CHICAGO (Dow Jones)--Boeing Co.'s (BA) new 787 Dreamliner plant in North Charleston, South Carolina, should have "a ripple effect that will play out over time," generating economic activity across the state, Mark Sanford, South Carolina's governor, said in an interview Thursday with Dow Jones Newswires.
Sanford spoke by telephone en route to Charleston from the state capitol.
Late Wednesday, Boeing said it had chosen South Carolina over Washington state for added 787 production. The new facility, to supplement final assembly in Washington state, is expected to be up and running by July of 2011.
To woo Boeing, South Carolina legislators offered substantial financial incentives. Boeing gets those benefits if it brings in at least 3,800 new jobs and invests $750 million in the next few years.
"This is the largest single job creation in South Carolina history," Sanford said. "It will give us an immediate shot in the arm at a time when it's needed."
As with other states, South Carolina is battling unemployment, now at about 10%. But, Sanford said, that comes on top of strong job growth in the past few years, as 85,000 new workers have come into the state. He hopes that Boeing will hire as many local workers as possible, although the number of local hires hasn't been discussed.
Over the long term, Sanford expects Boeing suppliers and other businesses to come to South Carolina, "repeating what we saw with BMW." The German auto maker has had a U.S. production plant in Spartanburg, South Carolina, for 15 years, and currently is expanding that facility.
Boeing recently bought out a supplier's factory in North Charleston, and plans to expand there to add production capacity for the 787. But Sanford said he and South Carolina officials have been talking to Boeing since 2003, when the aircraft maker turned down his state's offer to start initial 787 assembly work in Everett, Washington.
In its home state of Washington, Boeing's Commercial Airplanes unit employs about 73,000 workers, and accounts for many more jobs there.
In the Seattle area, where most workers are located, business costs are relatively high, partly due to the presence of unions. Sanford said the recent decision by Boeing's North Charleston workers to reject union representation made a difference to Boeing, which has suffered a series of employee strikes in recent years. "They proved to Boeing that this is a right-to-work state," Sanford said.
-By Ann Keeton, Dow Jones Newswires; 312-750-4120; ann.keeton@dowjones.com