Community ProfileManufactures - South ; Federal Reserve District, 8th ; Mississippi

Susan C. Thomson

English

Research Papers in Economics

P
ablo Diaz, executive director of the Grenada County Economic 
Development District in Grenada, Miss., proudly calculates  
that about 30 percent of local jobs are in manufacturing.  That’s 
astonishing at a time when that slumping sector accounts for only 
about 8 percent of jobs nationally, according to the Bureau of  
Labor Statistics. 
Grenada’s manufacturing prowess can be chalked up chiefly to the 
staying power of a single enterprise established in town in the mid-
1950s.  A Minnesota company, attracted by the South’s relatively 
low production costs, hired a handful of employees to make coils for 
heating, ventilating and air-conditioning applications.
Pro-Business Mississippi Town 
Bucks Manufacturing Trend
Story and photos by Susan C. Thomson
At Luvata, a maker of commercial and 
industrial coils, James Jones brazes 
together an assembly to be installed on a 
coil.  Luvata is Grenada’s largest employer. 
18   The Regional Economist  |  January 2012
coMMuniTy ProfileCoils consist of tubing (typically copper) 
sandwiched in metal (typically aluminum).  
Over the years, they have come in ever  
more sizes and shapes for ever more resi-
dential, commercial and industrial temper-
ature-control uses.  Grenada (pronounced 
gre-NAY-dah) is fortunate today in having 
landed an early piece of what became a 
growth industry.
“It just got bigger and bigger,” recalls 
Buddy Harbin, interim director of the Gre-
nada Area Chamber of Commerce.
As the original plant grew, it went through 
a number of out-of-town owners and result-
ing name changes.  It eventually evolved 
into two companies—Advanced Distributor 
Products (ADP) and Luvata.  The former, 
owned by Lennox International Inc., makes 
coils for residential applications.  The latter, a 
unit of a private European investment firm, 
serves the commercial and industrial mar-
kets.  Together, the two companies account 
for 20 percent of Grenada’s jobs, Diaz says.
Where industrial development led, com-
mercial development followed.  Jimmy Brown, 
Grenada-based president of Regions Bank’s 
North Mississippi area, describes the town 
today as a trading center, drawing custom-
ers from up to 50 miles away.  Wal-Mart, a 
presence there since the early 1980s and now a 
24-hour-a-day supercenter, is an obvious draw.   
Unusually for a town so small, Grenada also 
boasts seven auto dealers and a large farm-
equipment dealer, Brown points out.
The 156-bed Grenada Lake Medical Center 
is yet another regional asset, serving patients 
from Grenada County plus eight surround-
ing ones, according to the chief executive, 
Charles “Chip” Denton.  In early 2009, the 
county-owned facility completed $20 million 
worth of construction.  That price tag covered 
the renovation of 20,000 square feet and the 
addition of 50,000. 
The center takes its name from 36,000-acre 
Grenada Lake, three miles northeast of town.  
The U.S. Army Corps of Engineers created 
it in the mid-1950s to control flooding of 
the Yalobusha River and still manages it.  Its 
amenities include a visitors center, tennis and 
basketball courts, boat launches, campsites, 
hiking trails, picnic pavilions, and beaches.  
A nearby state park boasts the award-win-
ning 18-hole Dogwoods golf course.
The task of promoting all this falls to the 
Grenada Tourism Commission, financed by 
sales taxes of 1 percent on food at the town’s 
more than 30 restaurants and 2 percent on its 
718 motel rooms.  Collections for the fiscal 
year ended Sept. 30 rose 7 percent from the 
year before, says the commission’s executive 
director, Walter McCool. 
Those motel rooms are clustered around 
Grenada’s exit on Interstate 55, a natural 
stopping point 100 miles south of Memphis, 
Tenn., and 115 miles north of Jackson,  
Miss. So, overnight visitors also add to the 
tourism budget. 
The lake is by far the top generator of tour-
ism dollars, logging 2 million visits a year, 
McCool says.  Besides the locals making day 
trips, there are many out-of-towners coming 
to commission-sponsored fishing tourna-
ments and fox hunts.  For hospital chief 
Denton, the proximity of the lake is “a won-
derful selling point” when the medical center 
recruits physicians, who are often reluctant to 
move to small towns. 
But, as he acknowledges, “Grenada is  
surviving largely because of our manufac-
turing jobs.”  He notes, as well, that the  
town has been lucky in not losing “any 
big-time players.”  A major exception was a 
hosiery maker that dated back to the 1930s 
and went out of business a few years ago.  
The closing left vacant a 400,000-square-
foot city-owned building, now a candidate 
for retail development. 
Hosiery simply went out of style, as did 
automobile hubcaps, which a Michigan 
Grenada’s city-owned general-aviation airport includes a wooden structure dating to World War II.  One of the 
three runways is 7,000 feet long and capable of handling big jets.  The Mississippi National Guard uses the airport for 
weekend training exercises, and the Grenada Tourism Commission sponsors aerobatic competitions there.
The Regional Economist  |  www.stlouisfed.org   19
Grenada/Grenada County, Miss.  
by the numbers
                          City  |  County
Population  13,092  |     22,971 *
Labor Force  NA  |       9,800    
Unemployment Rate  NA  |     11.2% **
Per Capita Personal Income  NA  |   $24,172 ***
    *   U.S. Census Bureau, 2010 census
  **   BLS/HAVER, October 2011, seasonally adjusted
***   BEA/HAVER, 2009 
larGest eMployers
Luvata 1,150
Advanced Distributor Products   750
Grenada Public Schools  698
Grenada Lake Medical Center  485 
Wal-Mart Supercenter   385
Grenada Stamping and Assembly  200
SOURCES: Self-reported, except Wal-Mart
 
    †   In peak season, April through September
† †   SOURCE:  referenceusa.com
†
† †company started making in Grenada in 1961.  
As many automakers stopped using hubcaps 
in favor of one-piece metal alloy wheels in the 
late 1980s, the plant that had become known 
as Grenada Stamping and Assembly almost 
went under as well.  Then, in 2005, Ice Indus-
tries of Sylvania, Ohio, bought and revived 
the operation, which today makes a diverse 
line of stamped metal products, including 
housings for air compressors and frames for 
solar panels. 
In the past two years, Ice has committed 
to investing $2.8 million in the plant and has 
won $775,000 in grants from the Mississippi 
Development Authority (MDA), contingent  
on the creation of 115 jobs.  Grenada County 
and the city of Grenada have granted $25,000 
and $15,000, respectively, to what is now 
Grenada’s fastest-growing employer.
Diaz praises the MDA as exceptionally 
efficient.  Its grants, available to communities 
to help companies that are investing in their 
businesses and adding or retaining jobs, are 
the incentives of choice for the Economic 
Development District (EDD).
In 2010, the local agency was instru-
mental in securing a $135,000 MDA grant 
for ADP in connection with a $1.5 million 
expansion.  The money went toward a new 
building, renovations to the company’s 
existing one and its promise of 26 more 
jobs.  “They are very open to our needs and 
very responsive to our needs,” ADP’s human 
resources director, Joe Trevino, says of the 
EDD’s intermediary role.  
In 2011, the EDD served as go-between 
for Luvata and the MDA, which granted the 
company $221,250.  The grant is linked to the 
company’s pledge to keep 25 jobs and invest 
more than $1.5 million in one of its three 
Grenada plants. 
Grenada’s manufacturing base boosts  
local incomes and living standards, Harbin 
says.  It doesn’t, however, buffer the area  
from economic headwinds.  Unemploy-
ment in Grenada County—where the city 
is the seat and only incorporated area—has 
lately been running a percentage point or 
two above the national average.  That’s down 
from a spread of more than four points two 
years ago.  Says Brown, “We feel like we’re 
weathering the storm.”  
The EDD, meanwhile, is aggressively pros-
pecting for new business.  “We are actively 
recruiting in other parts of the country,” Diaz 
says.  In doing so, he promotes a state that is 
“really pro-business,” with well-maintained 
highways and a cost of labor that remains  
“a great competitive advantage.” 
Brown describes Grenada’s workforce as 
high-quality, too, drawn from an area with a 
tradition of farming and the work ethic that 
goes with it.
“Industrial leaders say (new hires) may 
not be skilled, but they’re easily trained,” 
Brown says.  “They grew up working on cars 
Employees of Grenada Stamping and Assembly make housings for air compressor tanks, one of several new 
products that have revived the company, which used to specialize in automobile wheel covers, or hubcaps. 
Luvata employee Helen Tharpe works on tubing for a  
coil assembly.
Tameka Black brazes distributor tubes onto a coil at 
Advanced Distributor Products, which makes coils for 
residential applications.  
20   The Regional Economist  |  January 2012and tractors.  They have a great attitude and 
desire to work.”
Two of the brightest prospects these days 
are in industries unimaginable half a century 
and more ago, when Grenada began its rise to 
manufacturing standout. 
A biofuels startup, HCL CleanTech of 
North Carolina, has announced plans to 
build a small “demonstration-scale” plant 
in Grenada and larger commercial plants in 
Natchez, Booneville and Hattiesburg, Miss. 
Details have yet to be worked out.  Says Diaz, 
“If everything goes well, (the Grenada plant) 
could have a big impact.” 
So would a data center—one of a new 
generation of huge, off-site computer instal-
lations now favored by big-city banks and 
retailers.  A 2010 study by Deloitte Con-
sulting of Chicago, commissioned by the 
Tennessee Valley Authority, identified a site 
in Grenada among 13 in the TVA’s service 
area as particularly suited for one of these 
setups.  Grenada’s candidate property is 
development-ready, complete with all utilities 
and fiber optics, Diaz says. 
Data centers require precise temperature 
control.  In the competition to attract one of 
them, Grenada can offer its expertise in mak-
ing coils for that very purpose. 
Susan C. Thomson is a freelance writer  
and photographer.
Fishing is one of the many recreational activities and ame-
nities that attract 2 million visitors a year to 36,000-acre 
Grenada Lake, three miles out of town and Grenada’s big 
tourist attraction.  
Eleven more charts are available on the web version of this issue.  Among the areas they cover are agriculture, commercial 
banking, housing permits, income and jobs.  Much of the data is specific to the Eighth District.  To see these charts, go to 
stlouisfed.org/economyataglance
U.S. AGRICULTURAL TRADE FARMING CASH RECEIPTS   
06 07 08 09   10 11
90
75
60
45
30
15
0
NOTE:  Data are aggregated over the past 12 months.
Exports
Imports
October
Trade Balance
B
I
L
L
I
O
N
S
 
O
F
 
D
O
L
L
A
R
S
06 07 11 08 09 10
230
210
190
170
150
130
110
90
NOTE:  Data are aggregated over the past 12 months.
October
Crops Livestock
B
I
L
L
I
O
N
S
 
O
F
 
D
O
L
L
A
R
S
CIVILIAN UNEMPLOYMENT RATE INTEREST RATES   
06 07   08 09 10 11
11
10
9
8
7
6
5
4
P
E
R
C
E
N
T
November
06 07 08 09 10 11
6
5
4
3
2
1
0
10-Year Treasury
Fed Funds Target
November 1-Year Treasury
P
E
R
C
E
N
T
NOTE:  On Dec. 16, 2008, the FOMC set a target range for 
the federal funds rate of 0 to 0.25 percent.  The observations 
plotted since then are the midpoint of the range (0.125 percent).
INFLATION-INDEXED TREASURY YIELD SPREADS RATES ON FEDERAL FUNDS FUTURES ON SELECTED DATES
3.0
2.5
2.0
1.5
1.0
0.5
0.0
–0.5
–1.0
–1.5
–2.0
–2.5
NOTE:  Weekly data.
5-Year
10-Year
20-Year
P
E
R
C
E
N
T
Dec. 16, 2011
07 08 09 10 11 Dec. 11 Jan. 12 Feb. 12 March 12 April 12 May 12
.13
.12
.11
.10
.09
.08
.07
CONTRACT MONTHS
P
E
R
C
E
N
T
8/09/11
9/21/11 12/13/11
11/2/11
REAL GDP GROWTH CONSUMER PRICE INDEX
06 07 08 09 10 11
8
6
4
2
0
–2
–4
–6
–8
–10
NOTE:  Each bar is a one-quarter growth rate (annualized); 
the red line is the 10-year growth rate.
P
E
R
C
E
N
T
Q3
06 07 08 09 10 11
6
3
0
–3
P
E
R
C
E
N
T
 
C
H
A
N
G
E
 
F
R
O
M
 
A
 
Y
E
A
R
 
E
A
R
L
I
E
R
November
CPI–All Items
All Items Less Food and Energy
econoMy aT a glance
The Regional Economist  |  www.stlouisfed.org   21

Bucking the trend in manufacturing in Grenada, Miss.

http://stlouisfed.org/publications/pub_assets/pdf/re/2012/a/Grenada_Miss.pdf

Bucking the trend in manufacturing in Grenada, Miss.

Abstract

Similar works

Full text

Available Versions

Research Papers in Economics