Mars gets state aid for plant add-on

Mars, the food company known for its candy bars, is investing $72 million in its Fort Smith pet food plant after receiving a $500,000 incentive from the Arkansas Economic Development Commission.

The plant is to add about 130 workers to its current workforce of more than 200 people by the time the expansion is done, which the company estimates at one to five years. As part of the expansion, Mars Petcare, whose brands include Pedigree, Cesar and Iams, will add two new lines at the plant, the company announced at its Fort Smith facility Wednesday.

In addition to $400,000 from the Quick Action Closing Fund, an incentive program run through the Arkansas Economic Development Commission, and $100,000 for worker training, Mars will receive tax rebates from the state, said Mike Preston, director of the commission. The Fort Smith plant is Mars' only Arkansas location. The company is headquartered in Virginia.

"The additional millions of dollars of payroll will go into pockets in this community," Preston said.

Mars has committed to a $72 million investment, but it could increase that number to $110 million, the company said.

Fort Smith has tried to rebuild its manufacturing employment since 2011, when the unemployment rate in Fort Smith reached 10 percent.

Manufacturing makes up 18 percent of the city's workforce, said Tim Allen, president of the Fort Smith Chamber of Commerce.

In 2011, one of the city's largest employers, Whirlpool, moved its operations out of Arkansas to facilities in Iowa, Ohio and Mexico. At its height, Whirlpool employed about 4,500 people in Fort Smith. By the time it closed, only 850 people worked for the company in Fort Smith.

"We've more than made up for that loss," said Gov. Asa Hutchinson at the Mars Petcare facility in Fort Smith on Wednesday.

Nationally, jobs in the manufacturing sector continue to decline even as manufacturing output increases. The manufacturing sector lost 4,000 jobs in November while the overall U.S. economy created 178,000 jobs. It's the fifth month in a row that manufacturing has lost jobs.

Fort Smith's unemployment rate hit 4.2 percent in October, compared with Arkansas' 4 percent rate, according to the Bureau of Labor Statistics.

The company is capitalizing on an increasingly profitable pet food industry, which is growing rapidly as pet owners continue to spend more on their animals.

It's also a steady industry. According to a survey by the American Pet Products Association, 74 percent of pet owners said the amount they spend on their pets is not affected by the economy.

Spending on pets increased 5.3 percent in a year, according to a 2015 Bureau of Labor Statistics survey. Overall, pet spending in the U.S. reached $67.75 billion in 2015. The pet food segment grew 22.5 percent in the same year.

"It gives confidence to the workers here," Hutchinson said. "The company is saying we are growing, we are investing. Your jobs are secure."

The Mars Petcare plant in Fort Smith opened in 2007. Since then, Mars has invested $130 million in the site.

Mars' other brands include candies such as Milky Way, Twix, Altoids and Snickers, as well as Uncle Ben's rice products.

Business on 12/15/2016

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