2021: A Record Year for Economic Growth and Investment

By Cory McCauley, Building Kentucky

Governor Andy Beshear confirmed last year’s books are officially closed and Kentucky indeed shattered the all-time records for investment and job creation in 2021. Gov. Beshear said Kentucky secured 264 private-sector new-location and expansion projects, a more than $11 billion investment in the Commonwealth.

These investments bring more than 18,000 full-time jobs to Kentucky.

Wages are rising in the Commonwealth as well, as Kentucky’s average incentivized hourly wage for projects statewide in 2021 was $24 before benefits, a 9.4% increase over the previous year and the second highest mark of the past seven years.

“The past year has included a number of challenges, from our continued fight against the pandemic to the tragic tornadoes that impacted so many lives in Western Kentucky,” Gov. Beshear said. “But it has also been a year of hope, with great reason to believe the future is bright in the commonwealth. This record year of economic growth means well-paying jobs for Kentuckians throughout the state and a vibrant, diverse economy that can support our workforce in the face of whatever challenges arise in the years ahead. I want to thank every company that has bet their future on Kentucky and our workforce. I look forward to continuing this record-breaking momentum in 2022.”

Kentucky’s record 2021 included the single largest economic development project in the state’s history. In September, Ford Motor Co. announced a transformative $5.8 billion investment to establish the BlueOvalSK Battery Park in Hardin County, which will create 5,000 jobs and place Kentucky at the forefront of the automotive industry’s future.

The record-breaking project is at the center of the state’s automotive industry growth, which is among many industry sectors contributing to Kentucky’s economic success.

Here’s a breakdown of the investments in 2021 based on industry sector:

Automotive

The past year included more than 40 announcements totaling more than $6 billion in new investments and more than 7,200 full-time jobs, as companies within the sector continue to evolve and prepare for a future that will rely more heavily on electric power.

Manufacturing

This business sector remains a driving force behind Kentucky’s continued economic growth. 2021 included more than $10 billion in new investments contributing to 13,900 of the announced jobs over the past year.

Beverage and Agritech

The beverage and agritech industries combined saw more than $1 billion in new investments across 46 projects that will create over 1,200 full-time jobs. That includes 20 announcements by bourbon and spirits-related companies creating 371 jobs with $391 million in investments.

Metals-related Operations

Twenty four new-location or expansion projects in 2021 created more than 1,700 jobs with $975 million in announced investments. In addition, 43 business and financial services and headquarters operations will create 3,700 new Kentucky jobs behind $770 million in new investments.

Plastics and Rubber

Within the plastics and rubber industries, 2021 brought 639 new jobs with $295 million in investments.

Logistics and Distribution

The logistics and distribution industries saw continued growth with 1,000 new jobs created and $181 million in investments. These industries played a significant role in attracting new business. Kentucky is situated in an ideal geographic location, within a day’s drive of two-thirds of the U.S. population and three key international shipping hubs operated by Amazon, DHL and UPS.

Momentum for 2022

Kentucky’s economic momentum extends to small business and workforce initiatives, as well. In 2021, 107 Kentucky businesses capitalized on the Kentucky Small Business Tax Credit (KSBTC), creating 339 jobs with $3.64 million in reinvestment.

Kentucky’s record year for investment and planned job creation furthers recent economic success in the Commonwealth, as the state builds back stronger in response to the effects of the pandemic.

In July, the state budget office reported the Commonwealth ended the 2021 fiscal year with a general fund surplus over $1.1 billion – the highest ever in the state – and a 10.9% increase in general fund receipts to $12.8 billion.

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