By Mark Kelly
Here’s a fact: Of all goods manufactured each year, about 96 percent are directly touched by the chemical industry. Name a sector — construction, aerospace, automotive, healthcare — and there’s a virtual certainty that chemicals are part of the production process.
What’s more, chemical companies are innovators. As an industry, they are focused on improving efficiencies, reducing their impact on the environment and developing more and better leading-edge products. In areas ranging from LEDs, solar cells and electric vehicle batteries to agriculture, nanotechnology and life sciences, the chemical industry continues to help define the directions of technological change and its impacts on the global economy of the future.
In Alabama, chemicals are the state’s second-leading export product, generating annual revenue of $2.3 billion. Most of that activity is generated in the area near Mobile, known as the MAST Chemical Corridor. “MAST” is an acronym for McIntosh, Axis, Saraland and Theodore, the municipalities along the 60-mile corridor that is home to more than 25 chemical companies. Collectively, those companies provide jobs for approximately 4,000 Alabamians — a number that has grown by 10 percent during the current decade — and combine for annual payrolls totaling about $500 million. The chemical industry’s annual impact on the Mobile regional economy exceeds $1.9 billion.
“The chemical industry is an important target for our economic development efforts,” says Amendi Stephens, a senior economic development representative for Alabama Power. “One reason for that is the quality of the jobs the industry provides. On average, employees of chemical companies in the MAST corridor earn well over twice as much as the average Alabamian. And every job created in the business of chemistry in Alabama generates 7.1 jobs elsewhere in our economy.
“Those factors alone make the chemical industry important,” Stephens adds. “But there are other factors, too. Shale gas production has more than doubled during this decade, and that unprecedented access to domestic natural gas has greatly increased the competitiveness of the American chemical industry. That has provided a big boost to the manufacturing sector, which is reflected in the continuing growth of job creation numbers and increased payrolls and tax revenues.”
The MAST Corridor offers numerous advantages for chemical companies, including direct access to the nation’s 11th-largest port and five Class 1 railroads. At nearly 1,300 miles, Alabama’s inland waterways system is the sixth-largest in the country. Along with the presence of a skilled labor force, those factors ensure that the corridor will remain a strong base of operations for the chemical industry for decades to come.
“The economic impact of the MAST Corridor is clear,” says Nick Sellers, vice president of Alabama Power’s Mobile Division. “The number of people employed by those businesses, along with the payrolls they represent, generates a tremendous multiplier effect that is felt throughout the region. The MAST Initiative can play a major role in maximizing that impact in the years ahead.”
Along with the advantages that set the stage for continued growth and expansion of the chemical industry, there are obstacles to achieving the full potential of the MAST corridor. According to a 2012 study of the corridor commissioned by Alabama Power, the most substantial obstacle is the lack of sufficient petrochemical feedstocks. That can be overcome by investing in a distribution pipeline that will introduce new feedstocks and make the MAST corridor a preferable alternative for customers now relying on facilities in the region surrounding Houston, Texas.
Completion of a pipeline will also create additional jobs through the construction or expansion of derivative facilities in the MAST corridor. Such growth would create an estimated 140,000 new jobs in Alabama, while generating an economic impact estimated at $24.5 billion.
“The opportunity is there,” Stephens says. “Our goal for continuing to grow the chemical sector in Alabama comes down to doing everything possible to ensure that prospects are aware of the opportunities and advantages of operating in the MAST Corridor. If the corridor — and Alabama’s chemical sector in general — reaches its full economic potential, it will be an engine for job growth and economic vitality for a long time to come.”
To learn more about the MAST initiative, visit mastalabama.com.