From Merthyr to Memphis
Stories of Post-Industrial Blues
The greatest moment in economic development has to be the ribbon-cutting for a new factory. And the lowest point is when a major employer closes down and leaves town.
So it was with a heavy heart that I read this week about the planned demolition of the Hoover factory in Merthyr Tydfil, Wales, that once employed 5,000 people. (https://www.walesonline.co.uk/news/wales-news/huge-hoover-factory-employed-5000-31828908) The factory closed in 2009, ending 60 years of manufacturing by what was one of the biggest inward investment successes following the second world war. In its place will be 400 new houses.
Four thousand miles away in West Tennessee, another former appliance factory is transforming, phoenix-like, into the epicenter of a new era.
When Electrolux stopped production at their Memphis factory in 2022, nobody would have dreamed what might be around the corner. Within a year, the tired-looking industrial site had been spruced up and leased to Elon Musk’s artificial intelligence company, xAI. The facility will house Colossus, the world’s biggest supercomputer for AI training models.
The deal is the most significant capital investment by a new-to-market company in Memphis’ history, according to Joann Massey, president and CEO of the Economic Development Growth Engine Board. “It's not only going to bring revenue, jobs, and investment infrastructure to Memphis, but it's going to bring even more opportunity and interest.”
Greater Memphis Chamber President and CEO Ted Townsend said: “When we announced six months ago that xAI would make Memphis its home for Colossus, we recognized it as our defining moment. Memphis has provided the power and velocity necessary for not just xAI to grow and thrive, but making way for other companies as well. We’re excited to welcome Nvidia, Dell, and Supermicro to the ‘Digital Delta’.”
Without economic developers xAI would have located elsewhere. It’s fair to say that Tennessee wasn’t a frontrunner for this project until the local team pulled together key partners and worked tirelessly to win the project in a frenetic 90 day period. Investment promoters went the extra mile and made a genuine difference.
This isn’t just about AI jobs, Memphis is leveraging the project as part of a wider vision for a ‘Digital Delta’ that includes “agri-business and food; medical device and healthcare technology; supply chain and logistics; electric vehicles and sustainable mobility”.
A number of recent Memphis investments have already been announced by Tennessee Department of Economic and Community Development, including AAON moving into the former American Snuff factory; and international moves including Dutch-owned electronics firm Reconext and Korea’s Hyosung HICO creating new jobs.
Memphis shows Merthyr that there can be rebirth. Jobs of the future and new investment in tech infrastructure isn’t just for the likes of Cambridge and California… but it needs people with ambition, vision and drive to make things happen.
Merthyr was once the 'Iron Capital of the World' and had the world's first steam-powered railway journey in 1804. Memphis is the ‘Home of the Blues’ and the true birthplace of Rock ‘n’ Roll. Historic narratives have a value today, but they are not set in stone and fixed forever.
Innovators, entrepreneurs, economic developers and investment promoters have the power to write the next chapter.