This article is based on a recent webinar presentation Stephanie Few gave for Area Development magazine.
To paraphrase the often-quoted words of Charles Dickens, for economic development professionals, 2020 was the best of times and the worst of times.
January and February started extremely busy, with deal after deal launching during what is normally a slow time for economic development. Womble Bond Dickinson economic development attorney Stephanie Few said 2020 was looking like a banner year for projects. But then then COVID-19 pandemic effectively hit the pause button on the entire industry throughout the nation.
“March hit the economic development community particularly hard,” she said. She said 98 percent of projects she was tracking went on hold in March and April. Companies were greatly concerned about the pandemic’s impact on customers, and were reluctant to move forward with expansion plans. The pandemic also disrupted global supply chains, meaning many goods didn’t have a place to go.
In the interim, Few said there was a short-term uptick in warehousing rental in mid-2020, as manufacturers looked for additional space to store excess inventory. Other good news could be found in the life sciences sector, which experienced a surge in demand. However, this meant many life sciences companies had to pause expansion efforts, as every bit of energy had to be focused on meeting demand.
Few said those projects are starting back and that 2021 looks to be a big year for economic development in life sciences. As Vice Chair of SCBIO, South Carolina’s public/private organization to support the life sciences industries, she follows this industry on a daily basis, and what she sees now gives her a great deal of optimism heading into the new year.
“For those life sciences deals, we are seeing them come back bigger, better and stronger than ever—with an even tighter time frame than before,” she said. This sector typically offers skilled jobs with high pay and great benefits, making life science investments even more attractive.
“We’re seeing a renewed effort in this country on supporting the life science industry (as a result of the pandemic),” Few said. State decision-makers are examining their incentives packages to make sure they are competitive for companies in the life science sector. In making these decisions, she said the two main considerations are 1. Permanent job creation (with a focus on average salary) and 2. Capital investment.
Few said such incentives should consider the unique needs of the life science sector. For example, in life sciences, production often isn’t immediate—it may depend on years of research and development, then regulatory approval. So lawmakers may consider delaying property taxes on life sciences investments until the FDA approves the drugs or medical devices in question.
While the economic development industry was paused, Few said she and others in the industry were able to have less hectic, one-on-one conversations and compare notes about the state of economic development around the country. She named Georgia, North Carolina, Texas and Virginia, along with her own home state of South Carolina, as states that are doing a good job of attracting life science jobs.
November brought the outstanding news that two pharmaceutical companies have conducted COVID-19 vaccine trials with 90+ percent efficacy rates. Few said the table is set for 2021 to be a big year for economic development in general, and in the life sciences sector in particular.
“The money is there, the markets are strong and the customers are there,” Few said. “I think it speaks to the resiliency of the human spirit that we are hearing so many good stories.”