Gov. Mike Beebe typically travels to a community when a $30 million deal that could create almost 1,000 jobs is being announced. But he did not attend such an announcement Friday in Fort Smith because the company expanding in Fort Smith is also the company that may move up to 400 jobs from North Little Rock to Memphis.
Officials with Fort Smith-based ArcBest Corp. announced Friday (May 30) the expansion of their corporate presence in the region with a $30 million plan that will see the construction of a new office building and data center at Chaffee Crossing and the addition of an estimated 975 corporate jobs by 2021.
News of the corporate expansion in Fort Smith comes as the company is considering consolidation of a majority of its North Little Rock terminal operation to a planned $20.5 million terminal expansion in Memphis. The move could cut up to 400 jobs from the North Little Rock operation.
As part of a cost-cutting move, ArcBest consolidated or closed eight terminals in 2013 and did the same with 22 terminals in the first quarter of 2014. ABF Freight now operates with 247 freight service centers.
“While there can be no assurances, annual expense savings associated with these network changes, which will fluctuate based on business levels and the profile and geographic mix of freight, are currently estimated to be in a range of $10 million to $12 million,” the company noted in its first quarter 10-Q filing with the U.S. Securities and Exchange Commission.
Grant Tennille, executive director of the Arkansas Economic Development Commission, attended the announcement in Fort Smith, and told The City Wire that it would have been “odd” for Beebe to be in Fort Smith as North Little Rock faces a major job loss. Tennille said the state is fighting to keep the jobs in Arkansas.
"Over the last year, ArcBest has either been consolidating or closing about two dozen of these terminals around the region," Tennille said in a Friday morning television interview with Roby Brock of Talk Business & Politics. "They have looked at whether or not the math makes sense for them to close North Little Rock and move those operations to Memphis. They have not made a final decision. We are working closely with them and have been talking about putting a retention package on the table to keep them here."
“The Governor feels fairly strongly that he represents all the constituents of Arkansas ... and he felt like it would just be odd” to be in Fort Smith celebrating new jobs while central Arkansas may soon lose up to 400 jobs, Tennille told The City Wire.
Tennille stressed that ArcBest was “not being punished” for its plans to move the jobs, and that Beebe realizes ArcBest has to make decisions that are in the best interests of the company and its shareholders. He also said Beebe is supportive of several efforts that may result in creating more jobs in the Fort Smith area.
“I am completely certain ... that I’ll be back here before the end of the year,” Tennille said.
A statement from Beebe’s office to Talk Business & Politics – a content partner with The City Wire – confirmed Tennille’s assessment of why Beebe did not attend ArcBest’s announcement.
"While we’re excited about ArcBest’s new headquarters and new jobs in Fort Smith, we’re still monitoring the potential (and unrelated) shutdown of another ArcBest-owned facility in North Little Rock," said Beebe spokesman Matt DeCample. "With those employees facing possible layoffs, Governor Beebe felt it wouldn’t be appropriate for him to personally be part of today’s announcement."
In the interview Talk Business & Politics, Tennille said the "real story" is the explosion of growth in technology jobs emerging from existing Arkansas firms not traditionally thought of as data driven.
"The real story is we keep seeing these businesses that historically we thought of as one thing – a trucking company – it's getting ready to hire 1,000 data analysts. Data is driving everything," said Tennille, who hinted that more announcements of this caliber may be in the works.