As billions pour into Southern manufacturing facilities, a new Economic Policy Institute analysis argues community benefits agreements (CBAs) could ensure these investments create quality jobs and regional prosperity. The report comes amid record factory construction in states like Georgia, Tennessee and South Carolina.
CBAs are legally binding contracts between developers and coalitions of community groups, typically guaranteeing local hiring, wage standards, and workforce development programs. The EPI study examined 12 recent Southern manufacturing projects with CBAs, finding workers earned 18-35% higher wages than comparable non-union facilities in the region.
‘These aren’t theoretical benefits,’ said a labor economist familiar with the research. ‘We’re seeing CBAs successfully applied at electric vehicle battery plants and semiconductor fabs across the South.’
However, implementation challenges remain. Only 23% of major Southern manufacturing projects since 2020 included CBAs, according to federal contracting data. Some state officials argue such agreements deter investment, citing Alabama’s recent rejection of CBA requirements for a $2 billion automotive project.
Analysts suggest the coming wave of Inflation Reduction Act-funded clean energy projects may test CBAs’ scalability. ‘The real question,’ noted one industry observer, ‘is whether these agreements can move from exceptional cases to standard practice.’