonresidential construction spending accounted for $9.6 billion in 2007, and direct construction spending contributed $23 billion to the gross state product. Around 13,000 construction firms operated in the state in 2007, with 91 percent employing fewer than 20 workers.
As of 2010, South Carolina has 1,144 public primary and secondary schools and spends an average of $8,706 per child annually. There are 54 colleges and universities in the state, including two-year colleges. The University of South Carolina is the largest institution, with almost 30,000 students enrolled, more than 1,600 faculty members, and an endowment of $425.2 million. Founded in 1770, the College of Charleston is the oldest institution of higher learning in the state and has an enrollment of roughly 11,000 students, 800 staff members, and an endowment of $40.4 million.
More than half (53 percent) of South Carolina’s electricity is generated by the state’s four nuclear power plants, ranking it third in the country for nuclear power use. Coal from Kentucky generates about 38 percent of electricity. Natural gas accounts for another four percent, followed by hydroelectric sources at three percent, and petroleum and renewable energy at one percent each. The largest sector of energy consumption is industry, which consumes roughly 20 percent of the total energy used in the state, followed by transportation. South Carolina’s per capita electricity usage is higher than the national average, but rates are lower. Since 2006, South Carolina has witnessed investment of more than $736 million for alternative energy companies, which has created more than 1,000 jobs.
The film industry in South Carolina pays more than $32 million in annual salaries and wages. To encourage film production, incentives not offered by other states include cash rebates within 30 days and cash rebates for salaries of even out-of-state actors. Productions of more than $250,000 are exempt from paying sales tax and accommodations taxes as well. The arts generate more than $8 million annually, with artists earning a total of more than $25 million.
More than 2,400 people are employed by South Carolina’s property-casualty insurers at an annual combined payroll of $139 million. State premium taxes account for $126 million annually, and property-casualty insurers pay out a yearly average in claims of $1.5 billion to car owners, $505 million to homeowners, and $1.3 billion to companies and stores to cover losses.
South Carolina’s manufacturing sector includes chemicals, textiles, synthetic fibers, pharmaceuticals, dyes, and plastic resins and contributes $19.3 billion to the gross state product. There are approximately 5,200 companies, which employ a total of about 272,000 workers, a loss of 24,393 jobs since August 2008. The average annual wage in manufacturing is $44,876. The top manufacturing sector is industrial machinery and equipment, which provides 37,000 jobs, followed by textiles and apparel at 31,000 jobs, and transportation equipment, at around 27,000 jobs. The three leading manufacturing cities are Greenville, Spartanburg, and Columbia. Manufacturers’ property taxes of more than $521 million make up almost 13 percent of the entire property tax revenue of the state.
MINING AND EXTRACTION
South Carolina is home to 82 mining operations, which provide direct employment to 2,500 workers. The average miner’s salary is $47,000, and total annual payroll is around $120 million. Limestone and granite are the leading quarried materials in the state, which also produces mica, kaolin, and vermiculite. A total of $1.6 billion is generated by the mining industry, including $570 million worth of minerals and metals and output from suppliers in the state. Although 130 gold mines and sites used to operate in South Carolina, currently only four mines operate, including one in Haile, which produces 700 ounces of gold per month.
There are roughly 24,500 nonprofit/tax exempt organizations in South Carolina. Of this number, roughly 8,500 are charitable organizations, 6,200 are educational organizations, 3,700 are religious organizations, and the rest are other organizations ranging from social welfare groups and burial associations to organizations to prevent cruelty to children or to animals. These organizations report a total of $29 billion in assets and $17 billion in combined total income. The highest annual income reported by a single organization was $1.2 billion, but the average amount is $2.5 million.
Some of the state’s leading retail sectors are automobile dealerships and food and beverage stores. There are roughly 320 new car dealerships in South Carolina with a total of about 14,100 employees at an average yearly salary of $45,108. Total sales are $7.4 billion annually. South Carolina has 664 retail grocery stores, which add up to an $8.1 billion market. The top three retailers in the state are Walmart (74 stores with a 36 percent market share), Bi-Lo (132 stores and a 17 percent market share), and Food Lion (143 stores with a 13 percent market share). Walmart stores employ more than 27,000 workers at a full-time hourly rate of $11.70 and collect sales tax of more than $240 million annually. It also pays more than $35.3 million in state corporate tax.
Nearly 4,000 high-tech firms operate in the state. Their employees earn an average annual salary of $58,000, for a combined annual payroll of $2.6 billion. Federal research and development expenditures for South Carolina universities amount to $260 million, and state and local government contributes about $34 million. Some 11,300 people work in IT, including computer systems design and related services. The biotechnology and pharmaceuticals sector is expanding, and firms such as Bausch & Lomb and GlaxoSmithKline have plants in the state.
There are 844 miles of interstate highways in South Carolina, around 9,400 miles (15,130 km) of state primary roads, and 31,890 miles (51,320 km) of secondary roads. Railroads have approximately 2,280 miles (3,670 km) of track in the state. Of the six commercial airports, Charleston International Airport is the busiest in terms of passenger volume, with 1.1 million passengers annually, but Columbia Metropolitan Airport handles the most freight, at 73,500 tons. The Port of Charleston ranks sixth in the country in terms of U.S. waterborne foreign trade, as around $61 billion worth of goods pass through it yearly.
TRAVEL AND TOURISM
Tourism plays a very important role in the state’s economy, contributing $16.7 billion of direct and indirect revenues to the gross state product. There are some 200,000 employees who work in tourism, which represents 10 percent of the workforce. More than 14.6 million tourists flock to South Carolina’s beaches, golf courses, and amusement parks. The world’s largest collection of outdoor sculptures is located in South Carolina, as is the oldest landscaped garden in the country.
South Carolina has a strong automotive industry, ranking third in the country for automobile manufacturing growth. Its 496 automotive companies have estimated annual sales of $10.9 billion and employ some 39,000 people. BMW’s only North American production facility, with 4,600 employees, is located in the state, as are Michelin’s North American headquarters and some manufacturing facilities. In 2008 some 2,400 jobs were added to the automotive sector and $1.2 billion of capital was invested in its expansion.
-World Trade Press