Spotlight on Tuscaloosa: Economic Engines

University of Alabama / Higher Education

With 6,175 employees, the University of Alabama (UA), the flagship institution of the University of Alabama System, is the top employer in Tuscaloosa County and a driving force in the area’s economy.

UA had an economic impact of more than $2 billion in the three-county Tuscaloosa metro area during the 2019-2020 academic year and was responsible for an estimated $42.7 million in local sales taxes, according to the most recent report conducted by the Center for Business and Economic Research in the UA Culverhouse College of Business.

The school’s economic impact comes from three main areas: direct spending by UA, which had a total impact of $978 million; student spending, which had an impact of $904 million; and visitors coming to Tuscaloosa, which had an estimated $200 million impact in the area (each of the seven home games in the fall of 2019 generated an average $19.8 million).

The report also projects that the graduating class of 2020 will pay more than $1 billion in additional state income and sales tax compared to what they would without a degree, and Alabama will realize a nearly 12% annual rate of return on its investment in those graduates.

Shelton State Community College, one of the largest two-year colleges in Alabama, and Stillman College, a private historically Black liberal arts college, also have significant economic impact in the county and are known for forging progressive partnerships with local industry and community leaders to support their students’ academic and professional growth.

Mercedes-Benz US International Inc. / Automotive

The Mercedes-Benz plant in Tuscaloosa, founded in 1995, was the company’s first major passenger car production facility outside of Germany, and the facility is the home of SUV production for the GLE, GLE coupe and GLS model series.

The plant also serves as a key production location for Mercedes-EQ luxury electric SUVs: the EQS SUV and EQE SUVE, which went into production last year. Their rollout was a key step in the company’s global initiative to produce eight all-electric vehicles at seven sites on three continents.

Since the 1990s, Mercedes-Benz has invested more than $7 billion in Alabama, including $1 billion to support a new factory in nearby Bibb County that produces the battery systems for the EQS SUV, logistics centers and to upgrade the production line to make EVs.

MBUSI employs approximately 4,500 people and secures an estimated 11,000 additional jobs with suppliers and service providers in the region.

Around 4 million vehicles have left the Tuscaloosa plant since 1997, and roughly two-thirds of the plant’s annual production is exported, making MBUSI one of the largest automobile exporters in the country.

Other drivers in Tuscaloosa County’s automotive industry include SMP Automotive, Brose Tuscaloosa, ARD Logistics, ZF Chassis Systems Tuscaloosa and Lear Corp.

Tire maker Michelin/BF Goodrich is also among the top 10 employers in the county, with 1,400 workers. It conducts two main activities: manufacturing passenger car and light truck tires and producing semi-finished materials, such as uncured rubber and associated materials for tire construction.

Health Care

Health care accounts for 8.7% of total jobs in Tuscaloosa County, according to the county’s Economic Development Authority, thanks to the presence of several high-quality service providers and the college programs that support students who are pursuing careers in health care.

The DCH Health System, which is celebrating its 100th anniversary this year, includes the DCH Regional Medical Center and Northport Hospital, both in Tuscaloosa County. The system is one of the county’s top employers with 3,752 employees. DCH cares for more than 300,000 residents of West Alabama.

Tuscaloosa Veterans Administration Medical Center is the ninth largest overall employer in the county with 1,225 employees, and Noland Hospital Tuscaloosa is the largest provider of long-term acute care hospital services in the state and the only such provider in West Alabama.

Tuscaloosa County is also home to three facilities that are owned and operated by the Alabama Department of Mental Health: Bryce Hospital, Mary Starke Harper Geriatric Psychiatry Center and Taylor Hardin Secure Medical Facility.

Tourism

While Tuscaloosa is legendary for its sports scene, the tourism industry continues to grow in other areas, too. When fans aren’t filling the stadiums, they are visiting attractions like the Tuscaloosa Civil Rights Trail, the Moundville Archaeological Park and new establishments like The Venue. And in Northport, three big recreational projects are under development — a water park, an outdoor adventure park and the Kentuck Sports Complex.

In 2022, Tuscaloosa hotel revenue reached $104 million, a new high that resulted in more than $11 million in lodging tax collections for the city. Overall, travelers to Tuscaloosa County spent $895 million on hotels, restaurants, shopping and transportation.

The tourism industry was responsible for more than 9,854 jobs in 2022 and is expected to continue growing. The hotel market includes 4,400 hotel rooms across the county, more than 90% within Tuscaloosa city limits. Officials estimate that nearly 2 million visitors stayed in hotels in the area in 2022.

Metals

A subsidiary of Nucor Corp., the largest steel producer in the county, Nucor Steel Tuscaloosa specializes in hot rolled steel coils and cut-to-length plate.

Headquartered in Tuscaloosa, Phifer Inc. is the world’s largest producer of aluminum and fiberglass insect screening and conducts business in all 50 states and 125 countries. The facility produces more than 60% of the world’s fiberglass insect screening.

Business Briefs:

MAY 2023: Alabama Southern Railroad announces a second rail yard in Tuscaloosa to provide additional capacity. The company plans to invest around $9.8 million in constructing the new facility, which should be operational in 2024.

MAY 2023: The City of Tuscaloosa breaks ground on the Western Riverwalk extension.

APRIL 2023: The Chamber of Commerce of West Alabama selects Kyle South as president and CEO following the resignation of Jim Page earlier this year.

MARCH 2023: Canadian-based Epsilon Industries announces Tuscaloosa as the first U.S. location for the off-site construction system manufacturer. The project, near Tuscaloosa National Airport, is a $3 million investment bringing 180 new jobs.

JANUARY 2023: Hanna Steel Corp. announces expansion plans for its steel tubing production facility in the Airport Industrial Park. Hanna will invest $20 million and expects new production to start in 2025.

DECEMBER 2022: The City of Tuscaloosa accepts 6.65 acres of land valued at more than $1.9 million from the Randall family to expand the Northern Riverwalk.

OCTOBER 2022: The Tuscaloosa City Council approves a $7 million construction contract for the Tuscaloosa National Airport to expand the runway to accommodate larger planes. The project is part of a plan to bring commercial passenger air service back to Tuscaloosa.

SEPTEMBER 2022: Buffalo Rock Co. announces the relocation of its Tuscaloosa bottling facility to a 14-acre greenfield site in the Airport Industrial Park. The company will invest $3.88 million in new construction and relocation.

AUGUST 2022: The first all-electric Mercedes built in the United States, the EQS SUV, rolls off the assembly line at the Tuscaloosa County plant. The company has made a $1 billion investment in electric vehicle production that includes logistics centers and a Bibb County battery assembly plant.

JULY 2022: Fit Foodz announces it is investing more than $15 million in a new poultry processing facility in Tuscaloosa that is expected to create 180 jobs. Headquartered in Atlanta, Fit Foodz is a woman- and minority-owned business.

MARCH 2022: JNJ Production announces an expansion of its existing operations in Northport to increase production capacity and locate all corporate services together. JNJ will invest $5.12 million to support the expansion and anticipates creating 34 jobs. Construction is expected to be complete in 2024.

SEPTEMBER 2021: Li-Cycle announces a new lithium-ion battery recycling facility in Tuscaloosa, which came online about a year later. The facility is able to process up to 5,000 tons of manufacturing scrap and end-of-life batteries per year. Li-Cycle activities provide support to the growing EV market. The $18.7 million project is expected to generate 78 jobs.

This article appears in the September 2023 issue of Business Alabama.