The Battery Belt is taking shape, and it’s creating a new economic development model where a college degree won’t be the ultimate qualification for jobs.
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In 2022 we saw industrial policy passed by Congress intersect with investment plans from major manufacturers and startups, all emphasizing the future need for batteries for energy storage. But unlike the urban employment centers we’ve seen emerge in the last several decades, the regions now being dubbed the “Battery Belt” don't feature college graduates clustering together in office buildings in a handful of expensive cities to create internet and software-related products. It's more geographically diverse, with different economic and infrastructure needs than the prior era that was so heavily influenced by Silicon Valley.
An obvious difference between building batteries and building software is that batteries for electric vehicles and other large-scale industrial uses can weigh more than 1,000 pounds. The production and warehousing requirements for that kind of equipment rules out urban knowledge centers — the economic winners of the past 40 years — as the focus for this new wave of industrialization.
A year ago I foresaw that the electrification of the auto industry would be a boon for the South. While that's certainly been the case, the Midwest has also seen its share of wins this year. With an additional year of data to analyze, there are patterns emerging in the kinds of places being chosen for new battery plants.
The most important feature for sites is large tracts of land available near the right kind of physical infrastructure and major population centers. Here in Georgia and adjacent South Carolina, five multibillion-dollar battery plants have been announced over the past few years. Two of them are in the counties next to the ports of Charleston and Savannah, and the other three are about an hour outside of Atlanta next to both railroads and highways.
After that, softer factors come into play: the quality, size and cost of the local workforce, proximity to future customers, the ability of local officials to woo manufacturers, and whether there are other related production facilities close by. For instance, Stellantis NV is building a battery plant in Kokomo, Indiana, in large part because it already has a plant there that produces vehicle motors (gasoline and hybrid for now, electric in the future).
While the Battery Belt will need a trained workforce, it won't be as reliant on workers with elite educations as the Silicon Valley economy was. In the four counties in Georgia where battery plants exist or are being built — Jackson, Bartow, Coweta and Bryan — the percentage of adults with at least a bachelor's degree are 23.5%, 19.8%, 33.3% and 33%, respectively. That compares with 50% for the main two counties encompassing Atlanta: Fulton and DeKalb.
Read the full article here by Conor Sen, Advisor Perspectives.
