By Michael C. Randle
We have heard ad nauseam for decades by old school economic developers and politicos the fable that 80 percent of all new jobs are created by existing industry. Existing industry, as in those with plants or offices that expand in the same place or nearby.
New, as in a new project that has not operated before in the place they have chosen in the South. That could be a greenfield project built on open land or a certified industrial site, or a new user of an existing building that is available in that particular county. Of course, many of those buildings were constructed as speculative buildings to lure industry as they are an important recruiting tool.
Maybe 80 percent of all jobs created in the South were generated by existing industry 30 to 50 years ago, but no more. It is simply not true. New vs. Expanded projects are a different percentage in the South every year now. In other words, the percentage changes and is in flux in any given year depending on industry location trends. To believe the 80 percent is the standard is absurd.
The South is home to ninety-million new people over the last 70 years. New companies followed them.
I can take a guess on why the 80 percent has become fiction and no longer fact. For one, when I was born in 1955, the Northeast, Midwest, and the South (not the West at the time, as it was the lowest populated region in the country) all had about the same population. Back then, all three regions had about 50 million residents each.
Today, the South is home to more people than the Northeast and Midwest combined. That means millions of people have relocated here and thousands of companies have announced new projects in the region over the last five or six decades. Economic development projects follow the people. Many of those over the last 10 years have been new economic development projects.
Fact is, the last five years or since COVID, new projects have outbid expansion and relocations in dominant fashion. Think data centers and A.I. and all of their suppliers. Think elephant in the room as the A.I. industry is dominating deals throughout the region.
Those entire data center related projects have been new deals over the last five years. That was also the case during the EV frenzy from 2021 to 2024 when new battery plants and an EV parts facility opened as new projects.
Look at our “Big Buffalo Awards” on SouthernBusiness.com. We break them down by new (N), existing (E) and relocations (R). On average over the last several years, more than 60 percent of announced deals in the South are new projects. Then again, we are quite sure that 100 percent of all “lost jobs” are created by existing industry. Think about it!
Over the last five-and-a-half years, new project totals have dominated the largest 10 job deals per quarter. That would be from winter 2021 to summer of 2026.
Here are the totals for new, expanded and relocated top 10 projects by jobs announced each quarter from 2021 to 2026. These are based on new projects, expanded deals and relocations either from another state or country announced in the South. Again, these totals are based on the top 10 job projects announced quarterly from Winter 2021 to Summer 2026.
New projects Expanded projects Relocated projects
118 67 8
Source: SouthernBusiness.com
As you can see, based on the largest projects announced each year in the South, new project totals dominated the categories of new, expanded (existing industry) and relocated project totals. Most of the relocation deals are corporate headquarters moving from another state located outside the South to the South. So, with that written, it comes out to 64 percent of all announced projects from 2021 to summer 2026 were new deals, not existing industry expansions.
So, essentially, there is absolutely no chance that 80 percent of all new jobs created in the South for at least the last five years, were generated by existing industry. If anything, it may be the other way around with new energy, data center, next-generation mobility and the reshoring of manufacturing of all kinds highlighting deal captures since the pandemic.
The statement “80 percent of new jobs are created by existing industry” is a myth that started as far back as 60 years ago by the Southern economic development community and their politico bosses. This data has proven to show that the “80 percent rule” is an old adage that no longer exists.
To go deeper into just the top 10 projects over more than five years, let’s take a look at calendar year 2025 and its top 100 job projects announced in the South that year. In 2025, there were 71 new deals, 28 expansions and one relocation.
Of course, those projects in 2025 all met our thresholds of $30 million in investment or 200 jobs. With the new SB&D 100 coming out on SouthernBusiness.com shortly after the end of the year, we are changing our thresholds after 34 years to a more modern and accurate assessment of economic development captures in the South. These days, projects are capital heavy and job light and with A.I. that is expected to continue. So our new thresholds will be $50 million and 100 jobs beginning with the SB&D 100 in 2027. That methodology will be hammered out at SEDR@RosemaryBeach in December.
With that settled, we can all now ditch the old saying in economic development circles that 80 percent of all jobs created are produced by existing and expanding industry. It is just not the case. Again, though, 100 percent of lost jobs come from existing industry.
So, next time you hear a mayor, governor, an economic developer, site consultant or anyone claiming that “80 percent of all new jobs are created by existing industry,” tell them they have old data. It is just a myth, or an old tale. It is just not true anymore.
Or, it could be that the home county of the official making the claim is falling behind on new deals, has not landed one in years, and points to its remarkable ability at the retention of its existing companies. To be honest, that is more of how the Midwest views economic development, not the South. So, given that, it could be that 80 percent of all jobs created by existing industry are more of a Midwestern and Northeastern thing.
And that begs the question, “What is best?” Are expanding companies more or less important than new deals?
