Major Industries and Commercial Activity
The geography of Louisville, specifically its river accessibility, central location, and mild climate have contributed to its importance as a center for industry and commerce. Kentucky has historically been a mining and agricultural state, but Louisville has greatly diversified its economic base in recent years. The city has traditionally been a manufacturing center for durable goods including appliances, cars and trucks. More recently, the area's economy has diversified, bringing with it more skilled and high-tech employment opportunities.
Like the rest of Kentucky, Louisville is undergoing a new era of economic development, with the public and private sectors working together to attract new industries while retaining existing businesses. In 2003, Entrepeneur magazine ranked Louisville #1 for "Best City for Small Business Growth." The same magazine also ranked the city #15 nationally and 2nd in the Midwest in a list of the "Top 25 Best Cities for Entrepreneurs."
The Louisville area is headquarters to some of the nation's top companies, including Fortune 500 companies Yum! Brands Inc., which includes KFC (formerly Kentucky Fried Chicken), Kindred Healthcare and Humana Inc. One of the better-known industries based in Louisville is Hillerich & Bradsby, makers of the famous "Louisville Slugger" baseball bat. The headquarters for Presbyterian Church (USA) and the American Printing House for the Blind, the official source of texts for the visually impaired, are also in the city. Ford Motor Co. has two plants in the area that produce the Explorer, Sport Trac, Mountaineer, commercial light trucks, and F-series pick-ups. Manufacturing plants for GE Consumer Products and Swift & Co. are also located in Louisville. Companies new to the area since 2000 are Charter Communications (cable TV), Gordon Foods, Linens n Things, and Reynolds/Alcoa.
The services sector is the leading economic sector in the region. In Greater Louisville, nearly 14,000 facilities employed 234,000 workers in 2001. Tourism leads the region's service industries; approximately 26,000 of these jobs are generated by the tourism industry in Jefferson County. Travelers spend nearly $1.2 billion a year in the county, and more than 880,000 convention delegates visited Louisville in 2000-2001. Greater Louisville is also an important center for local, state, and federal government agencies, which employ more than 71,000 area residents. The Kentucky Air National Guard and Army National Guard are headquartered at the Louisville International Airport's Standiford field; the U.S. Defense Department operates the Defense Mapping Agency and a veteran's hospital in the area; and the U.S. Corp of Engineers maintains the McAlpine Locks and Dam.
Items and goods produced: chemicals, automobiles, machinery, electrical appliances, processed foods, published materials, farm tools, aluminum, industrial machinery, lumber, timber products, baked goods, office products
Incentive Programs—New and Existing Companies
Greater Louisville Inc. is the agency responsible for working with new and existing businesses to create new jobs and capital investment in Louisville. It was formed by the merger of the Greater Louisville Economic Development Partnership and the Louisville Chamber of Commerce. A $3 million grant from the U.S. Department of Labor, Employment and Training Administration in 2002 is providing support to Greater Louisville Inc. for the recruitment and training of healthcare workers. The award became known as the Kentuckiana Healthcare Workforce Initiative. In addition to low taxes and low costs of doing business, Louisville offers a variety of financial incentives. Among them are the Louisville Metro Manufacturing Tax Moratorium which offers new or expanding manufacturing operations a five-year moratorium on all assessed property and real estate taxes. The Louisville Metro Brownfields Loan Program provides financing for economic development in older industrial areas of the city. Greater Louisville's Foreign Trade Zone is located within Clark Maritime Center, Eastpoint Business Center, Jefferson Riverport International and the Greater Louisville Technological Park.
The following incentives are available: Kentucky Jobs Development Act, Kentucky Industrial Development Act, low interest loans, industrial revenue bonds, community development block grants, enterprise zone, foreign trade zone, Bluegrass State Skills Corporation, job recruitment and placement, and Indiana incentives.
Job training programs
The unique partnership of the University of Louisville, Jefferson Community College, Jefferson Technical College and UPS established the Metropolitan College. The College addresses workforce needs by providing special curricula and work-friendly class schedules that cater to the needs of college students who work at night, enabling them to study for technical certifications, two-year, or four-year degrees. The Bluegrass State Skills Corporation (BSSC) provides training grants and investment credits for job training projects.
In 2001 a $121 million, two-phase plan was unveiled for major construction and renovations at one of the area's biggest attractions, Churchill Downs. With Phase One construction finished by 2003, part of the changes included more seating, new viewing suites, a new club and meeting space, renovation of the first floor grandstand, and new elevators. Phase Two of the construction, underway in early 2005, includes modernization of the clubhouse, installation of lights around the track, new restaurant and entertainment areas, and a year-round satellite wagering facility with seating. Phase Two is expected to be completed by the 2005 Kentucky Derby, held on the first Saturday in May.
Construction and revitalization activity in Louisville was brisk in the mid-2000s. Recent development in the city includes the Southeastern Christian Church with its $31 million, 294,100-square-foot Worship Center, a seven-story, nearly circular-shaped structure featuring white precast concrete exterior wall panels and a copper-colored roof. The Louisville Extreme Park is a public skatepark owned and operated by Metro Louisville. Opened to the public in 2002, the park features a 24-foot full pipe, 40,000 square feet of outdoor concrete skating surface and a wooden vertical ramp for skateboarders, inline skaters, and bikers. Glassworks, an eight-story historic building in downtown Louisville, has been converted into 41 loft apartments, office and commercial space, an artglass studio and restaurant. The new 4th Street Live! is a $75 million redevelopment of the former antiquated Louisville Galleria in the heart of downtown. Opened in 2004, the refurbished entertainment and retail district offers restaurants, bars, nightclubs, a comedy club, and live music, as well as a food court and a half dozen retail shops.
Louisville also has several development projects on the drawing board or in the first stages of completion. The Kentucky Center for African American Heritage project encompasses the renovation of four historic trolley barns as a center for the telling of the story of African Americans in Kentucky. The Center, scheduled for completion in March 2005 in the historic Russell district of Louisville, houses a museum, research center, artists' studio, sculpture garden and shops. Also scheduled to open in spring 2005 is the Muhammed Ali Center, a museum dedicated to the ideals of Muhammed Ali. Exhibits showcase his biography and other Center features include educational classrooms, theater, auditorium, exhibits gallery, library, shops, and a cafe. The Louisville Medical Center Development Corporation, created to capitalize on the economic development opportunities in the Medical Center, has plans to add to its three research park facilities which currently house life science, medical device, and health care technology companies. The planned expansion includes 700,000 square feet of wet lab and office space. Two new office/warehouse facilities will be built at Freeport Center at Riverport, about 10 miles outside Louisville's central business district in a thriving part of town. Park DuValle is a new $180 million revitalization project scheduled for completion in 2008. This development will restore a 125-acre urban neighborhood and feature 450 homes, 600 apartments, schools, parks, a health center, shops, and churches.
Economic Development Information: Greater Louisville Inc., 614 West Main Street, Louisville, KY 40202; telephone (502)625-0000. Kentucky Cabinet For Economic Development, 500 Mero Street, Capital Plaza Tower, Frankfort KY 40601; telephone (502)564-7140; (800)626-2930. Louisville Metro Development Authority, 444 South Fifth Street, Suite 600, Louisville, KY 40202; telephone (502)574-4140; fax (502)574-4143.
Louisville's economy is served by 40 motor carriers and Louisville is home to CSX and Norfolk Southern Railroad systems that connect the city with major markets in the United States, Canada, and Mexico. Louisville is the international air-freight hub for United Parcel Service; UPS Worldport handles the twelfth-largest amount of cargo tonnage in the world and offers next-day air service to 200 markets, including China, the Far East, Europe and Russia. The Louisville International Airport handles 3.6 billion tons of cargo annually. Another important component in the local economy is the Port of Louisville, which handles an average of seven million tons of cargo yearly.
Labor Force and Employment Outlook
Louisville boasts a steadily growing number of workers. Between 1990 and 2000, Greater Louisville added more than 160,000 net jobs, the greatest growth in the area's history, according to The Louisville Labor Force 2003 report by the University of Louisville. The employment rate grew 13 percent during this period, compared to an 11 percent growth nationally. A key element in this job picture is the growth in female employment. While the male employment rate in the area has seen little change since 1980, the female employment rate has risen 12 percent. Also contributing to the increasingly attractive employment outlook is the growth in the area's population. Despite a twenty-year trend of low birth rates and high mortality rates, the Louisville metropolitan area population began to reverse its declines through migration to the area in the 1990s. By the new millenium, its population grew almost as fast as the nation as a whole.
Louisville's workforce continues to suffer from a lack of educational attainment, especially compared to competitive markets. Its low rate of college attainment translates into relatively low earnings for workers. But Louisville has seen an improvement in the higher education of its young adult population in recent years. In the decade 1990 to 2000, young people aged 25 to 34 completing college increased from 20 percent to 27 percent.
The following is a summary of data regarding the Louisville metropolitan area labor force, 2003 annual averages.
Size of nonagricultural labor force: 561,400
Number of workers employed in . . .
mining and construction: 29,300
transportation, communication, and utilities: 123,500
financial activities: 37,400
professional and business services: 62,900
educational and health services: 70,700
leisure and hospitality: 107,100
other services: 30,300
Average hourly earnings of production workers employed in manufacturing: $19.66
Unemployment rate: 4.2% (December 2004)
Cost of Living
Costs are lower than might be expected in a metropolitan area of Louisville's size, due in part to the fact that the population is spread out over seven largely rural counties in Kentucky and Indiana.
The following is a summary of data regarding several key cost of living factors for the Louisville area.
2004 (3rd Quarter) ACCRA Average House Price:$203,091
2004 (3rd Quarter) ACCRA Cost of Living Index: 92.9 (U.S. average = 100.0)
State income tax rate: Ranges from 2.0% to 6.0%
State sales tax rate: 6.0% (groceries, medicines, and utility bills are exempt)
Local income tax rate: Averages 1.75%
Local sales tax rate: None
Property tax rate: Taxable property is assessed at 100% of the fair cash value of the property held on January 1. Rates per $100 of assessed valuation in 2003: State, $0.133; Jefferson County, $0.128; City of Louisville, $.3764; Jefferson County Schools, $0.5760.
Economic Information: Greater Louisville Inc., 614 West Main Street, Louisville, KY 40202; telephone (502)625-0000. Commonwealth of Kentucky, Department of Work-force Investment, Capital Plaza Tower, 500 Metro St., Frankfort, KY 40621-0001; telephone (502)564-6606.
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