Major Industries and Commercial Activity
In May 2005, Forbes chose Lincoln as the seventh "Best Smaller Metro" area for business and careers with a third place ranking for income growth. Located in a grain and livestock producing region, Lincoln has since its founding been a communications, distribution, and wholesaling hub. Important industries are the manufacture and repair of locomotives, flour and feed milling, grain storage, and diversified manufacturing. State government and the University of Nebraska constitute approximately a quarter of the city's economy, but about 90 percent of Lincoln's some 8,000 employers are companies with 20 or fewer employees. Lincoln is also the corporate headquarters of several insurance companies.
During the 1980s and 1990s Lincoln experienced sustained growth that brought economic expansion, with the employment base increasing 2.5 percent annually. Despite the recession in the early 2000s, retail trade, for example, continued to grow at a higher rate than other metropolitan areas in the state. Although the manufacturing industry has typically shown growth above the state average, the overall employment figures have declined with the economic downturn.
A number of Lincoln's local companies conduct business throughout the United States and in foreign countries. Among them are Ameritas Financial Services, Selection Research Inc./Gallup Poll, Lester Electrical, and Cook Family Foods. Sandhills Publishing (formerly Peed Corporation), publishers of national trade magazines, has maintained its facilities in Lincoln since 1985. MDS Harris Laboratories, a pharmaceutical testing and research firm that serves all 50 states and dozens of nations abroad has an office in Beijing, China, and has expanded its medical testing business into the development of a biological warfare vaccine for the U.S. Army, which was the first such test conducted under Food and Drug Administration standards. In addition to its traditional strength of testing medicines on "well normal" people to confirm safety standards, the company tests how people with illnesses react to new medicines. Pfizer Laboratories supplies veterinary products in the United States and dozens of foreign countries.
Items and goods produced: creamery products, farm machinery, farm belts, veterinary supplies, radiator hoses, telephone equipment, biological products, pharmaceutical supplies, plumbing supplies, pumps, motors, motor scooters, wax, filing equipment and office supplies, and printing, lithographic, engraving, metal, stone, and concrete products
Incentive Programs—New and Existing Businesses
The Lincoln Independent Business Association, the Chamber of Commerce, Southeast Community College, the University of Nebraska-Lincoln, and the city of Lincoln operate a small business resource center that helps businesses secure financing, permits, and information about other resources. Several major established industrial parks cover more than 1,000 acres and are designed for both heavy industry and multiple use. The City of Lincoln Research and Development Department, with assistance from the Nebraska Research and Development Authority, provides block grant funds to aid startup businesses. The Lincoln Partnership for Economic Development (LPED) began formal operations in 1996. LPED is a community-based, public-private, permanent venture to provide strategic, focused direction for Lincoln's economic development activities. The Community Development Resources (CDR) provides loans and capital with a focus on assisting low-income, minority groups, and women.
Qualified Omaha businesses can take advantage of state and local programs such as the Nebraska Business and Development Center and the Procurement Technical Assistance Center, which provide technical and research assistance. Invest Nebraska partners with the state of Nebraska along with other donations to introduce entrepreneurs to individual investors and venture capital firms. Federal and state programs include the Minority Enterprise Small Business Investment Corporation, the Nebraska Investment Finance Authority (NIFA), various Small Business Administration loans, the Nebraska Research and Development Authority, the Small Business Innovation Research Program (SBIR), and the Urban Development Action Grant.
The state of Nebraska has emphasized its commitment to revitalized economic growth in all parts of the state with a series of laws designed to make the state an even better place to do business. Firms can now earn a series of tax credits and refunds for investment and new job creation through the provisions of the Employment and Investment Growth Act (LB 775), as well as the Employment Expansion and Investment Incentive Act (LB 270), the Enterprise Zone Act (LB 725), Quality Jobs Act (LB 829), Incentive Electric Rates (LB 828), and Nebraska Redevelopment Act (LB 830).
The Community Development Resources (CDR) offers a variety of training and workshops for both profit and nonprofit businesses, such as writing a business plan. For manufacturing firms, the Nebraska Department of Economic Development facilitates a Customized Job Training Program for eligible companies and disperses job training grants. The Nebraska Worker Training Program works to update the skills of existing employees and awards grants quarterly.
Lincoln's downtown business district continues to thrive and its growth is a critical focus for city planners who implemented a "Downtown Master Plan" beginning in 2004 that works to ensure new construction and renovation along with maintaining the natural beauty of the area. Proposals include a civic square with 100,000 square feet of office space and 5,000 square feet of retail space along with new hotels, conversion of a power station to condominiums, and additional parking structures. Several projects have already been completed including a new movie theater and renovation of the Cornhusker Hotel.
The Lincoln Public Schools system expanded with the opening of two new high schools, Lincoln North Star in 2003 and Lincoln Southwest in 2002, with monies from a $100 million school bond.
Economic Development Information: Lincoln Partnership for Economic Development, 1135 M St., Ste. 200, Lincoln, NE 68508; telephone (402)436-2350; Fax (402)436-2360
Lincoln is connected with national and world markets via 2 major railroads—Burlington Northern/Santa Fe and Union Pacific—that provide piggyback transportation; 22 interstate and 9 intrastate motor freight companies; and 6 national and several local air express and freight carriers. Next to the Lincoln Municipal Airport lies a 372-acre Foreign Trade Zone (FTZ) that helps in facilitating imported goods. The city is also conveniently situated within 50 miles of water transportation atMississippi River terminals.
Labor Force and Employment Outlook
Lincoln's labor force is described as dependable, productive, and highly skilled and educated. Employers may draw from a large student population. Work stoppages are rare, with unionization estimated around 25 percent. As agriculture declines, more rural laborers are seeking jobs in the city.
A diversified economy has enabled employment in Lincoln to remain resilient since the nationwide recession during the early 2000s. Among non-manufacturing categories, Lincoln has been strong in construction, wholesale and retail trade, and services. Lincoln has a large number of information systems jobs with small companies that continues to grow at a rate of nearly eight percent.
The following is a summary of data regarding the Lincoln metropolitan area labor force, 2004 annual average:
Size of non-agricultural labor force: 168,000
Number of workers employed in . . .
construction and mining: 8,800
trade, transportation, and utilities: 28,600
financial activities: 11,600
professional and business services: 16,900
educational and health services: 23,400
leisure and hospitality: 15,700
other services: 6,900
Average hourly earnings of production workers employed in manufacturing: $15.95
Unemployment rate: 3.9% (February 2005)
Cost of Living
The city of Lincoln boasts a low tax burden with a high quality of services. The following is a summary of data regarding several key cost of living factors in the Lincoln area.
2004 (3rd Quarter) ACCRA Average House Price: $271,419
2004 (3rd Quarter) ACCRA Cost of Living Index: 95.9 (U.S. average = 100.0)
State income tax rate: Graduated from 2.56% to 6.84% (2004; rate set yearly by state legislature)
State sales tax rate: 5.5%
Local income tax rate: None
Local sales tax rate: 1.5%
Property tax rate: $2.051 per $100 of actual value (consoli-dated, 2004)
Economic Information: Lincoln Partnership for Economic Development, 1135 M St., Ste. 200, Lincoln, NE 68508; telephone (402)436-2350; Fax (402)436-2360
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