Advanced Business Services Profile

[Pages:10]Major Firms & Concentration

Major Advanced Business Services employers in Greater Phoenix include Fortune 500 companies such as Wells Fargo, American Express, Bank of America, Bank One and Conseco

The region is also home to many financial services operations including Discover Financial Systems, USAA, Chase Bankcard Systems, Conseco Finance Corp, and the Vanguard Group.

Major Advanced Business Services

Firms

Company Wells Fargo Bank One American Express Discover Financial Services USAA Chase Bankcard Systems U-Haul Blue Cross Blue Shield of AZ Conseco Finance Corp Vanguard Group Desert Schools Federal CU

Employment

8,800 7,600 7,223 4,100 2,500 2,000 1,400 1,332 1,250 1,100

700

Sources: Dunn & Bradstreet; Business Journal Book of Lists

Location of Advanced Business Services Firms in Greater Phoenix (with five or more employees)

Maricopa County Bu ck e ye

Employment Center Type

Existing

Future

Regional Airports

Phoenix Sky Harbor

Surpris eEl M iragPee oria Phoenix S cotts dale MLuukneicAipiraFl oAricrpeoBrtasse 303

CDGo odyearAvondalTeollGesleonndale CDCD17 Tem pe ChandleM reGs Cailbert 10

17 60 1 0 1 5 1 1 0 1 2 0 2

CD10

The Greater Phoenix Economic Council (GPEC) is a public-private economic development organization representing Maricopa County, 14 member communities, and over 150 businesses. Key functions include regional marketing, business attraction, and competitiveness improvement. GPEC leadership is made up of business and civic leaders with the common goal of strengthening the Greater Phoenix economy.

Avondale | Buckeye | El Mirage | Chandler | Gilbert Glendale | Goodyear | Mesa | Peoria | Phoenix

Scottsdale | Surprise | Tempe | Tolleson | Maricopa County

For information about GPEC call (800)421-4732.

4

Advanced Business Services

Industry Overview - Greater Phoenix

The Advanced Business Services cluster includes financial institutions in the credit, lending, collections, investments, and brokerage sectors. The industry includes general office, data centers, regional and corporate headquarters operations. Employers in this cluster include customer contact centers, data processing centers, financial institutions, insurance companies, and real estate firms.

Greater Phoenix Advantages

Critical Mass: ? Greater Phoenix has a well-established base of firms

in the advanced business services industry, including Wells Fargo, Bank One, American Express, Discover Financial Services, DHL Worldwide Express and USAA. The industry is now positioned to increase its effectiveness in higher-value business services.

Talent: ? Employers in the area have access to a talented

administrative, executive, and professional workforce.

Education: ? Greater Phoenix has a number of colleges and

universities that offer programs of study in many aspects related to business services.

Recent Market Developments

? William P. Carey recently donated $50 million to the College of Business at ASU. The College produces a significant number of the graduates in the advanced business services cluster.

? Many advanced business services companies, such as AGL Networks and Pacific Texas, have recently located to Greater Phoenix.

? Job growth in Greater Phoenix is expected to increase faster than the rest of the western region, growing more than 2% in 2003 and 3% in 2004.

Industry Characteristics

Companies

Finance, Insurance and Real Estate 3,022

Services

7,227

Companies by Type (percent)

Headquarters

6.0%

Branch

22.6%

Single Location

71.4%

Number of Employees

140,763

Company Average

14

Total Payroll (millions)

$7,468.4

Company Average

$0.7

Average Wages Per Employee

$53,057

Sources: Dunn & Bradstreet, Q2 2003; IMPLAN; Maricopa Association of Governments, April 2002

Employment Growth

Thousands

150

100

71% Growth, 1990-2000

82,519

50

140,763

0

1990

2000

Source: Maricopa Association of Governments; IMPLAN, April 2002

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1

Growth Trends

Advanced Business Services-Related Industries

Advanced Business Services industries in Greater Phoenix employ over 140,000 people in over 10,000 firms. This represents a 71% increase in Advanced Business Services employment since 1990. ? The services sector comprises 39% of all

employment in Advanced Business Services, up from 24% in 1990.

? Non depository credit institutions have increased by 399% since 1990 and now employ 18% of the Advanced Business Services industry.

? Management and public relations account for 25% of the establishments in the Advanced Business Services industry.

Industry

Employment Employment Growth

2000 1990-2000

Depository institutions

29,820

Non depository credit institutions

26,501

Insurance carriers

18,095

Management and public relations

17,169

Engineering services

10,567

Legal services

10,107

Accounting, auditing, & bookkeeping

9,951

Security & commodity brokers

8,642

Advertising

3,727

Holding & other investment offices

2,764

Security Systems Services

1,025

Commercial Art and Graphic Design

936

Direct Mail Advertising Services

563

Services, nec*

552

Commercial Photography

221

News Syndicates

123

Total

140,763

*nec ? not elsewhere classified

Sources: Maricopa Association of Governments; IMPLAN, April 2002

13% 399% 34% 137% 73%

1% 75% 236% 85% 105% 78% 42% -38% 188% 80% 356% 71%

Average Wages 2000

$39,995 $38,430 $43,547 $53,356 $58,136 $68,608 $38,829 $75,962 $236,418 $64,988 $35,499 $42,735 $37,317 $56,912 $36,612 $40,941 $53,057

Establishments 2000

749 932 454 2,572 859 1,665 1,169 589 462 298 68 187 48 135 56

6 10,249

? Advanced Business Services jobs in Greater Phoenix have an average salary of $53,057.

Source of Receipts

? The primary source of receipts in the Advanced Business Services industry is income generated from interest. This comprises more than 31% of the receipts in this industry.

? Another large source of revenue comes from insurance premiums. Premiums earned from insurance represent 30% of the value of receipts in this industry.

? Receipts, fees, and revenue for the practice of law account for more than $112 billion and 5.5% of the receipts in this industry.

Advanced Business Services- U.S. Supplier Industries

Industries

Value of Percent Receipts (000s) of Total

Interest Income

$640,723,322

Property and Casualty Insurance Premiums Earned

$244,198,808

Accident, Health, and Medical Insurance Premiums Earned $227,568,596

Other Investment Income

$211,707,040

Annuity Revenue

$122,028,916

Life Insurance Premiums Earned

$116,474,656

Net Gains in Trading Accounts in Securities and Commodities $68,229,543

Receipt, Fees, or Revenue from Individuals for

$60,352,191

the Practice of Law

Insurance and Annuity Commissions

$59,260,842

Management Consulting

$53,667,781

Receipt, Fees, or Revenue from Businesses for

$51,785,190

the Practice of Law

Securities Commission

$49,649,890

Other Revenues

$48,163,713

Assets/Portfolio Management Fees

$45,428,534

Reinsurance Premiums

$39,686,407

Total

$2,038,925,429

31.4% 12.0% 11.2% 10.4% 6.0% 5.7% 3.3% 3.0%

2.9% 2.6% 2.5%

2.4% 2.4% 2.2% 1.9% 100.0%

Source: Source of Receipts, Census Bureau, August 2000

2

Community Readiness

Critical Site Factors

Extremely Access to Business/Professional/Technical Services

Critical

Access to Telecommunication Services Built Space Availability

Capital Availability

Energy Dependability

Personal/Property Security

Secondary Education Quality

Greater Phoenix is well-positioned in extremely critical site factors such as energy dependability, real estate availability and cost, and access to support services.

Very Critical

Administrative/Executive/Professional Workforce Area Image Built Space Cost Business Taxes Climate Geographic Proximity to Markets Higher Education Quality Housing Costs/Cost of Living Local Transportation

Favorable geographic proximity and climate, as well as low taxes and cost of living, make the region attractive to employers in advanced business services.

Critical

Cost of Skilled and Unskilled Workers Recreational and Cultural Opportunities Technical Workforce

With competitive labor costs and a large pool of available workers, Greater Phoenix supports a growing advanced business services cluster.

Source: Maricopa Association of Governments; IMPLAN, September 2002

Workforce Development

Job training for professions in advanced business services industries is available through Arizona State University and the Maricopa Community Colleges System.

Arizona State University

? Bachelors, masters, and PhD programs available in business disciplines including accountancy, computer information systems, economics, finance, management, marketing, real estate, and supply chain. ASU graduated 1,302 students in all business disciplines in the 2001-2002 school year.

Maricopa Community Colleges ? Offers associate in applied science degrees in many areas including

business management, database administration, general business, multimedia, organizational leadership, and real estate.

? Transfer partnership degrees available in accounting and global business. These degrees allow the student to transfer directly to ASU to complete a bachelors degree.

? Certificates of completion available in fields including bank teller, bookkeeping, computer graphic design, desktop publishing, microcomputer applications, organizational leadership, total quality management, and web developer.

Selected Advanced Business Services Occupations

Occupations

Employment*

Management:

(rounded)

Chief Executives/General

28,090

Advertising/Marketing

4,500

Administrative Services Financial Human Resources

3,960 7,620 3,060

Business and Financial Operations:

Adjusters, Appraisers, Cost Estimators 6,490

Employment, Training, and Compensation 6,260

Management Analysts

6,830

Accountants and Auditors

11,670

Budget, Credit, and Financial Analysts 8,390

Underwriters

1,710

Office and Administrative Support:

Bill and Account Collectors

10,640

Payroll and Bookkeeping Clerks

23,790

Tellers

4,450

Brokerage Clerks

760

Loan Interviewers and New Account Clerks 3,340

Insurance Claims Clerks

3,560

Source: Arizona Department of Economic Security, 2001 *Greater Phoenix

3

Major Firms & Concentration

Major aerospace employers in Greater Phoenix include Fortune 500 companies such as Boeing, General Dynamics, and Honeywell

The region is also home to large airline operations including Southwest Airlines, Mesa Air Group, and the headquarters of America West Airlines

Many aerospace firms are concentrated along major regional freeway corridors or near local airports

Major Aerospace Firms

Company

Honeywell America West Airlines The Boeing Company Southwest Airlines General Dynamics Mesa Air Group Orbital Sciences Corporation Spectrum Astro Incorporated MD Helicopters, Inc. Goodrich Corporation Universal Propulsion Company

Employment

17,280 9,300 4,300 1,800 1,200

850 530 313 300 300 270

Sources: Applied Economics; Dunn & Bradstreet

Location of Aerospace Firms in Greater Phoenix (with five or more employees)

Maricopa County

Buck e ye

Buckeye Airport

Employment Center Type

Existing

Future

Regional Airports

Phoenix Sky Harbor

Phoenix Deer Valley Airport

Scotts dale

Municipal Airports

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Ch a nd le r

Chandler Airport

Mesa-Williams Gateway Airport

The Greater Phoenix Economic Council (GPEC) is a public-private economic development organization representing Maricopa County, 14 member communities, and over 150 businesses. Key functions include regional marketing, business attraction, and competitiveness improvement. GPEC leadership is made up of business and civic leaders with the common goal of strengthening the Greater Phoenix economy.

Avondale | Buckeye | El Mirage | Chandler | Gilbert Glendale | Goodyear | Mesa | Peoria | Phoenix

Scottsdale | Surprise | Tempe | Tolleson | Maricopa County

For information about GPEC call (800)421-4732.

4

Aerospace Industry Overview

Greater Phoenix

The aerospace cluster includes manufacturing firms involved in the production of aircraft, aircraft engines, guided missiles, space vehicles, space vehicle propulsion units, as well as search and navigation equipment. Service sector operations include air transportation and courier services, airport and terminal services, and aircraft repair facilities.

Greater Phoenix Advantages

Critical Mass: ? Greater Phoenix has a well-established base of firms

in the aerospace manufacturing and services industries, including Boeing, MD Helicopters, General Dynamics, and America West and Southwest Airlines.

Global Leader: ? Sky Harbor International Airport is the fifth busiest

airport in the world for takeoffs and landings, with 550,000 arrivals and departures annually.

Diverse Choices: ? A network of eight municipal airports, including military

reuse facilities, with available space to expand.

Reliable Conditions: ? 300 days of sunshine each year make Greater Phoenix

the perfect climate for flight operations.

Recent Market Developments

? Williams Gateway Airport in Mesa has recently opened an on-site U.S. Customs inspection facility in anticipation of future growth in operations.

? Lockheed Martin has located its Tactical Ground Systems Business Unit to Phoenix-Goodyear Airport.

? America West Airlines recently introduced a new fare structure easing advance-purchase requirements and eliminating Saturday-night stays.

? The effects of September 11th and war with Iraq will likely provide considerable potential for the defenserelated aerospace industry in Greater Phoenix.

MD Helicopters Inc. Production Facility (Mesa)

Lockheed Martin Facility (Goodyear)

Industry Characteristics

Companies Manufacturing Non-Manufacturing

Companies by Type (percent) Headquarters Branch Single Location

Number of Employees Company Average

Total Payroll (millions) Company Average

Average Wages Per Employee

148 820

5.1% 12.3% 82.6% 54,745

57 $2,622.2

$2.7 $47,898

Sources: Dunn & Bradstreet, Q2 2003; Maricopa Association of Governments; IMPLAN, April 2002

Employment Growth

Thousands

56

52

19% Growth, 1990-2000

54,745

48

45,859

44

40

1990

2000

Source: Maricopa Association of Governments; IMPLAN, April 2002

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1

Growth Trends

Aerospace-Related Industries

Aerospace industries in Greater Phoenix employ over 54,000 people in over 900 firms. This represents 19% growth in aerospace employment since 1990 and 13% growth in establishments since 1995.

? Aerospace manufacturing is 45% of all Aerospace employment, down from 61% in 1990.

? Aircraft manufacturing, including aircraft parts and engines, accounts for 33% of Aerospace employment.

? The Airline industry employs an additional 30%.

? Aerospace jobs in Greater Phoenix have an average salary of $47,898.

Industry

Employment

Employment Growth

2000

1990-2000

Air transportation, scheduled Aircraft engines and engine parts Aircraft parts and equipment, nec* Air courier services Search and navigation equipment Aircraft Airports, flying fields, & services Repair services, nec* Freight transportation arrangement Air transportation, nonscheduled Guided missiles and space vehicles Space vehicle equipment, nec* Automotive dealers, nec* Space propulsion units and parts Iron and steel forgings Nonferrous forgings Total

16,392 8,216 6,226 5,767 5,035 4,059 3,079 2,264 1,688

653 543 340 333 107 40

3 54,745

41% -14% 28% 497% -34% -16% 43% 33% 25% 483%

2% 34% 72% 5,250% 122% -73% 19%

*nec ? not elsewhere classified Sources: Maricopa Association of Governments; IMPLAN, April 2002

Average EstablishWages ments 2000 2000

$43,466

44

$61,576

38

$52,734

70

$31,233

46

$65,308

12

$55,302

13

$32,237

80

$36,159 376

$36,856 199

$40,046

40

$73,342

1

$45,363

9

$31,663

35

$46,652

1

$43,297

3

$9,658

1

$47,898 968

Supplier Industries

? All major aerospace supplier industries have a presence in the Greater Phoenix market.

? The region is especially strong in electronic industries that are suppliers to aerospace manufacturing.

? This includes the electronic components sector with more than 38,000 employees, and computer and data processing (software) with a workforce of nearly 5,000.

? Under-represented suppliers are mainly in primary and fabricated metals industries, which are resourcedependant and unlikely to concentrate in Greater Phoenix.

Growing and Contracting Aerospace-Supplier Industries

Growing Industries Computer and Data Processing Iron and Steel Forging Rolling, Drawing, and Extruding

nonferrous metals Electronic Components Electric Utilities Services

Employment Growth

1990-2000

242% 122%

29% 22% 4%

Employment 2000

4,852 40

Establishments 2000

138 3

2,920

17

38,971

139

6,145

4

Contracting Industries

Aircraft and Parts

-4%

18,501

121

Measuring and Controlling Devices

-7%

3,085

56

Search and Navigation Equipment

-33%

5,035

12

Nonferrous Forgings

-72%

3

1

Aluminum Castings

-79%

53

1

Sources: Maricopa Association of Governments; IMPLAN, April 2002

2

Community Readiness

Critical Site Factors

Extremely Cost of Skilled Workers

Critical

Cost of Unskilled Workers Energy Dependability

Unemployment Insurance

Workers Compensation

Greater Phoenix is well-positioned in extremely critical site factors for aerospace industries

Very Critical

Access to Intermediate Manufactured Products Access of Professional/Specialty Workforce Built Space Availability Built Space Cost Regulatory Policies

A well-established suppler network and available real estate makes the region attractive for aerospace

Critical

Access to Executive/Administrative Workforce Access to Precision Production/Technical Workforce Access to Telecommunications Services Business Incentives/Taxes Capital Availability Climate/Physical Environment Geographic Proximity to Markets Land Availability/Cost Local Transportation/Commuting Personal/Property Security

Source: Maricopa Association of Governments, September 2002

Favorable climate and geography makes Greater Phoenix wellsuited to aerospace operations, and land is available with access to suitable infrastructure for future growth

Regional Airports

Airport

Phoenix Sky Harbor Intl. Mesa-Williams Gateway Phoenix Goodyear Scottsdale Phoenix Deer Valley Glendale Mesa-Falcon Field Chandler Buckeye

Runway Length

11,490 10,401 8,500 8,249 8,208 5,350 5,102 4,850 4,300

Sources: AirNav; Phoenix Aviation Department

The Greater Phoenix region has eight municipal airports in addition to Sky Harbor International

Workforce Development

Job training for professions in the aerospace industry is available through Arizona State University, the Maricopa Community Colleges System, and several local flight training schools.

Arizona State University

? Bachelors, masters, and PhD programs available in engineering disciplines including aerospace, mechanical, electrical, and computer science. 935 engineering graduates in all disciplines in 2000-2001.

Maricopa Community Colleges

? Offers associate in applied science degrees in aerospace manufacturing, aircraft construction and maintenance technology, aviation maintenance, airway science, and machinist professions.

? Certificates of completion available in fields including airframe maintenance, avionics, composite, and flight technology, machinist, sheet metal structures technology, and NIMS (National Institute for Metalworking Skills) Certification.

Flight Training

? Available from schools including Embry Riddle University, University of North Dakota, Westwind Aviation, and Advanced Training Systems International.

Selected Aerospace Occupations

Professional Occupations Engineers: Computer Applications Computer Systems Software Computer Systems Analysts Electrical Electronics Industrial Mechanical General & Operations Managers

Employment* (rounded)

3,940 3,280 6,670 3,620 4,880 2,480 2,580 21,430

Production & Maintenance Occupations Aircraft Structure Assemblers Electrical & Electronic Installers Electromechanical Equip. Assemblers Inspectors & Testers Machinists Technicians: Aircraft Mechanics & Service Avionics

780 230 380 5,100 3,300

1,910 450

Source: Arizona Department of Economic Security, 2001 * Greater Phoenix

3

Growth Trends

Bio-Related Industries

Bioindustries in Greater Phoenix employ over 8,700 people in over 950 firms. This represents 83% growth in bioindustry employment since 1990 and 23% growth in the number of establishments since 1995.

? Equipment and chemical/drug manufacturing accounts for over 29% of regional bioindustry employment.

? Bioindustry jobs in Greater Phoenix have an average salary of $49,886.

? Greater Phoenix has a large concentration of surgical and medical instrument manufacturing firms, with employment growing over 1,000% from 1990 - 2000.

Industry

Employment

Employment Growth

2000

1990-2000

Medical and hospital equipment

2,739

Testing laboratories

1,712

Commercial physical research

856

Pharmaceutical preparations

795

Electromedical equipment

631

Medical equipment rental

439

Industrial inorganic chemicals, nec* 375

Noncommercial research organizations 274

Professional equipment, nec*

207

Surgical appliances and supplies

185

Medicinals and botanicals

170

Surgical and medical instruments

96

Analytical instruments

73

Chemical preparations, nec*

72

Dental equipment and supplies

64

Industrial organic chemicals, nec*

56

Biological products exc. diagnostic

43

Laboratory apparatus and furniture

3

Total

8,790

59% 144% 159% 81% 31,450% 100% 191% 47% -49% 208% -48% 433% 83% -47% 237% 2,700% 59%

N/A 83%

*nec ? not elsewhere classified Sources: Maricopa Association of Governments; IMPLAN, April 2002

Average EstablishWages ments 2000 2000

$58,253 518

$39,179 130

$57,588

67

$52,488

13

$49,150

6

$33,334

25

$46,890

6

$52,116

59

$54,405

72

$43,463

20

$38,693

9

$46,954

8

$57,292

6

$50,648

5

$30,982

8

$23,033

3

$41,430

3

$20,215

1

$49,886 959

Supplier Industries

? Most major bioindustry supplier sectors have a presence in the Greater Phoenix market.

? Of these supplier industries, the top ten located in Greater Phoenix have all grown from 1990 to 2000.

? The region is especially strong in the electronic and other electrical equipment & components sector with more than 42,000 employees.

? Transportation firms have a large base in Greater Phoenix, with close to 900 establishments in 2000.

Biotech-Supplier Sectors

Industries

Employment 2000

Employment

Growth Establishments

1990-2000

2000

Advertising

3,727

85%

462

Drugs

1,008

19%

25

Dyeing and Finishing Textiles

4

300%

3

Electronic & Other Electrical

Equipment & Components

42,843

19%

261

Industrial Inorganic Chemicals

585

135%

10

Industrial Organic Chemicals, nec*

56

2,700%

3

Miscellaneous Plastics Products

4,818

41%

123

Paperboard Containers & Boxes

767

70%

10

Surgical Appliances & Supplies

185

208%

20

Trucking & Courier Services

14,909

36%

897

*nec ? not elsewhere classified Sources: Maricopa Association of Governments; IMPLAN, April 2002

2

Community Readiness

Critical Site Factors

Extremely Critical

Energy Dependability Venture Capital Availability Built Space Cost Regulatory Policies Business Taxes

Greater Phoenix is well-positioned in extremely critical site factors for bioindustry such as energy dependability and built space costs

Very Critical

Intermediate Manufactured Products Business/Professional/Technical Services Cost of Skilled/Unskilled Workers Land Cost Built Space Availability Debt Availability Workers Comp/Unemployment Insurance

A growing suppler network and a highquality talent pool for bioindustry makes the region attractive

Critical

Geographic Proximity Transportation Services - Cost Executive, Administrative, Professional Workforce Workforce Availability Land Availability - Improved Secondary Education Quality Local Transportation/Commuting Personal/Property Security Climate/Physical Environment

Source: Maricopa Association of Governments; IMPLAN, September 2002

The region's geographic proximity, climate, and infrastructure is wellsuited to support continued growth the bioscience sector, and Greater Phoenix has a well-educated workforce with continuous support from surrounding colleges and universities

Workforce Development

Job training for professions in bioindustry is available through Arizona State University and the Maricopa Community Colleges.

Arizona State University

? Bachelors, masters, and PhD degrees are available in ASU's bioengineering program. The university graduated 55 bioengineers in the 2001-2002 school year, more than 93% of the total for the state of Arizona. ASU also has a Clinical Laboratory Sciences program and the ASU College of Nursing.

? ASU's Arizona Biodesign Institute is a state-of-the-art research facility focusing on the life sciences, bioengineering and biotechnology. The ASU Cancer Research Institute has also been conducting experiments for over 38 years in search for a cure.

Maricopa Community Colleges

? The Maricopa Community Colleges offer Associate of Applied Science degrees and certificates in Biotechnology, Clinical Research Coordinator, Histology Technician, and Laboratory Assisting. In addition, foundational courses in general science, biology, chemistry, and math are also offered.

The Maricopa Community Colleges recognize the potential growth in the bioindustry sector and are committed to continue developing additional bioscience programs and curriculum to meet the future demands of this rapidly evolving industry.

Selected Bioindustry Occupations

Professional & Sales Occupations Employment*

Engineers:

(rounded)

Chemical

110

Electrical

3,620

Electronics, ex. computers

4,880

Chemists

260

Life Scientists, all other

150

Mathematical Scientists

20

Medical Scientists, ex. Epidemiologists

260

Microbiologists

70

Natural Science Managers

300

Sales and Related Occupations

171,310

Sales Managers

5,700

Production & Maintenance Occupations Assemblers & Fabrications, all other Chemical Equipment Operators & Testers Chemical Plant & System Operators Electrical & Electronic Equip. Assemblers Inspectors & Testers Packaging & Filling Machine Operators

1,780 200 20

3,790 5,100 1,440

Source: Arizona Department of Economic Security, 2001 * Greater Phoenix

3

Major Firms & Concentration

Major bioscience employers in Greater Phoenix include Fortune 1000 companies such as Medtronic, Laboratory Corporation of America, and St. Jude Medical

The region is also home to several large hospitals including the Mayo Clinic, Good Samaritan, Thunderbird Samaritan, St. Joseph's Hospital, and the Arizona Heart Institute

Major Bioindustry Firms

Company

Top Ten Hospitals Medtronic Microelectronics Center Sonora Quest Laboratories Laboratory Corporation of America Ralph T Bohrer Blood System Laboratories Steris Laboratories GE Parallel Design Inc. St. Jude Medical Inc. Vantage Mobility

Employment

26,029 950 783 405 400 300 240 205 200 200

Sources: Applied Economics; Dunn & Bradstreet

Location of Biotech Firms in Greater Phoenix (with five or more employees)

Employment Center Type

Existing Future

Regional Airports

Phoenix Sky Harbor

Sco t ts d ale

Municipal Airports

Luke Air Force Base

Pe o r ia

101

Maricopa County Bu ck e ye

CD10

Go

o30S3duyreparriA sveEolnMdiarlae T goe l l Ge sl eo nn d a l e CD 1 7 CD 17P h o e n i x5 1 T e m p e 101 M 2 02eG s Cia6l0be

r

t

Chandler

CD10

The Greater Phoenix Economic Council (GPEC) is a public-private economic development organization representing Maricopa County, 14 member communities, and over 150 businesses. Key functions include regional marketing, business attraction, and competitiveness improvement. GPEC leadership is made up of business and civic leaders with the common goal of strengthening the Greater Phoenix economy.

Avondale | Buckeye | El Mirage | Chandler | Gilbert Glendale | Goodyear | Mesa | Peoria | Phoenix

Scottsdale | Surprise | Tempe | Tolleson | Maricopa County

For information about GPEC call (800)421-4732.

4

Bioindustry Overview

Greater Phoenix

The Bioindustry cluster includes businesses that provide products and services focusing on life science activities (excluding healthcare delivery) such as medical and surgical devices, pharmaceuticals, medical technology, research, and testing.

Greater Phoenix Advantages

Commitment to Bioindustry: ? The Greater Phoenix region has made a significant

investment in the growth of the bioindustry sector, from efforts to attract top companies to the formation of research organizations to support the biosciences.

Available Talent: ? A workforce of 1.7 million and university investment in

bioindustry is creating a high-quality talent pool.

Strength in Bio-related Industries: ? Greater Phoenix has strong electronics, information,

optics, and materials clusters to support the growing bioindustry sector in the region.

Recent Market Developments

? The International Genomics Consortium (IGC) has chosen the City of Phoenix as the location of its new research facility. IGC will elevate the status of bioindustry in the region with its medical research expanding upon the Human Genome Project.

? The Translational Genomics Research Institute (TGen) was formed by several statewide organizations to provide necessary funding and support for the continue growth of bioindustry in Arizona.

? Batelle issued a Biosciences Roadmap report to define the current state of the industry in Arizona and pinpoint specific strategies the state can take to grow certain bioindustry niches.

? Arizona State University is currently in Phase I of the Arizona Biodesign Institute research complex, constructing the first of a planned five buildings, expected to be complete in fall 2004.

ASU's Arizona Biodesign Institute

(Tempe)

Industry Characteristics

Companies Manufacturing Non-Manufacturing

Companies by Type (percent) Headquarters Branch Single Location

Number of Employees Company Average

Total Payroll (thousands) Company Average

Average Wages Per Employee

88 871

8.6% 20.3% 71.1% 8,790

9.2 $438,495.2

$457.2 $49,886

Sources: Dunn & Bradstreet, Q2 2003; Maricopa Association of Governments; IMPLAN, April 2002

Employment Growth

Thousands

12

83% Growth,

1990-2000

8,790

8

4,816

4

0

1990

2000

Source: Maricopa Association of Governments; IMPLAN, April 2002

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1

Major Firms & Concentration

Major High Tech employers in Greater Phoenix include Fortune 500 companies such as Intel, Motorola, Medtronic, and Sanmina-SCI

The region is also home to other high tech companies such as ON Semiconductor, Encompass Electrical Technologies, Suntron Corp., ST Microelectronics, AG Communication Systems, and Varian Electronics Manufacturing.

Major High Tech Firms

Company

Intel Motorola General Dynamics Microchip Technology ON Semiconductor Medtronic Microelectronics Encompass Electrical Technologies Suntron Corp. ST Microelectronics Inc AG Communications Systems Varian Electronics Manufacturing Sanmina-SCI Phoenix DHL Worldwide Express

Employment

10,000 10,000 3,000 1,452 1,300 1,200

900 900 842 800 800 750 650

Sources: Dunn & Bradstreet; Business Journal Book of Lists

Location of High Tech Firms in Greater Phoenix (with five or more employees)

Maricopa County Bu ck e ye

Employment Center Type

Existing

Future

Regional Airports

Phoenix Sky Harbor

Scott s d ale

Municipal Airports

CD1G0 o 3o0S3duyreparriAsveE olnMdiar laTegPoeell Geosrleioa nn d a le 1 0 1 CD 1 7 CD 1 7P h o e n i x5 1 T e m p e 1 0 1 C h a n d l e M 2 0r 2eGs C ai6 l 0 ber

Luke Air

t

Force

Base

CD10

The Greater Phoenix Economic Council (GPEC) is a public-private economic development organization representing Maricopa County, 14 member communities, and over 150 businesses. Key functions include regional marketing, business attraction, and competitiveness improvement. GPEC leadership is made up of business and civic leaders with the common goal of strengthening the Greater Phoenix economy.

Avondale | Buckeye | El Mirage | Chandler | Gilbert Glendale | Goodyear | Mesa | Peoria | Phoenix

Scottsdale | Surprise | Tempe | Tolleson | Maricopa County

For information about GPEC call (800)421-4732.

4

High Tech Overview

Greater Phoenix

The High Tech cluster includes the computer hardware, electronic equipment, semiconductor, telecommunications, and related industries. These industries develop, manufacture, and distribute products such as office equipment, measuring and controlling devices, circuit boards and associated items to the market.

Greater Phoenix Advantages

Critical Mass: ? Greater Phoenix has a well-established base of firms

in the high tech industry, including Intel, Motorola, Microchip Technology, and ON Semiconductor. The industry is now positioned to increase its effectiveness in higher-value business services.

Talent: ? Employers in the area have access to a large pool of

talented administrative, executive, and professional workforce, including those trained in business, professional and technical services.

Education: ? Greater Phoenix has a number of colleges and

universities that offer programs of study in many aspects related to High Tech. Land: ? Large amounts of land are available to High Tech companies for industrial development.

Recent Market Developments

? Many High Tech companies, such as Isola and Nikon SITECH, have recently located to Greater Phoenix.

? Employment in semiconductor manufacturing, which comprises one-third of Arizona's High Tech manufacturing employment, is expected to grow 6.5% by 2008.

? Many companies, such as Intel and ON Semiconductor are expanding operations due to increased demand.

Industry Characteristics

Companies Manufacturing Transportation and Utilities

Companies by Type (percent) Headquarters Branch Single Location

Number of Employees Company Average

Total Payroll (millions) Company Average

Average Wages Per Employee

253 298

5.8% 22.0% 72.2% 60,158

109 $4,177.3

$7.6 $69,439

Sources: Dunn & Bradstreet, Q2 2003; IMPLAN; Maricopa Association of Governments, April 2002

Employment Growth

Thousands

75

50

20% Growth,

1990-2000 60,158

50,030

25

0

1990

2000

Source: Maricopa Association of Governments; IMPLAN, April 2002

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Growth Trends

High Tech-Related Industries

High Tech industries in Greater Phoenix employ over 60,000 people in over 550 firms. This represents 20% in High Tech employment since 1990.

? Semiconductors and related devices manufacturing comprises over 50% of all employment in High Tech and has an average wage of $85,707.

? Electronic connector manufacturing has increased by 171% since 1990 and now employs 2% of the High Tech industry.

? Telephone communications account for 54% of the establishments and 25% of the employees in the High Tech industry.

? High Tech jobs in Greater Phoenix have an average salary of $69,439.

Employment

Industry

Employment Growth

2000

1990-2000

Semiconductors and related devices Telephone communications Printed circuit boards Environmental controls Computer and office equipment Electronic connectors Communications equipment Electronic components, nec Instruments to measure electricity Process control instruments Electronic coils and transformers

32,088 15,272 4,116 1,906 1,599 1,425 1,372 1,110

419 417 150

16% 59% 70% 16% -61% 171% 14% -5% 124% 5% 8%

Measuring and controlling devices, nec 83

-79%

Electronic capacitors

82

0%

Storage batteries

66

0%

Engine electrical equipment Magnetic and optical recording media Fluid meters and counting devices Primary batteries, dry and wet Total

29 12 8 4 60,158

-85% -70% 300%

0% 20%

Sources: Maricopa Association of Governments; IMPLAN, April 2002

*nec ? not elsewhere classified

Average Wages 2000

$85,707 $51,003 $37,663 $69,091 $60,674 $63,135 $59,401 $34,601 $50,074 $47,107 $20,416 $46,111 $37,849 $36,551 $15,238 $44,723 $58,158 $33,906 $69,439

Establishments 2000

59 298 39

3 28 7 32 27 18 15 6 7 1 1 4 2 3 1 551

Supplier Industries

? Most major high tech supplier industries have a presence in the Greater Phoenix market.

? The region is especially strong in the Semiconductor and Related Devices sector. The industry employs over 32,088 employees.

? Miscellaneous Plastic Products firms, with 123 establishments in 2000, have a large base in Greater Phoenix.

? Industrial Chemicals, both organic and inorganic, have shown substantial gains in employment from 1990 to 2000.

High Tech- U.S. Supplier Industries

Industries

Employment Growth

1990-2000

Industrial Organic Chemicals Fluid Meters & Counting Devices Radio & TV Communications Equipment Industrial Inorganic Chemicals Instruments to Measure Electricity Relays & Industrial Controls Metal Stamping, nec* Miscellaneous Plastic Products Semiconductors & Related Devices Plating & Polishing Electronic Components, nec* Computer Peripheral Equipment, nec* Electronic Computers

2,700% 300% 177% 135% 124% 122% 105% 41% 16% 15% -5% -28% -67%

Source: Maricopa Association of Governments; IMPLAN, April 2002 *nec-not elsewhere classified

Employment

2000

56 8 1,023 585 419 111 713 4,818 32,088 843 1,110 332 973

Establishments 2000

3 3 19 10 18 7 14 123 59 37 27 14 11

2

Community Readiness

Critical Site Factors

Extremely Built Space Cost

Critical

Energy Dependability Workers Compensation

Unemployment Insurance

Greater Phoenix is well positioned in extremely critical site factors such as low unemployment insurance and energy dependability.

Very Critical

Built Space Availability Business, Professional, and Technical Services Business Taxes and Regulatory Policies Climate Cost of Skilled and Unskilled Workers Debt Availability Land Cost Secondary Education Quality Technical Workforce

Favorable climate, as well as low land cost and cost of workers, make the region attractive to High Tech employers. In addition, the region has built space and debt capital available.

Critical

Executive, Administrative and Professional Workers Local Transportation Services and Commuting Cost Precision Product and Repair Operators and Assemblers Personal and Property Security Telecommunication Services Venture Capital Availability

Source: Maricopa Association of Governments; IMPLAN, September 2002

With developed telecommunication services and a large pool of available workers, Greater Phoenix supports the High Tech cluster.

Workforce Development

Job training for professions in high tech industries is available through Arizona State University and the Maricopa Community Colleges System.

Arizona State University ? Bachelors, masters, and PhD programs available in engineering

including electrical and industrial engineering. ASU graduated 818 students in all engineering disciplines in the 2001-2002 school year.

Maricopa Community Colleges ? Offers associate in applied science degrees in many areas including,

applied technology, computer networking technology, electric utility technology, electromechanical process technology, electronics technology, and semiconductor technician programs.

? The Maricopa Advanced Technology Education Center (MATEC) is a National Center for Excellence and educates and enhances workforce development in the semiconductor industry.

? Certificates of completion available in fields including applied technology, computer hardware, desktop support, electrical technology, local area networking microcomputer applications, and Microsoft networking technology.

Selected High Tech Occupations

Employment*

Professional Occupations

(rounded)

Computer Programmers

7,400

Engineers:

Electrical Engineers

3,620

Electronic Engineers, except computer

4,880

Engineering Managers All Other Engineers First Line Supervisors of Mechanics Sales and Related Occupations

3,790 1,870 4,840 171,310

Production & Maintenance Occupations

Assemblers:

Electrical & Electronic Equipment Assembler 3,790

All Other Assemblers

1,780

Electrical & Electronic Technicians

8,150

Industrial Machinery Mechanics

920

Inspectors, Testers, Sorters, & Samplers 5,100

Packaging & Filling Machine Operators

1,440

Source: Arizona Department of Economic Security, 2001 *Greater Phoenix

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