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Jabil to build headquarters, add 858 jobs in St. Petersburg

ST. PETERSBURG — One day after laying off 120 workers, one of Tampa Bay's largest high-tech employers announced Friday it will build its world headquarters here and create 858 jobs in exchange for $34.4-million in economic incentives.

Jabil Circuit said it will build and equip its base of operations along Gandy Boulevard in north St. Petersburg, and also create manufacturing, research and development facilities, with total construction estimated at $54-million.

And it has no plans to resort to more layoffs of its local staff, though that pledge is not yet part of its deal to get the economic incentives.

Jabil gets the incentives only after it adds the workers at an average annual salary of $42,685. Jabil also must build $49-million in facilities, which officials estimated could generate about $300,000 annually in new tax revenue to the county.

State and local leaders called the decision a much-needed economic boost to Florida's high-tech industries.

"The company's contributions to our business community have translated into high-value jobs, innovative solutions and many other benefits to the state, as well as the Tampa Bay region," Gov. Charlie Crist said. "I welcome the successes that are sure to come from Jabil's expansion."

Mayor Rick Baker called it the city's most significant economic deal since he took office in 2001. "Any city in America would be pleased to have a new corporate headquarters," Baker said.

Friday's announcement culminates months of maneuvering by Jabil.

Secret negotiations to keep the company and its 1,880 jobs began in October after Jabil announced it was looking to relocate. In March, the company put out a request for state and local incentives for its corporate headquarters and manufacturing operations. California and Michigan replied. Jabil decided to stay put even though Michigan offered more cash.

"I'm not sure what the numbers were, but it was larger than Florida in terms of dollars and cents," said Jabil chief executive Timothy Main. "Our preference was to stay in Florida and not create disruption to our business and our employees."

Ground could be broken later this year, and construction could take up to two years. "They won't get any financial support from us unless they deliver," Baker said.

Most of the new jobs will be in Jabil's growing defense and aerospace electronics business and the rest in corporate administration, work more likely to stay in the United States because it doesn't depend on low-cost production like consumer products, Main said. Hiring for the new jobs could begin within the year and is scheduled to be completed by 2012.

Jabil, a Fortune 500 electronics manufacturing company and one of the largest publicly traded companies in the Tampa Bay area, has outposts around the globe, with 75,000 employees in 20 countries. The company has a growing presence in China, India, Mexico, Vietnam and Ukraine, all locations with cheap labor and low manufacturing costs.

Thursday's layoffs stemmed from the economic downturn, the company said. But some workers said supervisors told them their jobs were headed to Jabil facilities in China.

At its peak, Jabil employed more than 3,000 people in St. Petersburg. The company said it has increased its staff by 28 percent since 2003, but it does move work among countries based on "the cost needs of our customers," Main said.

The biggest chunk of the $34.4-million incentives package would be paid by the state. The county plans to chip in $1.7-million. The city's $12.7-million share includes grants, tax refunds, and road and utility improvements.

The City Council approved the incentives package in June without any public discussion, sparking public outrage over secrecy surrounding millions of tax dollars for a private company.

The council will hold a workshop on economic development incentives Thursday to address concerns that such deals shouldn't be done out of the public eye.

This isn't the first time Jabil has asked for a government handout. The company was promised $3.4-million in state tax refunds in 2001 in exchange for creating 1,150 jobs in Florida. Jabil didn't follow through.

Jabil has alluded to construction of corporate headquarters in St. Petersburg since late 2006, according to public records.

In December 2006, the city's environmental development commission approved a conceptual site plan to "construct a 2.06-million (square foot) … corporate headquarters for Jabil Circuit" along Gandy Boulevard. It's the same site where Jabil would build its facility under the incentives package.

"It's always hard to measure how serious someone is about leaving or not," acknowledged Baker. "But you can't roll the dice."

Cristina Silva can be reached at (727) 893-8846 or csilva@sptimes.com.

Jabil to build headquarters, add 858 jobs in St. Petersburg 09/12/08 [Last modified: Friday, September 12, 2008 10:40pm]
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