I graduated from the University of Alabama in 1965.
If you are a college football fan you may remember that between 1961 and 1965 UA won three NCAA College National Championships.
Joe Namath was our quarterback, but more importantly, our coach was the legendary Paul Bear Bryant.
No need to give a history lesson on Coach Bryant, but unless you’re of a certain age, you may not know one important fact about the Bear.
Coach Bryant was the spokesperson for Golden Flake.
To this day, I can’t picture Coach Bryant without thinking about potato chips.
Golden Flake recently announced it had been purchased by Utz, a Pennsylvania firm. Yes, a business located in the same state as Penn State had acquired a public company headquartered here in Birmingham.
This may not seem like a big deal, but Birmingham keeps losing our public companies.
It’s a slow drip—a little drop of water at a time–until you notice that the tank’s almost empty.
According to the Birmingham Business Journal, in 1998, Birmingham headquartered 30 public companies.
Today only 10 public companies are headquartered here. Single digits are around the corner.
Some of the companies we’ve lost are…
- Colonial Properties Trust
- Birmingham Steel
- Citation Corporation
- Vesta Insurance
- Just for Feet
And don’t forget Zoe’s Kitchen. Its corporate people snuck out of town one night after it was bought and is now headquartered in Plano, Texas.
We’ve lost public companies for all kinds of reasons, but more importantly, we haven’t been able to replace them.
To give you some perspective, 29 public companies are headquartered in Nashville.
Why should we care?
When a Birmingham company is purchased by outsiders, the local executives take orders from out of state and company profits leave our state.
Many of these acquired companies try to be good corporate citizens, but it’s never quite the same. Often corporate management is transferred here from other cities and ultimately promoted elsewhere. There’s just not the same personal investment or attachment to our community.
We are left with a dearth of leadership and less financial resources and brain power to drive our region.
I wrote a piece a while back about Fred McCallum, the President of AT&T Alabama. At that time he was the volunteer leader for four major non-profits: Birmingham Business Alliance, Campaign Chair of the United Way of Central Alabama, Chairman of PARCA Board, and Chairman of the Business Council of Alabama Progressive PAC Board.
He’s currently President of the Rotary Club of Birmingham.
Why should one corporate volunteer have to be responsible for multiple non-profits at the same time? Because much of our corporate talent has evaporated.
And the quantity and quality of Birmingham jobs remaining is diluted.
I tried to help a friend find a high level management position. I asked a recruiter from a large insurance company about job options emphasizing that my friend and his family didn’t want to move. She said her company, who used to have a large Birmingham presence, was now only hiring clerical type employees in Birmingham. The high paying management positions had moved to Atlanta.
And the loss of public companies has a negative effect on local firms that support them. Often law firms, accounting firms, and other service providers are fired or receive less business.
We in metropolitan Birmingham (7 counties) have 14,000 fewer people working today than we did in 2007—while our competing Southern cities celebrate double digit employment growth.
Why are we losing our biggest companies?
Birmingham’s located in the heart of the Southeast, the fastest growing region in America. Birmingham is beautiful. Our people are kind, generous, and smart. And there’s less traffic than other cities.
So why are we stagnant?
The problem is our local government structure. We have too many municipalities in the Birmingham area paying huge sums of money to entice a company located on one side of town to move to the other side of town. Read “Nick Saban proves we in Birmingham are a bunch of suckers.”
We don’t need to suffer like this. There are viable government options open to us.
Meanwhile, Coach Bryant should be proud– Alabama’s still winning football championships.
But we’re losing our public companies, jobs, and our children to cities who maximize their efforts through government cooperation and a common vision.
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David Sher is Co-Founder of AmSher Compassionate Collections. He’s past Chairman of the Birmingham Regional Chamber of Commerce (BBA), Operation New Birmingham (REV Birmingham), and the City Action Partnership (CAP).