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The Lufkin/Angelina County Economic Development Analysis Prepared for:
Lufkin Economic Development Corporation The Economic Development Partnership (Strengths/Weaknesses/Opportunities/Threats
Part 1-Market Valuation and Action Plan This is the first part of the three part Market Valuation and Action Plan, which includes the identification of Strengths/Weaknesses/Opportunities/Threats in economic development terms for the City of Lufkin/Angelina County.
2010
mbarnes Mike Barnes Group, Inc.
10/11/2010
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2 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Table of Contents Preface……………………………………………………………………………………………3
Introduction……………………………………………………………………………………….5
Business Climate…………………………………………………………………………………11
Workforce/Education…………………………………………………………………………….13
Infrastructure/Sites……………………………………………………………………………….19
Quality of Life……………………………………………………………………………………21
Economic Development and Marketing…………………………………………………………22
Labor Analysis…………………………………………………………………………………...24
Observations/Findings…………………………………………………………………………...27
Conclusions………………………………………………………………………………………28
Appendix 1………………………………………………………………………………………29
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3 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Preface
In this report, Market Valuation and Action Plan, Mike Barnes Group, Inc. (MBG) has prepared
a Strengths and Weaknesses Analysis. The report includes a workforce development and labor
analysis. The analysis is designed to assess Lufkin/Angelina County, Texas, from a corporate site
selector’s perspective. MBG is a site selection/economic development provider with affiliates in
New Mexico and Indiana.
To prepare this analysis MBG has compiled information from its own databases, research from
outside sources and detailed interviews with industry in the Lufkin/Angelina County area. Those
interviews were carefully selected to draw a composite of the industry that most truly represents
the Lufkin/Angelina area's makeup.
The team at MBG has over 90 years experience in economic development and site selection. All
members of the team have been consulting with a significant number of communities over the
last ten years. Our Team started evaluating communities in 1995 and has been using the
Paragon/Fantus/site selection format. The team has used this format in hundreds of communities
from Maine to Florida to California, in almost all 48 contiguous states. This format is a very
commonly used approach.
The approach of evaluating communities based upon interviews is also one commonly used by
the top site selection professionals. Projects are won and lost based on the opinions of existing
companies and leaders in a given community. Therefore, when we rate a factor a strength or a
weakness, it is based on fieldwork, data, and on some subjectivity. This is exactly how a site
selection process takes place. Projects are frequently won and lost based on a site selection
team’s discretion in protection of their clients.
Those stakeholders interviewed include:
As part of our work in determining the competitiveness of a Lufkin/Angelina location, we
likewise conducted a number of employer interviews, combined with staffing agencies, as part of
a labor analysis. Those interview participants are listed on the following page.
Lufkin/Angelina Chamber of Commerce
City of Lufkin
Appointed
City of Lufkin
Elected
City of Lufkin
Elected
Angelina Community
College
Angelina Hardwood
Sales
City of Lufkin
Elected
Lufkin Independent
School District
Memorial Hospital
Angelina County
Angelina and Neches River
Railroad Company
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4 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Preface
The analysis generally assesses Lufkin/Angelina County’s assets and liabilities versus key
economic development criteria, including key criteria for select target industry. Economic
development criteria include:
In this assessment MBG also identifies critical issues, threats and opportunities based upon the
interviews in the community and observations from select business leaders and others in
Lufkin/Angelina County.
Finally, we will make recommendations as to specific actions that Lufkin/Angelina County
should undertake. The recommendations shall serve as a platform for future economic
development programming and directions for Lufkin/Angelina County.
Coca ColaBrookshire Brothers
Lockheed Martin
Lufkin High School
Temple Inland
Angelina College
VertisLufkin
Industries
Woodland Heights Medical
Center
Atkinson Candy
Express Staffing
Spherion Staffing
Business Climate Workforce/Education Infrastructure/Sites
Quality of LifeEconomic
Development and Marketing
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5 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Introduction
MBG conducted an economic development strength and weakness analysis for the
Lufkin/Angelina County area. First we will help you understand the most important factors by
industry sector. Next we will rate Lufkin/Angelina County against each critical factor (strength,
weakness or neutral).
Understanding the Importance of Select Factors in Corporate Site Selection
MBG has worked with many different types of companies on relocation-related projects. From
this experience we have identified the most important site location cost and condition criteria for
different types of projects. It is important to review this information, in order to better understand
why select factors are critical to the success of new locations and expansions. It will also help the
reader to better understand Lufkin/Angelina County’s potential for selected target industries, Part
2.
A full SWOT cannot be completed without a labor analysis. Some consultants will not go to the
extent of interviews in the community and do not present an adequate description of the labor
force without talking to the people on the ground. MBG has interviewed people involved in
hiring and maintaining a labor force. Therefore the SWOT can give the community a good
representation as to labor availability, labor characteristics, and the higher and secondary
education system. The SWOT does not include a full resident analysis, workforce delivery
system analysis or complete report on the schools and quality of life in the communities. The
SWOT does include what a site selection team will report on to their client after spending a few
days in the county.
We will now break down the select factors for three different areas of industry to illustrate the
differences in corporate site selection in the areas of:
Manufacturing
Administrative/Back Office
Warehouse/Distribution/Logistics
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6 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Introduction
Understanding the Importance of Select Factors in Corporate Site Selection Manufacturing
Site selection studies suggest that, in general, labor will represent the largest single annual cost
item for a typical manufacturing project. Fringe benefit costs (consisting of medical, disability,
life insurance, unemployment insurance, and workers compensation insurance) will also be
significant cost factors (often second or third). Market access is also critical and will determine
freight cost variables.
The following represent annual operating costs for two manufacturing projects, one is food
processing and the other is electronics. These are only inserted into this SWOT to help educate
the reader on the importance of the key location criteria factors. Understanding the makeup of
the key location criteria factors will later assist with the target marketing identification process
for Lea County.
Labor is the largest annual cost component in an electronics manufacturing project.
61%8%
16%
6%
4%
5%
Annual Operating Costs for a Communications Electronics Plant
Wages
Amoritized Building
Fringe Benefits
State and Federal Taxes
Local Taxes and Fees
Electric Power
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7 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Introduction
Understanding the Importance of Select Factors in Corporate Site Selection Manufacturing A food processing plant will have a much larger freight cost component.
The most critical location factors, by priority, for a typical manufacturing project:
1. Market Access (Freight Costs) 2. Labor Skills and Quality 3. Labor Costs and Fringe Benefits 4. Unionization Trends 5. Available Buildings 6. Utility Costs and Local Services 7. Business Climate/Taxation
43%
38%
11%
4% 3% 1%
Annual Operating Costs for a Food Processing Plant:
Freight Costs are Critical
Wages
Freight
Fringe Benefits
Electric Power
Amoritized Building
Taxes
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8 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Introduction
Understanding the Importance of Select Factors in Corporate Site Selection Administrative/Back Office Labor costs and conditions are even more important for an administrative back-office function.
In the sample below, wages and fringe benefits represent 90% of annual operating costs. Back
offices not only include call centers but also administrative centers that may be regional in
nature. Information technology and accounting as well as accounts payable and receivable
offices fall into this category of industry.
The most critical location factors, by priority, for a typical back-office project are:
1. Clerical Labor Costs 2. Clerical labor quality, availability 3. Turnover 4. Absenteeism 5. Occupancy costs (Class B buildings) 1 6. Training programs 7. Available buildings 8. Ability to recruit management labor (relocation & quality of life issues) 9. Proximity to commercial air service (especially for check processing centers) 1 Class B: which were the “A’s” of yesterday; now prone to some obsolescence but
still utilitarian; i.e., older, slower elevators; large columns; older HVAC systems;
smaller floor-plates; etc. (reference: SIOR) ( K Mart buildings fit this category)
72%
18%
5% 4%
0.9% 0.1%
Annual Operating Costs for Administrative/Back Office Operation:
Labor Costs Dominate
Labor
Fringe Benefits
Amortized Building
Property Taxes
Corporate Taxes
Electric Power
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9 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Introduction
Understanding the Importance of Select Factors in Corporate Site Selection Warehouse/Distribution
The most critical location factors, by priority, for a typical warehouse/distribution project
are: Labor cost, quality & availability
1. Freight costs/market access 2. Service delivery time (access to market) 2 3. Interstate highway access (four directions considered most desirable) 4. Available buildings (minimum 80,000 to 120,000 sq.ft; 20-24 foot ceilings
2Especially seasonal workers for seasonal products which fluctuate in quantities.
49%
35%
10%6%
Annual Operating Costs: Wharehouse/Distribution Plant
freight costs
labor
amortized building
taxes
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10 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Introduction
The Market Valuation and Action Plan for Lufkin/Angelina County will provide three reports. .
This report, Report 1-Consultant Report of the Findings of the SWOT and Labor Analysis will
address the competitiveness. The second report, The Targets, will include the targeted
industries. The marketing strategy aimed at prospect development from within the “targets,” will
be the third report. Various organizational analysis observations and suggestions will be made in
all facets of the reports.
The Project’s intended results are as follows:
Thorough understanding of Lufkin/Angelina
County's Strenghts and Challenges
Active Participation from stakeholders
and employers from within
Lufkin/Angelina County
Action with Marketing Plan and
Marketing Effort
Countywide support for a unified
economic development effort
A business community engaged
in economic development
Implement Quickly
Lufkin/Angelina SWOT Report
Submitted by October 22, 2010
Lufking/Angelina Targeted Industries
Report Submitted by
November 15,2010
Lufkin/Angelina Marketing Plan Submitted by
November 30, 2010
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11 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
The following table represents the private employment by industry sector in Angelina County for
the fourth quarter, 2009, reflecting wages and fluctuations from the previous year. As we discuss
the business climate in the following pages, it is helpful to have an understanding of the types of
businesses that provide the major sources of private employment.
Back To State
Angelina County
Industry supersector data table, private ownership
Supersector Number of
establishments, Dec 2009p
Employment, Dec 2009p
12 month percent
change in employment,
Dec 2008-Dec 2009p
12 month change in
employment, Dec 2008-Dec 2009p
Average weekly wage, Dec
2009p
12 month percent change
in average weekly wage, Dec
2008-Dec
2009p
12 month change
in average weekly wage, Dec
2008-Dec
2009p
Construction 152 1,381 -20.8% -362 $739 2.9% $21
Education and Health Services 257 7,166 -0.5% -38 $705 4.1% $28
Financial Activities 201 1,264 -2.8% -37 $771 0.1% $1
Information 27 484 -4.9% -25 $975 -4.5% $-46
Leisure and Hospitality 139 2,967 -3.8% -117 $276 0.4% $1
Manufacturing 80 4,190 -23.0% -1,255 $1,161 15.3% $154
Natural Resources and Mining 54 403 -23.1% -121 $1,024 1.9% $19
Other Services 140 700 -3.6% -26 $448 -3.7% $-17
Professional and Business Services
239 2,494 -4.0% -105 $973 4.1% $38
Trade, Transportation, and Utilities
452 6,428 -3.6% -241 $600 1.7% $10
Source: Bureau of Labor Statistics, 2010
Business Climate
http://beta.bls.gov/maps/cew/TX?period=2009-Q4&industry=10&geo_id=48000&chartData=2&distribution=Quantiles&pos_color=blue&neg_color=orange&showHideChart=hide
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12 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Business Climate
Business Climate
As evidenced by the chart above, stakeholders found the Business Climate in Lufkin/Angelina to
be very positive. Attempts were made to identify those weaknesses; however, the only weakness
cited was potential permitting issues with regard to obtaining building permits. This is an
outstanding indicator of a positive business climate.
Strengths
All Elements of the Community Work Together
Pro Growth Attitude
Incentives in Place and Willingness to Implement
Texas is Strong Business State
Available Land
Engaged Community and EDC
Community Appears Larger than Population
Medical Facilities Present Suggest Regional Hub
Regional Retail/Service Hub
Weaknesses
Opportunities
EDC Can Positively Impact Business Climate
Ongoing Success Will Create More Opportunities
Potential Discussion of Air Service to Lufkin
Enhanced Community College/SFA/Local School Districts Colloborative Efforts Will Create More
Business Opportunities
More Connectivity to Southeast Texas' Ports
Threats
Lack of Interstate HIghway (Perception)
"Perception of Piney Woods Curtain"
Lack of "Brand or Image" in Marketplace
Lack of Targeted/Focused Economic Development Marketing Program
Potential for Building Permit Issues
Business Climate
Business Climate
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13 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Lufkin/Angelina County is fortunate to have, within its boundaries, Angelina College. This
community college plays a major role in the business attraction/retention effort by its ability to
provide training for employers as they locate or expand. In addition, the close proximity to
Stephen F. Austin University in nearby Nacogdoches provides outstanding linkage to a four year
(+) institution of higher education.
A total of six school districts exist within Angelina County. In the following charts, we can
identify certain performance assessments within these districts.
16 16.5 17 17.5 18 18.5 19 19.5 20 20.5
Lufkin ISD
Central
Diboll
Hudson
Huntington
Zavalla
17.5
17.6
17.8
19.2
20.3
19
Source: TEA 2008 Data
Average ACT Scores by District
Workforce/Education
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14 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
800 850 900 950 1000 1050 1100 1150 1200
Lufkin ISD
Central
Diboll
Hudson
Huntington
Zavalla
980
1033
980
970
990
1015
Source: TEA 2008 Data
Average SAT Scores By District
50% 55% 60% 65% 70% 75% 80% 85% 90% 95%
State …
Zavalla ISD
Huntingto…
Hudson ISD
Diboll ISD
Central ISD
Lufkin ISD
82%
71%
84%
93%
83%
88%
86%
78%
72%
79%
90%
77%
80%
79%
Source: TEA 2008-09
Percentage of Students Meeting Accountability Standards
Science Mathematics
Workforce/Education
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15 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
91%93%
94%89%
92%
89%96%
96%
93%
86% 94%
95%
92%97%
50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
Source: TEA, 2008-2009
Lufkin ISD
Central ISD
Diboll ISD
Hudson ISD
Huntington ISD
Zavalla ISD
State Average
Percentages of Students Making Accountability Standards
Reading/Eng Lang Arts Writing
$4,319
$4,422
$3,857
$3,785
$3,768
$3,943
$3,730
$2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000
source: TEA, 2008-2009
Lufkin ISD
Central ISD
Diboll ISD
Hudson ISD
Huntington ISD
Zavalla ISD
State Average
Instructional Expenditures per Pupil (Actual 2008-09)
Workforce/Education
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16 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Please note the charts on the following pages for specific data relative to Angelina County in
terms of it education, poverty and related earnings.
Angelina County, Texas
Subject Total
Margin of Error Male
Margin of Error Female
Margin of Error
Population 18 to 24 years 7,654 +/-197 3,836 +/-66 3,818 +/-188
Less than high school graduate 21.7% +/-5.6 27.9% +/-7.7 15.6% +/-5.2
High school graduate (includes equivalency) 43.8% +/-5.8 48.0% +/-7.3 39.7% +/-8.6
Some college or associate's degree 33.0% +/-5.8 23.6% +/-7.7 42.4% +/-8.0
Bachelor's degree or higher 1.4% +/-1.2 0.5% +/-0.8 2.4% +/-2.3
Population 25 years and over 52,809 +/-223 25,489 +/-141 27,320 +/-214
Less than 9th grade 9.6% +/-1.2 10.5% +/-1.7 8.7% +/-1.4
9th to 12th grade, no diploma 13.4% +/-1.5 12.7% +/-2.1 14.1% +/-2.3
High school graduate (includes equivalency) 30.9% +/-2.4 32.1% +/-2.9 29.9% +/-3.2
Some college, no degree 23.4% +/-1.8 22.5% +/-2.4 24.2% +/-2.8
Associate's degree 6.8% +/-1.3 7.4% +/-1.9 6.3% +/-1.4
Bachelor's degree 11.3% +/-1.6 11.3% +/-2.0 11.3% +/-2.0
Graduate or professional degree 4.6% +/-0.9 3.6% +/-0.9 5.6% +/-1.5
Percent high school graduate or higher 77.1% +/-1.9 76.9% +/-2.4 77.2% +/-2.7
Percent bachelor's degree or higher 15.9% +/-2.0 14.9% +/-2.2 16.9% +/-2.5
Population 25 to 34 years 11,031 +/-339 5,865 +/-233 5,166 +/-262
High school graduate or higher 77.7% +/-5.3 79.3% +/-5.3 75.8% +/-7.4
Bachelor's degree or higher 14.2% +/-5.5 9.6% +/-5.1 19.4% +/-7.5
Population 35 to 44 years 11,077 +/-302 5,567 +/-270 5,510 +/-194
High school graduate or higher 80.2% +/-3.9 77.5% +/-6.2 82.9% +/-4.7
Bachelor's degree or higher 16.1% +/-3.3 12.7% +/-3.8 19.5% +/-5.1
Population 45 to 64 years 19,241 +/-274 9,274 +/-260 9,967 +/-105
High school graduate or higher 80.1% +/-2.6 78.5% +/-4.1 81.7% +/-3.6
Bachelor's degree or higher 16.6% +/-3.0 15.7% +/-3.7 17.5% +/-4.0
Population 65 years and over 11,460 +/-181 4,783 +/-165 6,677 +/-99
High school graduate or higher 68.2% +/-3.7 70.0% +/-5.2 67.0% +/-4.9
Bachelor's degree or higher 16.1% +/-3.2 22.2% +/-5.2 11.8% +/-3.0
Data Set: 2006-2008 American Community Survey 3-Year Estimates, U. S. Census Bureau, American Community Survey
Workforce/Education
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17 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Angelina County, Texas
POVERTY RATE FOR THE POPULATION 25 YEARS AND OVER FOR WHOM POVERTY STATUS IS DETERMINED BY EDUCATIONAL ATTAINMENT LEVEL
Less than high school graduate 23.6% +/-4.5 15.9% +/-6.0 30.3% +/-5.7
High school graduate (includes equivalency) 13.0% +/-3.2 11.1% +/-3.5 14.9% +/-4.2
Some college or associate's degree 10.9% +/-3.2 9.9% +/-4.1 11.8% +/-4.0
Bachelor's degree 4.8% +/-3.4 0.0% +/-2.2 9.2% +/-6.2
Graduate or professional degree 2.0% +/-2.2 4.6% +/-5.8 0.5% +/-1.0
MEDIAN EARNINGS IN THE PAST 12 MONTHS (IN 2008 INFLATION-ADJUSTED DOLLARS)
Population 25 years and over with earnings 27,470 +/-1,852 31,412 +/-2,155 21,588 +/-2,635
Less than high school graduate 17,365 +/-2,329 20,536 +/-3,115 13,665 +/-1,918
High school graduate (includes equivalency) 21,775 +/-1,964 26,628 +/-3,092 15,859 +/-3,006
Some college or associate's degree 30,654 +/-1,339 36,384 +/-2,851 25,558 +/-3,455
Bachelor's degree 44,364 +/-5,757 63,656 +/-13,421 36,809 +/-4,353
Graduate or professional degree 49,487 +/-6,705 70,652 +/-11,842 46,032 +/-6,277
PERCENT IMPUTED
Educational attainment 3.3% (X) (X) (X) (X) (X)
Data Set: 2006-2008 American Community Survey 3-Year Estimates, U. S. Census Bureau, American Community Survey
Evaluating Workforce and Education in Lufkin/Angelina is not an easy task. It is widely held
that the schools are doing a very good job, which is reflected in the “Recognized” ratings of the
six districts. In the section that addresses the labor analysis, more direct negatives were observed
than by those stakeholders. This might suggest that a perception gap exists between those at the
policy level and those engaged daily in manufacturing or service businesses. Education is
uniformly considered a high priority and that is certainly a plus!
Workforce/Education
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18 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Strengths
All 6 Districts are "Recognized"
Outstanding Relationship Between Community and Angelina College
Magnet Schools Receive High Marks
Higher Skills Present in the Workforce
Training for Needed Skills Availablle
Workforce Commutes from Within Region
Business and WIB Work Well
Pilot Project (s) Get Workers Ramped Quickly
(Nursing is Example)
Weaknesses
Lack of Quality Customer Service Training
Lack of Integration in Business Community with Pre-K--12
Soft Skills Need Improvement
Large Pool of Experienced Workers not Available
Tradition of Heavy Industry Orientation While Economy Shifts
Perception of the PIne Forest Curtain in Terms of Education/Workforce
Opportunities
More Regional Approaches to Education--Get 6 Districts on Same Page
More Integration Between All Education and Business Community
More Integration With Stephen F, Austin
Consideration of Career Academy
Recognize Changing Economy and Have Education/Workforce to Meet the Change
Continue Efforts from Manufacturing to Imagineering
Threats
Lack of Understanding and Meeting the Needs of a Changing Economy in Workforce and Education
Not Recognizing New Measurements for Success in a Regional Economy
Continuation of the "Sawmill Mentality"
Workforce/Education
Workforce/Education
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19 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Lufkin/Angelina is strategically located in East Texas. Its proximity to Houston (less than two
hours), serves as an asset in terms of its access to “Hub Air Service” Likewise, its proximity
limits the ability to obtain commercial air service in Lufkin/Angelina. Neighboring Tyler, Texas
enjoys a commuter commercial service. Highway access is primarily provided by Highways 59
and 69, with convenient loops carrying traffic inside the city. Although there is not an interstate
highway located within Lufkin/Angelina, commercial truck and other vehicular traffic are
heavily present in and around the city. This infrastructure throughtout Lufkin/Angelina is quite
adequate for the transportation of goods and the provision of services. This is evidenced by the
number of businesses/industries present throughout the county.
Highway Map Showing Highways 59 and 69 serving Lufkin/Angelina County
Infrastructure/Sites/Buildings
http://www.city-data.com/city/Lufkin-Texas.html
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20 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
In the discussions with the community’s stakeholders, it was apparent that
Infrastructure/Sites/Buildings were perceived as a major strength in the region. Research
conducted by the Consultant Team confirms this observation. In Appendix 1, we have offered
suggestions as to the specific types of information that should be present on the site/building
section of the website.
Strengths
Excess Capacities in Water/Sewer
Newly developed "Large Rail Site"
New Industrial Park(s)
Reasonable Inventory of Quality Buildings
Good Highway Access Inter-City and Intra City
AvailableLand Within and Outside of EDC Control
of Varying Size/Locations
Close Proximity to Houston Air Hub
Enhanced Appearance of HIghways
Weaknesses
Lack of Interstate
Lack of Commercial Air Service
Opportunities
Consideration of Local/Regional Commercial Air Service
Enhanced Public/Private Partnerships to Provide Sites/Buildings to End Users--
Risk/Entrepreneurial
Create Locations for "Changing Economy" Business/Industry
Threats
Perception of Lack of Business/Industrial Locations Within the "Pine Curtain"
Lack of Willingness to Continue Development of Sites
Infrastructure/Sites and Buildings
Infrastructure/Sites/Buildings
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21 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
One of the first impressions one has when coming to Lufkin is that it is a city whose population
is much larger than the U.S. Census indicates. That impression is due largely to the abundance
of retail, restaurants and shopping, cultural amenities such as the Temple Performing Arts
Center, parks--including the zoo, Angelina College, outstanding golf courses and the
configuration and beautification of the recent transportation improvements.
When compared to other similarly sized communities, Lufkin/Angelina appears to have
tremendous quality of life options. Whether it is a performance of Roberta Flack, touring
theater productions, agricultural-related activities, sports activities both as spectators and
participants, outstanding parks, abundant civic and religious options, and the ability to take
advantage of a number of ongoing events, Lufkin/Angelina is well equipped with quality of
life activities.
Quality of Life
Strengths
"Gem of the Region"
Medical Regional Hub
Regional Retail/Restaurant Hub
Great Parks/Zoo
Outdoor Recreation is Superb
Outstanding Golf Courses
Foundations Provide Funding
Angelina College is Major Asset to QoL
Abundance of "New" Motels
Weaknesses
Concern for Young Professionals Finding Lufkin Adequate for Their Needs
Outmigration of Youth to Larger Cities
Opportunities
Additional Tourism Marketing Could Lure New Firms
Further Engagement with Angelina College and Other Educational Resources
Market Quality of LIfe as Part of EDC Inventory
Continuing Beautification Effort(s)
Enhance Downtown Appearance
Threats
Lack of Engagement of Public on Beautification Issues
Lack of Focus on Downtown
Poor Attendance at Some Venues Could Cause Apathy
Quality of Life
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22 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Economic Development in Lufkin/Angelina enjoys significant public-private partnership.
Through the Lufkin Economic Development Corporation, elected city officials participate
directly or through appointment in establishing the policy for the City’s economic development
effort. Utilizing the sales tax legislation, this organization has a budget that enables staff to focus
on economic development and not fundraising. In addition, the private sector participation
through the Angelina Partnership provides private business leadership a vehicle to positively
impact the area’s economic development effort. The Consultant Team found the relationship
between these two organizations to be beneficial and contributory. The cross-pollination of
direction from all facets of leadership within the city/county contributes positively to the ongoing
economic development effort.
The above-named organizations are staffed professionally by a staff of two. The Consultant
Team found widespread support for the activities of the staff while researching this subject.
Staff is well respected, not only in Lufkin/Angelina, but by peers throughout Texas. The day-to-
day operations of an economic development agency require creative, adaptive, and
knowledgeable professionals. From the feedback provided the Consultant Team,
Lufkin/Angelina more than satisfies this requirement through its economic development staffing.
Strengths
Quality Leadership at Policy and Staff Levels
Considerable Improvement Over Previous Years
Community has the Ingredients
Have Funds for "Closing the Deal"
Underway with New/Higher Level Jobs
Weaknesses
Lack of National Image
No Plan in Place
"Scattershoot vs. Target"
Outside the "Houston Commute Pattern"
Opportunities
Examine Regional Linkages for ED
Create even more "deal closing" approaches
Increase Marketing to Targets from Strategy
Develop Relationships with Corporate Decision Makers
Become More Engaged in Marketing Functions Nationally
Threats
Apathy
Inadequate Number of Staff for Enhanced E.D. Activities
Sales Tax Revenue Decreasing
Lack of "Risk Taking" in E.D. Projects
Lack of Understanding of E.D. by Larger Community
Economic Development and Marketing
Economic Development
and Marketing
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23 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
The Lufkin EDC/Angelina Partnership engages in a number of marketing activities. It currently
possesses a very attractive website and collateral pieces that provide specific information. In
addition, the economic development group is a member of Team Texas/Texas One, which
enhances the visibility of Lufkin/Angelina not only within the State of Texas but to outside
corporate interests. In Part 3 of this report, recommendations will be made relative to the more
specific marketing activities that should be undertaken.
One of the “missing components” is the Business Retention/Expansion Program (BREP). This is
not to state that the staff does not recognize its importance; rather, there is little time for staff to
engage in this program activity. It would be “routine” for an organization this size to conduct at
least one formal BREP visit each week. This would provide a total of over 50 visits annually,
which appears quite impressive. Given time constraints and staff (size) limitations; it is easy to
see this component not receiving the attention it deserves. Most BREP visits are currently
limited to those firms which are experiencing growth or difficulty.
Economic Development and
Marketing
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24 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
This portion of the Market Valuation addresses labor and the perspectives of those existing
businesses within the community. The Consultant Team conducted interviews with a number of
firms (See p.4) and compiled their responses in chart form. The following represent the
responses from the existing businesses/industries interviewed on October 4-5, 2010.
9.00
7.45
7.73
5.82
6.22
5.29
5.86
0.00 2.00 4.00 6.00 8.00 10.00
Index: 1= very poor; 5 = very poor; 10 = excellent
Engineering
Management
Technical
Skilled
Semiskilled
Unskilled
Clerical
Labor Availability Ratings: Lufkin
7.78
8.11
8.78
8.11
7.89
7.89
8.22
8.56
8.00
0.00 2.00 4.00 6.00 8.00 10.00
Index: 1= very poor; 5= avg.; 10 = excellent
Turnover
Absenteeism
Attitudes
Trainability
Basic Skills
Communications
Alcohol/Drugs
Labor Productivity
Accuracy
Labor Characteristics Ratings: Lufkin
Labor Analysis
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25 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
7.11
9.00
7.00
8.33
9.67
9.56
8.56
8.44
7.89
8.44
0.00 2.00 4.00 6.00 8.00 10.00
Index: 1= very poor; 5= avg.; 10 = excellent
Water
Sewer
Electric
Telecom
Police
Fire
Rail
Permitting
Highway/Roads
Air Service
Quality of Services Ratings: Lufkin
8.11
8.11
7.44
7.78
7.78
5.56
9.11
8.56
7.61
0.00 2.00 4.00 6.00 8.00 10.00
Index: 1= very poor; 5 = avg.; 10 = excellent
Public Schools
Medical Services
Housing: owner occupied
Housing: rental
Day Care
Zoning
Community Attractiveness
Recreation
Cultural Facilities
Quality of Life Ratings: Lufkin
Labor Analysis
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26 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
The leadership (business community and elected/appointed governmental officials) in Lufkin/Angelina County is desirous of successful economic development. The challenge
lies in the approach and implementation. The following questions need to be addressed:
1. Will the leadership be unified in the provision of incentives? Will the Lufkin EDC/Angelina Partnership be willing to become more risk takers or
entrepreneurial in their approaches?
2. Will the leadership recognize the need for additional funding for staff and other resources to provide needed services in the following categories:
1) Business Retention/Expansion Program integrated into the ongoing comprehensive economic development program
2) Enhanced marketing which will require key staff to be away from the community for extended periods of time, thus needing staff to maintain
ongoing presence in the community (Discussed in detail in Part 3)
3. Will the leadership maintain patience while the expanded economic development program gets underway? Will there be a demand for “immediate success?”
4. Will the leadership continue to recognize the demographics of the community are changing as reflected in the schools, workplace/workforce, and business? Will
there continue to be this impressive focus on all components of the community
working together to enhance education/workforce and the overall standards and
quality of life?
Strengths and opportunities far outweigh the weaknesses and threats! 1. Available land with infrastructure in place or the ability to put in place timely. 2. Outstanding workforce training through collaborative efforts of the local WIB, pre-
K educational facilities, and Angelina College currently exists.
3. Although the county is not located on an interstate, access to/from and within Lufkin/Angelina is outstanding. Access to the numerous ports to the south could
play a key role in the future.
4. Retailers, restaurateurs, and motel operators have observed the “expanded or regional” population base in the community. Tremendous opportunity exists to
translate that into business/industrial locations/expansions.
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27 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
5. Both the Business Climate and Quality of Life are well above average—the challenge is to design components of the economic development program to
incorporate each of these attributes.
6. There may be more opportunities to “connect to Nacogdoches” in terms of utilizing the proximity of Stephen F. Austin from a regional economic
development marketing effort.
7. Any marketing campaign that is undertaken must involve both internal and external components. There must be continued community-wide support for a
comprehensive economic development effort.
8. The community “understands” business/industry and has a successful tradition of accommodating both. This understanding should be emphasized in upcoming
marketing campaigns.
9. Stakeholders recognize the “Changing Economy” and the upcoming targets and marketing campaign must similarly recognize this shift. (This challenge will be
addressed by the Consultant Team.) This will aid in the diversification of the
community’s economic base.
10. Consideration of identifying expanded air service as a goal should occur. At a minimum, further exploration of multi-modal transportation opportunities is a
must, given the expanding ports to the south.
ObservationsFindings
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28 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Conclusions
Strengths Business Climate
Workforce /Education
Sites/Infrastructure/Buildings
Quality of Life
Economic Development and Marketing
Weaknesses Workforce/Education (From Employer
Dialogue)
Opportunities Economic Development and Marketing
Workforce/Education (Future
Opportunities)
Threats Business Climate (Apathy)
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29 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Appendix 1 Appendix 1: Review of Sites and buildings in the Lufkin area.
Upon initial review, there are weaknesses in the database concerning information on available
buildings and sites found in the Lufkin website. The primary weaknesses found are all data
related. There is no information concerning available or future utilities attached to any of the
sites or facilities. This is information that is critical for both site selectors and business/industry
in determining whether they will consider a potential site or facility for a location. Additionally,
there is very little information concerning lease or purchase options and associated costs, so that
appropriate initial cost comparisons can be calculated.
A remedy that should be considered is the use of the Site Selection Standards that were
established by IEDC a number of years ago. While they were never formally adopted they are
still the best accumulation of desired data that has been put together. These data standards can
be found in their entirety on the IEDC Website www.iedconline.org.
Companies and Site Selection Professionals do a majority of their initial searches over the
Internet. Thus an organization must provide as much detail as is possible to keep your
community and products (Buildings and Sites) from being rejected before you get a chance to
have a conversation with the potential client. Lufkin is no exception; an example of additional
information needs for an existing building such as the Shell Building would be to include a
number of potential details. While the information included on the webpage includes key
elements such as zoning, acreage, rail access and provider, building type, overall square footage,
column spacing, year built, construction type and ceiling height more information is needed to
answer critical questions as to whether the building will work for a particular client.
The proposed floor thickness of a standard building would be an important piece of information.
Also is the ceiling height to the joist or the height of the building itself. The number of truck
docks and type would also be important to include as well as the potential number of rail doors.
There should also be a building layout with placement of columns, docks, and doors with
potential locations of utility entrances. More critical elements are what utilities are to the
building and which need to be extended, the time needed to extend to building, the size (volume)
of service, the service provider, and generic costs for service including any additional fees and
charges. As noted on the data sheet of the Shell Building, both the sprinkler system and
overhead cranes are engineered for the building. It would be important to include the type of
sprinkler system envisioned (wet or dry) or required for the building, and the maximum tonnage
capacity for the proposed crane that could be installed. Lastly, there needs to be included the fire
insurance rating for the structure, the proposed tax levy on the facility and an approximate cost
for purchase or lease as is. By having this information for all of your facilities, the client will be
able to conduct a more efficient search and thus have a better feel for the community.
An example of the needs for an Industrial site is quite similar to that of a building. However
there are a few additions for a site. An example in Lufkin would be the Lufkin
http://www.iedconline.org/
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30 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Business Park. The information currently listed includes Zoning, Incentive Zones, Size, Rail
Access and Provider, Environmental Condition and site type and location. Additional data
needed to entice a potential client would be a topographical and aerial map showing elevations
(preferably 2 ft. contours), the proposed platting for the whole property and potential ingress and
egress points. Also identify the locations for potential roadways and water drainage, including
retention basins and flowage easements. Size/volume, location, service provider and extension
time lines for servicing the site with all utilities. Also include a listing of utility service rates and
other fees required of a user as well as the tax rate on the property itself. Include the cost per
acre or per square foot of the property so that the client can run their numbers for the overall cost
of the project.
By providing this type of detail you will not only be assisting potential clients with pertinent
data, but will also be saving yourself valuable time in dealing with clients that have no intention
of locating in a facility or site that does not meet their respective needs. Another thing to
consider is how current is the information on your Sites and Building Webpage. Are the
properties still available, is the price still the same, have any of the other data changed about the
properties. This is one of the largest problems experienced by site selection professionals today,
making sure that the information provided is current and accurate. The more you do to assure
the accuracy of your information the more leads will be drawn to your location.
Following is a partial list of needs as identified to be used in the Buildings and site section of the
Lufkin Website as well as basic database:
Building Information
Square Foot Dimensions
Ceiling Heights Under Joist
Sprinkler System
Dry/Wet
Size/Capacity/Rating
Column Spacing
Floor Thickness/Weight Capacity
Loading Docks
Number
Type
Zoning
Environmental Study
Construction Type
Age of Facility
Previous Use
Ingress/Egress
Site Topography
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31 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Transportation
Highway
Rail
Barge/Port
Airport
Utilities
Electricity
Service to Facility
Service Provider
Costs of Hook-up and Processing
Dual/Single Feed
Interior Service
Natural Gas
Size/Pressure of Service
Service Provider
Costs of Hook-up and Processing
Distance to service
BTU Value
Water
Size of Service
Line Size
Pressure of Service
Service Provider
Costs of Hook-up and Processing
Rated Capacity
Peak Demand
Sewer
Size of Main
Service Provider
Costs of Hook-up and Processing
Treatment Plant Capacity
Peak Demand
Pre-treatment requirements
Telecommunications
Current Service provider
Type of Switch
Points of Presence (POPs)
Costs of Hook-up and Processing
Fiber Availability
Fire insurance Rating
Taxes/Fees on Facility
Lease/Purchase Prices
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32 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
Site Information
Acreage
Site Plat/Boundaries
Topography
Soil Bearings
Aerial Photography of Site
Elevation (Flood Zone)
% Wetlands
Environmental (Min. Phase 1)
Price per Acre
Transportation
Highway
Rail
Barge/Port
Airport
Zoning
Utilities
Electricity
Size/Type of Service to Site
Service Provider
Dual/Single Feed
Rates
Natural Gas
Size/Pressure of Service to Site
Service Provider
Rates
Water
Size/Pressure of Service to Site
Service Provider
Extension and Service Costs to Site
Capacity of System
Sewer
Size of Service to Site
Service Provider
Hook-up and Extension Requirements
Costs associated with Hook-ups and Processing
Telecommunications
Current Service provider
Type of Switch
Points of Presence (POPs)
Costs of Hook-up and Processing
Fiber Availability
Fire Insurance Rating
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33 Lufkin/Angelina Partnership Market Valuation and Action Plan, Part 1
Submitted by the Mike Barnes Group
These are the more critical types of information that needs to be easily accessible by a potential
client when they are looking for a potential location. This data should be available on all
properties included in the Lufkin Site and Building Database. Additionally, there also needs to
be as many photographs of the Sites and Buildings from multiple angles inside and out. This
allows the potential client to better determine which facility or site meet their initial criteria.
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1 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 Prepared for the: Lufkin Economic Development Corporation The Economic Development Partnership
Part 2-Market Valuation and Action Plan Targeted Industries This is the second part of the three part Market Valuation and Action Plan, which includes the identification of Targeted Industries in economic development terms for the City of Lufkin/Angelina County.
2010
Submitted by the Mike Barnes Group, Inc.
11/15/2010
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2 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
Table of Contents
Preface………………………………………………………………………………….......................3
Introduction………………………………………………………………..…………………………4 Targeted Industries and Businesses………………………………………………………5 Appendix 1…………………………………………………………………………………………….9 Appendix 2……………………………………………………………………………..……………25 Appendix 3…………………………………………………………………………………………..66
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 3
Submitted by the Mike Barnes Group, Inc.
Preface
The Strategic Plan is the second document in a series of economic development documents
presented to Lufkin/Angelina County. The first document, the SWOT was developed from
interviews and research conducted by the Mike Barnes Group during October and November
2010. The second document, entitled, Report 2-Targeted Industries represents findings derived
from the aforementioned interviews, additional interviews and on-site inspections of educational
and training facilities located in Lufkin and Nacogdoches. The Strategic Plan will incorporate
the findings of those earlier documents and research, coupled with the recommendations of the
Consultant Team. The Consultant Team has executive level economic development experience
that totals more than ninety years. Two members of the Consultant Team possess advanced
degrees. In addition, the MBG has an extensive database derived from both community
economic development work and site selection/incentive negotiation projects.
The Strategic Plan will identify potential targeted industries and businesses for the Lufkin
EDC/Angelina Partnership. In addition, it will provide a Marketing Plan that can easily be
implemented. Finally, the Strategic Plan will provide an organizational analysis of the economic
development organization(s). The MBG appreciates the hard work and dedication of all those
persons identified in Report 1 and 2 in helping this project come to fruition. MBG acknowledges
the specific effort of the staff of the Lufkin EDC/Angelina Partnership in providing logistics,
establishing appointments, answering numerous inquiries, and the hospitality throughout this
project.
The Consultant Team of the Mike Barnes Group included the firm’s President/CEO, Michael
Barnes, from Blanco, Texas, Senior Associate, Jack Allston of JBA and Associates from Rio
Rancho, New Mexico and James Kinnett of TKCG from Lawrenceburg, Indiana. Similarly, we
appreciate the assistance from Angelina College and Stephen F. Austin in providing additional
insight into the research portion of this project.
To suggest that the Lufkin EDC/Angelina Partnership has been anything but successful in its
economic development endeavors would be inaccurate. The goal of this process is to further
enhance the ability of Lufkin/Angelina County to be competitive in the global marketplace. It
has been estimated that at least 10,000 organizations such as the Lufkin EDC/Angelina
Partnership compete with one another for the obviously limited economic development projects.
This speaks volumes in terms of the recent success of the Lufkin EDC/Angelina Partnership!
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4 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
Introduction
Lufkin/Angelina County possesses major attributes in terms of economic development
competitiveness. As is the case with most areas, there are barriers to its being more competitive.
The Strategy the Consultant Team is recommending recognizes this situation. Of significant
importance is the ―market orientation‖ of the MBG approach. Rather than a theoretical
document, the Strategy puts into place proven economic development practices.
In identifying targets, MBG recognized the importance and contribution of Lufkin/Angelina
County’s existing industry. Likewise, the targets were developed with a keen recognition of the
area workforce—existing and potential. The Consultant Team was cognizant of recent success
in the aviation-related industry. Simultaneously, a push to help diversify the economy and
enhance the future opportunities for residents was made with identified targets that offered subtle
modifications to the existing industrial base and the accompanying workforce.
Having identified targets also is a valuable asset when establishing a marketing plan. Any
marketing strategy must be given time. Too many economic development organizations shift
their focus and strategy prematurely. Economic development is rarely instantaneous. Typically,
the process takes a matter of months, or in many cases, years. Evaluation of the marketing plan
should be ongoing and modifications reflective of the marketplace made.
Perhaps the easiest component of this three phased report is that of Organizational Analysis.
Candidly, the Lufkin EDC appears to be well organized and funded. Staffing could be an issue
that will be addressed in the next phase, as we address the marketing component. This
contributes significantly to the successful economic development effort. There will be some
observations/recommendations suggesting perhaps other approaches and identifying minor
modifications to enhance the organization. On balance, Lufkin EDC/Angelina Partnership
should be very proud of the accomplishments of its economic development organization and
staff.
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 5
Submitted by the Mike Barnes Group, Inc.
Targeted Industries and Businesses
Selecting target industries for Lufkin/Angelina County is a multi-step process. In Report 1,
Results of the SWOT, we identified the area’s strengths and weaknesses as a location for
business growth. From this, we employ a ―site selection‖ methodology that seeks to answer the
following four questions:
1. Are there local assets that give specific industries a competitive edge? What clusters currently exist locally, and are they growing? Immediate and obvious
candidates for targets are those that are experiencing growth within the community or
surrounding communities. Industries that have a large presence but lack growth suggest
that the county is losing its competitiveness in this industry. While the industry may be a
candidate to target for a retention effort, a long-term decline calls for a close look at
transitional opportunities into new industries that create jobs (e.g. textile workers
transitioning into food processing).
2. Are existing or emerging local clusters growing nationally or undergoing geographic dislocation? For those local clusters that have potential, are they growing
nationally as well? While some industries are experiencing high growth rates, most U.S.
industries are modest or stagnant in their growth. However, the dislocation of industries
from one part of the country to another has been a longstanding opportunity for
recruitment. Many industries undergo restructuring in order to be more competitive or
simply suffer a high rate of startup and failure.
3. Communities are as unique as people. Each one has strengths that companies can leverage to create competitive advantages. These strengths can include such things as
workforce skills, tax structure, infrastructure, and market proximity. Likewise, many
companies have specific infrastructure and workforce minimum requirements, and
understanding whether the region can meet those requirements is crucial. For example, if
the region lacks water and wastewater capacity or has overly stringent environmental
regulations, then the community could be ruled out for food processing and
semiconductor manufacturing. Understanding the needs of target companies is essential
to recruiting them.
4. Does the industry match community goals? The most important criterion is often whether or not the industry matches the stated goals of the community. Some
communities may want to avoid manufacturing businesses or businesses that don’t pay
high enough wages. Sometimes lack of available land requires a more precise list of
targets. Communities wanting to maintain a small-town appeal, for example, may target
homegrown ―soft‖ industries. Others wanting to transition into a more urban,
metropolitan setting may focus more on larger office users.
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6 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
Targeted Industries and Businesses
―Site selection‖ is a broad term that describes a company’s process of selecting a city for a new
office or the relocation of existing divisions. This process involves executives from several
divisions within the company (such as Executive, Human Resources, Facilities Planning, and
sometimes Marketing) and often involves a consultant or real estate broker. Site selection is not a
scientific process, but does involve a system of measurements and calculations, many of which
are subjective to the company.
Traditionally, the growth of economies has been described in terms of a region’s ―basic‖ or
―primary‖ industries. These industries typically export their goods or services outside the region,
thereby supporting local industries such as retail, housing construction, and personal services
through its payroll and local purchases. Primary industries reflect an injection of outside money
into the community and have a high economic impact; according to various economic impact
analyses, a typical primary business may create two additional jobs in the local economy for
every one job at its facility. For this reason, communities across the country compete to recruit
or retain these high-impact, primary businesses.
Manufacturing is a good example of a primary industry, as most customers would be found
throughout the U.S. or even internationally. With the manufacturing industry in decline and the
increasingly global nature of business today, many more industries are increasingly ―primary‖ in
their make-up: distribution centers may serve a multi-state region; back office operations can
serve a company’s global network of employees; and custom software companies can
build Internet applications that serve businesses anywhere in the world. Federal installations such
as army bases or federal research labs are clear examples of how government can be classified as
a primary industry. High wage jobs are usually found at national or global companies that are
enjoying growth.
While businesses are more global in nature today, rapid gains in technology,
telecommunications, and markets continue to alter the location requirements of many companies.
Often the speed of business drives corporate location decisions. Research conducted by the
Industrial Asset Management Council suggests that the competition for top talent is now viewed
to be the most important component of a successful company. Today’s business environment
requires that businesses continue to upgrade their technological capabilities while expanding the
skills of the available workforce. Innovation and change are now basic requirements for success.
In the following pages, we will identify potential targets, based upon those criteria outlined
above and the results of the findings in the previous report. These targets will be identified by
the NAICS codes, many at the six digit level. North American Industry Classification System or
NAICS codes were developed as a standard for use by the federal statistical agencies in
categorizing business and industry, according to the NAICS Association.
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 7
Submitted by the Mike Barnes Group, Inc.
Targeted Industries and Businesses
As indicated previously, targets are subject to ―fit‖ within a community. Upon review of the
workforce and existing clusters, a concentrated effort was made to identify those industry
clusters that utilized the existing foundation while drawing upon new technologies and
expanding industries nationally and internationally. It is with those parameters in place that the
following targets are offered:
Primary Targets for Lufkin/Angelina County
*North American Industry Classification System (NAICS)
The above cited targets take advantage of the infrastructure, sites, workforce, and educational
foundation available within Lufkin/Angelina County. Utilizing linkages with Angelina College
and Stephen F. Austin University, tremendous opportunities exist within the Research and
Development, Consulting, and Environmental Services/Engineering sectors. In addition, there
are many components within the traditional industrial base of Lufkin/Angelina County that
provide transferable skills to the above targets.
Please see Appendix 1 for Input/Output Analysis of a number of primary and secondary targets
identified by the Consultant Team for Lufkin/Angelina County.
333294-333111*
Food Product Machinery Manufacturing
54162*
Environmental Consulting Services/Engineering
54171*
Research and Development in the
Physical, Engineering, and Life Sciences
54141-3*
Interior and Graphic Design Services
5614*
Business Support Services/Back Offices
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8 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
Targeted Industries and Businesses
Secondary Targets for Lufkin/Angelina County
*North American Industry Classification System (NAICS)
The following appendices illustrate the gaps that exist within Angelina County for satisfying the
needs of the primary and secondary targets. Those areas with large imported services obviously
are greater targets for Lufkin/Angelina County. Appendix 2 provides background information
on the targets and identifies industry leaders by name and sales in those sectors.
115112*
Soil Preparation, Planting, and
Cultivating115114*
Postharvest Crop Activities (except Cotton Ginning)
33321*
Sawmill and Woodworking
Machinery Manufacturing
3327*
Machine Shops; Turned Product; and Screw, Nut,
and Bolt Manufacturing
484122*
General Freight Trucking, Long-
Distance, Less Than Truckload
333993*
Packaging Machinery Manufacturing
3335*
Metalworking Machinery
Manufacturing
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 9
Submitted by the Mike Barnes Group, Inc.
Appendix 1
Gap Analysis Report
Economic Modeling Specialists, Inc. www.economicmodeling.com
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10 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
Region Info Region: Angelina Co. County Areas: Angelina, Texas (48005)
2010 Requirements for: Farm Machinery and Equipment Manufacturing
NAICS Code
Description Total
Requirements (K)
% Satisfied in Region
% Satisfied out of Region
331111 Iron and Steel Mills $9 0% 100%
332116 Metal Stamping $6 0% 100%
333618 Other Engine Equipment Manufacturing $6 0% 100%
551114 Corporate, Subsidiary, and Regional Managing Offices
$6 33% 67%
326199 All Other Plastics Product Manufacturing $4 0% 100%
331511 Iron Foundries $3 67% 0%
425120 Wholesale Trade Agents and Brokers $2 0% 100%
326291 Rubber Product Manufacturing for Mechanical Use
$2 0% 100%
326299 All Other Rubber Product Manufacturing $2 0% 100%
332710 Machine Shops $2 50% 50%
332912 Fluid Power Valve and Hose Fitting Manufacturing
$2 0% 100%
325510 Paint and Coating Manufacturing $2 0% 100%
541990 All Other Professional, Scientific, and Technical Services
$1 100% 0%
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 11
Submitted by the Mike Barnes Group, Inc.
333996 Fluid Power Pump and Motor Manufacturing $1 0% 100%
522110 Commercial Banking $1 0% 100%
331210 Iron and Steel Pipe and Tube Manufacturing from Purchased Steel
$1 0% 100%
332722 Bolt, Nut, Screw, Rivet, and Washer Manufacturing
$1 0% 100%
326211 Tire Manufacturing (except Retreading) $1 0% 100%
331221 Rolled Steel Shape Manufacturing $1 0% 100%
541330 Engineering Services $1 0% 100%
332991 Ball and Roller Bearing Manufacturing $1 0% 100%
332999 All Other Miscellaneous Fabricated Metal Product Manufacturing
$1 0% 100%
332911 Industrial Valve Manufacturing $1 0% 100%
517110 Wired Telecommunications Carriers $1 100% 0%
423430 Computer and Computer Peripheral Equipment and Software Merchant Wholesalers
$1 0% 100%
332721 Precision Turned Product Manufacturing $1 0% 100%
331513 Steel Foundries (except Investment) $1 0% 100%
326220 Rubber and Plastics Hoses and Belting Manufacturing
$1 0% 100%
335911 Storage Battery Manufacturing $1 0% 100%
333995 Fluid Power Cylinder and Actuator Manufacturing
$1 0% 100%
423830 Industrial Machinery and Equipment Merchant Wholesalers
$1 0% 0%
484121 General Freight Trucking, Long-Distance, Truckload
$1 100% 0%
424210 Drugs and Druggists' Sundries Merchant Wholesalers
$1 0% 100%
533110 Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)
$1 0% 100%
332919 Other Metal Valve and Pipe Fitting Manufacturing
$1 0% 100%
332111 Iron and Steel Forging $1 0% 0%
336399 All Other Motor Vehicle Parts Manufacturing $1 0% 100%
518210 Data Processing, Hosting, and Related Services
$1 0% 100%
333132 Oil and Gas Field Machinery and Equipment Manufacturing
$1 0% 100%
333120 Construction Machinery Manufacturing $1 0% 0%
327999 All Other Miscellaneous Nonmetallic Mineral Product Manufacturing
$1 0% 0%
423450 Medical, Dental, and Hospital Equipment and Supplies Merchant Wholesalers
$1 0% 100%
333612 Speed Changer, Industrial High-Speed Drive, and Gear Manufacturing
$1 100% 0%
331512 Steel Investment Foundries $1 0% 100%
423690 Other Electronic Parts and Equipment Merchant Wholesalers
$1 100% 0%
336350 Motor Vehicle Transmission and Power Train Parts Manufacturing
$1 0% 100%
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12 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
336370 Motor Vehicle Metal Stamping $1 0% 100%
Source: EMSI Complete Employment - 3rd Quarter 2010
Note: Requirements less than $1K are not shown
Data Sources and Calculations
Input-Output Data The input-output model in this report is created using the national Input-Output matrix provided by the federal Bureau of Economic Analysis. This is combined with the national Total Gross Output, the regional Total Gross Output, the land area of the subject region, regional DIRT data and regional in/out commuter patterns in order to calculate regional requirements, imports and exports. After using matrix algebra to calculate the regional multiplier, the resulting matrix is multiplied by the sales vector and converted back to jobs or earnings. Specifically, this data comes from the U.S. Department of Commerce, Bureau of Economic Analysis, Industry Economic Accounts: Benchmark & Annual Input-Output (I-O) Accounts.
State Data Sources This report uses state data from the following agencies: Texas Workforce Commission.
2010 Requirements for: Corporate, Subsidiary, and Regional Managing Offices
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 13
Submitted by the Mike Barnes Group, Inc.
NAICS Code
Description Total
Requirements (K)
% Satisfied in Region
% Satisfied out of Region
541110 Offices of Lawyers $2,870 36% 64%
517110 Wired Telecommunications Carriers $2,510 95% 5%
518210 Data Processing, Hosting, and Related Services
$1,762 0% 100%
541611 Administrative Management and General Management Consulting Services
$1,522 0% 100%
533110 Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)
$1,227 26% 74%
531210 Offices of Real Estate Agents and Brokers $1,183 28% 72%
531110 Lessors of Residential Buildings and Dwellings $1,161 95% 5%
531120 Lessors of Nonresidential Buildings (except Miniwarehouses)
$1,041 74% 26%
541810 Advertising Agencies $885 1% 99%
517210 Wireless Telecommunications Carriers (except Satellite)
$733 40% 60%
541990 All Other Professional, Scientific, and Technical Services
$617 95% 5%
541211 Offices of Certified Public Accountants $580 89% 11%
531390 Other Activities Related to Real Estate $557 90% 10%
541613 Marketing Consulting Services $469 0% 100%
541712 Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
$463 0% 100%
531311 Residential Property Managers $461 32% 68%
517911 Telecommunications Resellers $433 26% 74%
541690 Other Scientific and Technical Consulting Services
$384 7% 93%
541512 Computer Systems Design Services $372 11% 89%
221112 Fossil Fuel Electric Power Generation $363 2% 98%
524210 Insurance Agencies and Brokerages $348 50% 50%
541219 Other Accounting Services $330 95% 5%
531190 Lessors of Other Real Estate Property $325 95% 5%
221122 Electric Power Distribution $324 19% 81%
541820 Public Relations Agencies $317 1% 99%
531312 Nonresidential Property Managers $306 74% 26%
515120 Television Broadcasting $306 3% 97%
323110 Commercial Lithographic Printing $300 67% 33%
332710 Machine Shops $299 68% 32%
531130 Lessors of Miniwarehouses and Self-Storage Units
$297 95% 5%
541618 Other Management Consulting Services $269 3% 97%
541612 Human Resources Consulting Services $256 0% 100%
511110 Newspaper Publishers $249 79% 21%
221210 Natural Gas Distribution $235 89% 11%
541614 Process, Physical Distribution, and Logistics Consulting Services
$226 0% 100%
813910 Business Associations $214 62% 38%
813410 Civic and Social Organizations $197 34% 66%
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14 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
811310 Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance
$185 95% 5%
511120 Periodical Publishers $179 18% 82%
515112 Radio Stations $177 25% 75%
541860 Direct Mail Advertising $176 2% 98%
541890 Other Services Related to Advertising $176 16% 84%
541711 Research and Development in Biotechnology $172 0% 100%
221113 Nuclear Electric Power Generation $160 0% 100%
541620 Environmental Consulting Services $157 10% 90%
517919 All Other Telecommunications $153 1% 99%
541214 Payroll Services $151 3% 98%
519130 Internet Publishing and Broadcasting and Web Search Portals
$147 0% 100%
541330 Engineering Services $140 3% 97%
813920 Professional Organizations $137 3% 96%
Source: EMSI Complete Employment - 3rd Quarter 2010
Note: Requirements less than $1K are not shown
Data Sources and Calculations
Input-Output Data The input-output model in this report is created using the national Input-Output matrix provided by the federal Bureau of Economic Analysis. This is combined with the national Total Gross Output, the regional Total Gross Output, the land area of the subject region, regional DIRT data and regional in/out commuter patterns in order to calculate regional requirements, imports and exports. After using matrix algebra to calculate the regional multiplier, the resulting matrix is multiplied by the sales vector and converted back to jobs or earnings. Specifically, this data comes from the U.S. Department of Commerce, Bureau of Economic Analysis, Industry Economic Accounts: Benchmark & Annual Input-Output (I-O) Accounts.
State Data Sources This report uses state data from the following agencies: Texas Workforce Commission.
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 15
Submitted by the Mike Barnes Group, Inc.
2010 Requirements for: Forest Nurseries and Gathering of Forest Products
NAICS Code
Description Total
Requirements (K)
% Satisfied in Region
% Satisfied out of Region
115115 Farm Labor Contractors and Crew Leaders $1,158 0% 100%
115210 Support Activities for Animal Production $701 1% 99%
115114 Postharvest Crop Activities (except Cotton Ginning)
$566 0% 100%
115112 Soil Preparation, Planting, and Cultivating $436 3% 97%
115310 Support Activities for Forestry $279 15% 85%
115116 Farm Management Services $200 0% 100%
11A000 Crop and animal production $146 64% 37%
115113 Crop Harvesting, Primarily by Machine $98 0% 100%
115111 Cotton Ginning $84 0% 100%
333111 Farm Machinery and Equipment Manufacturing $28 0% 100%
522110 Commercial Banking $21 24% 76%
311119 Other Animal Food Manufacturing $20 0% 100%
711510 Independent Artists, Writers, and Performers $16 0% 100%
541330 Engineering Services $11 0% 91%
324110 Petroleum Refineries $8 13% 88%
425120 Wholesale Trade Agents and Brokers $7 14% 86%
811310 Commercial and Industrial Machinery and Equipment (except Automotive and Electronic) Repair and Maintenance
$4 100% 0%
113110 Timber Tract Operations $4 100% 0%
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16 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
541990 All Other Professional, Scientific, and Technical Services
$4 75% 0%
522120 Savings Institutions $3 0% 100%
423430 Computer and Computer Peripheral Equipment and Software Merchant Wholesalers
$3 0% 100%
541310 Architectural Services $3 0% 100%
522292 Real Estate Credit $3 0% 100%
423830 Industrial Machinery and Equipment Merchant Wholesalers
$2 50% 50%
522130 Credit Unions $2 0% 100%
541110 Offices of Lawyers $2 50% 50%
424210 Drugs and Druggists' Sundries Merchant Wholesalers
$2 50% 100%
713910 Golf Courses and Country Clubs $2 0% 100%
721110 Hotels (except Casino Hotels) and Motels $2 0% 100%
325320 Pesticide and Other Agricultural Chemical Manufacturing
$2 0% 100%
811111 General Automotive Repair $2 50% 0%
518210 Data Processing, Hosting, and Related Services
$2 0% 100%
423450 Medical, Dental, and Hospital Equipment and Supplies Merchant Wholesalers
$2 0% 100%
323110 Commercial Lithographic Printing $2 50% 50%
511210 Software Publishers $2 0% 100%
423690 Other Electronic Parts and Equipment Merchant Wholesalers
$2 100% 0%
424490 Other Grocery and Related Products Merchant Wholesalers
$1 100% 0%
811490 Other Personal and Household Goods Repair and Maintenance
$1 100% 0%
541380 Testing Laboratories $1 0% 100%
524126 Direct Property and Casualty Insurance Carriers
$1 0% 100%
424410 General Line Grocery Merchant Wholesalers $1 100% 0%
336399 All Other Motor Vehicle Parts Manufacturing $1 0% 100%
811121 Automotive Body, Paint, and Interior Repair and Maintenance
$1 100% 0%
423610 Electrical Apparatus and Equipment, Wiring Supplies, and Related Equipment Merchant Wholesalers
$1 100% 0%
322211 Corrugated and Solid Fiber Box Manufacturing $1 0% 100%
423990 Other Miscellaneous Durable Goods Merchant Wholesalers
$1 100% 0%
523120 Securities Brokerage $1 0% 100%
423120 Motor Vehicle Supplies and New Parts Merchant Wholesalers
$1 0% 100%
522310 Mortgage and Nonmortgage Loan Brokers $1 0% 100%
326211 Tire Manufacturing (except Retreading) $1 0% 100%
Source: EMSI Complete Employment - 3rd Quarter 2010
Note: Requirements less than $1K are not shown
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 17
Submitted by the Mike Barnes Group, Inc.
Data Sources and Calculations
Input-Output Data The input-output model in this report is created using the national Input-Output matrix provided by the federal Bureau of Economic Analysis. This is combined with the national Total Gross Output, the regional Total Gross Output, the land area of the subject region, regional DIRT data and regional in/out commuter patterns in order to calculate regional requirements, imports and exports. After using matrix algebra to calculate the regional multiplier, the resulting matrix is multiplied by the sales vector and converted back to jobs or earnings. Specifically, this data comes from the U.S. Department of Commerce, Bureau of Economic Analysis, Industry Economic Accounts: Benchmark & Annual Input-Output (I-O) Accounts.
State Data Sources This report uses state data from the following agencies: Texas Workforce Commission.
2010 Requirements for: All Other Industrial Machinery Manufacturing
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18 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
NAICS Code
Description Total
Requirements (K)
% Satisfied in Region
% Satisfied out of Region
551114 Corporate, Subsidiary, and Regional Managing Offices
$7 29% 71%
331111 Iron and Steel Mills $6 0% 100%
332710 Machine Shops $5 60% 40%
331511 Iron Foundries $2 100% 0%
425120 Wholesale Trade Agents and Brokers $2 0% 50%
335314 Relay and Industrial Control Manufacturing $2 0% 100%
517110 Wired Telecommunications Carriers $1 100% 0%
332991 Ball and Roller Bearing Manufacturing $1 0% 100%
335312 Motor and Generator Manufacturing $1 100% 100%
541990 All Other Professional, Scientific, and Technical Services
$1 100% 0%
522110 Commercial Banking $1 0% 100%
332813 Electroplating, Plating, Polishing, Anodizing, and Coloring
$1 100% 0%
331210 Iron and Steel Pipe and Tube Manufacturing from Purchased Steel
$1 0% 100%
331221 Rolled Steel Shape Manufacturing $1 0% 100%
423430 Computer and Computer Peripheral Equipment and Software Merchant Wholesalers
$1 0% 100%
518210 Data Processing, Hosting, and Related Services
$1 0% 100%
331513 Steel Foundries (except Investment) $1 0% 100%
332812 Metal Coating, Engraving (except Jewelry and Silverware), and Allied Services to Manufacturers
$1 0% 100%
333912 Air and Gas Compressor Manufacturing $1 0% 100%
332912 Fluid Power Valve and Hose Fitting Manufacturing
$1 0% 100%
333515 Cutting Tool and Machine Tool Accessory Manufacturing
$1 0% 100%
333612 Speed Changer, Industrial High-Speed Drive, and Gear Manufacturing
$1 100% 0%
331316 Aluminum Extruded Product Manufacturing $1 0% 100%
332722 Bolt, Nut, Screw, Rivet, and Washer Manufacturing
$1 0% 100%
332431 Metal Can Manufacturing $1 0% 100%
533110 Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)
$1 0% 0%
332312 Fabricated Structural Metal Manufacturing $1 0% 0%
333996 Fluid Power Pump and Motor Manufacturing $1 0% 100%
334413 Semiconductor and Related Device Manufacturing
$1 0% 100%
423830 Industrial Machinery and Equipment Merchant Wholesalers
$1 0% 0%
332999 All Other Miscellaneous Fabricated Metal Product Manufacturing
$1 0% 0%
333294 Food Product Machinery Manufacturing $1 0% 100%
332116 Metal Stamping $1 0% 100%
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The Lufkin/Angelina County Market Valuation and Action Plan, Part 2 19
Submitted by the Mike Barnes Group, Inc.
541712 Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
$1 0% 100%
551112 Offices of Other Holding Companies $1 0% 100%
424210 Drugs and Druggists' Sundries Merchant Wholesalers
$1 0% 0%
331315 Aluminum Sheet, Plate, and Foil Manufacturing $1 0% 100%
332721 Precision Turned Product Manufacturing $1 0% 100%
Source: EMSI Complete Employment - 3rd Quarter 2010
Note: Requirements less than $1K are not shown
Data Sources and Calculations
Input-Output Data The input-output model in this report is created using the national Input-Output matrix provided by the federal Bureau of Economic Analysis. This is combined with the national Total Gross Output, the regional Total Gross Output, the land area of the subject region, regional DIRT data and regional in/out commuter patterns in order to calculate regional requirements, imports and exports. After using matrix algebra to calculate the regional multiplier, the resulting matrix is multiplied by the sales vector and converted back to jobs or earnings. Specifically, this data comes from the U.S. Department of Commerce, Bureau of Economic Analysis, Industry Economic Accounts: Benchmark & Annual Input-Output (I-O) Accounts.
State Data Sources This report uses state data from the following agencies: Texas Workforce Commission.
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20 The Lufkin/Angelina County Market Valuation and Action Plan, Part 2
2010 Requirements for: Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
NAICS Code
Description Total
Requirements (K)
% Satisfied in Region
% Satisfied out of Region
541990 All Other Professional, Scientific, and Technical Services
$6 83% 0%
541611 Administrative Management and General Management Consulting Services
$4 0% 100%
541330 Engineering Services $4 0% 100%
561730 Landscaping Services $4 75% 25%
561720 Janitorial Services $4 75% 25%
561320 Temporary Help Services $3 100% 33%
541110 Offices of Lawyers $3 33% 67%
518210 Data Processing, Hosting, and Related Services
$3 0% 100%
531210 Offices of Real Estate Agents and Brokers $3 33% 67%
531110 Lessors of Residential Buildings and Dwellings $3 67% 0%
517110 Wired Telecommunications Carriers $3 67% 0%
561110 Office Administrative Services $3 33% 33%
522110 Commercial Banking $2 50% 100%
531120 Lessors of Nonresidential Buildings (except Miniwarehouses)
$2 100% 50%
551114 Corporate, Subsidiary, and Regional Managing Offices
$2 50% 50%
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The Lufkin/Angelina County Market