National focus, workforce keys to growing Arkansas’ aerospace and defense industry

Continued growth in Arkansas’ aerospace and defense industry needs a “national priority” like that set by President John Kennedy when he challenged the nation to go to the Moon, Gov. Asa Hutchinson said Wednesday (April 23) during his keynote speech at the Mid-America Aerospace and Defense Summit.

“There has to be consistency, there has to be a long-term commitment,” Hutchinson told the crowd of around 225 gathered at the summit held at the Fort Smith Convention Center. The event was conducted by the Arkansas Aerospace and Defense Alliance.

He said a renewed federal focus on the aerospace and defense industries are “key critical ingredients that we should not retreat from.”

Growth in the sector is important to the state’s economic health, Hutchinson said, noting that the more than 240 aerospace and defense companies in the state employ around 10,000. He also said 15.4% of the state’s total exports are tied to the aerospace and defense industry. At 30%, France was the largest recipient of Arkansas’ aircraft and aircraft parts exports, followed by Switzerland at 12%, and the British Virgin Islands at 9%, according to the governor.

In remarks later in the day, Arkansas Economic Development Commission Executive Director Mike Preston said the two sectors have a total $2 billion economic impact on the state.

The governor also said Congress needs to ratify the proposed United States-Mexico-Canada (USMCA) trade agreement that would replace NAFTA, which regulates trade between the three countries. Congress has yet to take up the issue, and tariffs between the three countries have complicated the political process of full enactment of the USMCA.

“We [Arkansas’ aerospace and defense industry] are in the supply chain. We are going back and forth across the borders,” Hutchinson said of the need to normalize trade relations.

Developing a skilled workforce is also key to growth in the sectors, Gov. Hutchinson said. To this point, he touted his computer coding program now in the state’s high schools. He said the program began with fewer than 1,000 students, and in the recent year 8,000 high school students were in a computer science class.

He also praised education leaders who understand that college is just one option for career advancement.

“[G]oing to college is a good idea, but if you want to get skilled training, that is also a good idea,” Hutchinson said in summarizing the message now advanced to high school students.

Preston said developing and maintaining a quality workforce is “the elephant in the room,” with companies wanting to know, “Is the talent out there?” before considering Arkansas as a place to do business. Preston said recent successes to land new companies and help existing companies grow indicates the state is competitive on the workforce issue.

A recent example was Tuesday’s announcement that CZ-USA, a Czech Republic-based gun manufacturer, would locate its North American headquarters in the Little Rock Port Authority. The planned $90 million facility will manufacture, warehouse and distribute the company’s firearms, and employ up to 565 workers over the next six years. That relationship first began at the national SHOT Show held each year in Las Vegas. Preston said Arkansas has had a presence at the show every year Hutchinson has been governor.

“There is a reason we were on their radar screen,” Preston said of CZ-USA. “It’s because we go out there.”

He said the state also sends a delegation each year to the Paris Air Show. Part of the job at such high-profile trade shows and events is to “overcome perceptions” and “show that Arkansas is a good place to do business,” Preston said.

The Arkansas Aerospace & Defense Alliance is a group of public and private aerospace companies, government agencies and educational institutions working in or with connections to the aerospace, aviation and defense industries. The group began in 2006 as a Little Rock Municipal Airport Commission task force and was organized into the alliance in 2012 by the Arkansas State Chamber of Commerce/Associated Industries of Arkansas with input from the Arkansas Economic Development Commission (AEDC). Chad Causey is executive director of the alliance.