Chester is a prime example of corporations benefiting from public investments in South Carolina at the expense of local communities

Between 2020 and 2024, South Carolina’s job growth meaningfully outpaced job growth nationally. Our recent report analyzes the state’s economic boom in recent years, fueled in part by federal investments in the Bipartisan Infrastructure Law and the Inflation Reduction Act. A key industry in the state is manufacturing, especially tires, auto, and auto parts manufacturing. South Carolina’s political leaders boast that the state leads the nation in the export of tires and completed passenger vehicles.

Even before federal investments spurred the state’s manufacturing growth, lawmakers were using generous economic development subsidies to lure manufacturing to South Carolina. While the state’s approach has created jobs, the quality of those jobs and the overall benefit to South Carolina communities—at substantial public cost—remains dubious.

Chester County, South Carolina, is a prime example. Between 2014 and 2023, growth in manufacturing jobs in Chester County vastly exceeded that of South Carolina as a whole—43.7% compared with 14.3%. As a result of successful efforts to attract corporations to Chester County, it is home to more than 50 manufacturers across industrial sectors, including Giti Tire, a Singapore-based tire manufacturing company featured on the Chester County Economic Development website.

Despite the rapid growth in manufacturing in Chester County, its residents, particularly the ones living in the city of Chester, are seeing limited benefits from that growth, despite generous subsidies to manufacturers for locating in Chester County. Giti Tire, for example, received over $35 million from the Coordinating Council for Economic Development’s Rural Infrastructure Fund as well as $12 million in local tax breaks between 2018 and 2022, with at least $4 million more per year expected at least through 2026. The company promised to create 1,700 jobs. Their website indicates they began production in 2017 and surpassed one million tires in 2018. Yet their Chester plant employs between roughly 600 to more than 900 workers, with the most optimistic number being just over one-half of the promised number of jobs.

This highlights one of the many problems with economic development subsidies: They frequently lack any penalties for subsidized companies that fail to meet their promises. Further, many subsidies that go to corporations are not coupled with requirements that local communities benefit. Rather, many subsidies simply divert tax dollars away from investments in local schools, public roads, and health care. This has been particularly problematic in Chester, which faces some of the largest losses of public school funding to tax abatements, losses which have increased in almost every year since 2017 with the exception of 2020 when it remained roughly stable.

Workers and families in Chester recognize that the benefits major corporations receive for locating in their communities go far beyond just subsidies. Chester provides manufacturers with broad access to varied transport options for importing raw materials and exporting finished goods including by railroad, port, and major highway networks. Auto and tire manufacturing particularly benefit from their proximity to other auto and auto parts manufacturers and related supply chains supporting these manufacturers.

Of course, the region’s greatest asset is an available workforce, ready to work if given access to quality jobs. Chester is an area that has long been neglected by state lawmakers and whose residents have been exploited by corporations historically and continue to be exploited today, including by large multinationals like Giti Tire.

For decades, lawmakers in South Carolina have embraced an economic development strategy common in the South, centered on disempowering workers and communities, keeping wages and benefits low, and limiting worker protections. South Carolina is one of just five states in the country that does not have a state minimum wage. It is one of two-dozen states with a so-called right-to-work law, which guarantees neither workers’ rights nor a job. Instead, these laws make it more difficult for workers to build and sustain a union, one of the most effective avenues for workers to collectively demand a living wage, safe workplaces, and basic benefits such as health insurance and paid sick days.

As we illustrate in our recent report, these policies and the state’s history of strong opposition to multiracial worker solidarity have left South Carolina with the lowest union coverage rate of any state in 2023, and the third lowest rate in 2024.

These factors are compounded by a range of labor market disadvantages faced by Chester residents. Table 1 shows both Chester County (35.8% Black) and the city of Chester (64.3%) are disproportionately Black compared with their counterparts nationally (12%) or statewide (25.1%). Just 8.4% of those in Chester County and 10.5% of those in the city of Chester hold a bachelor’s degree, roughly half the national (21.3%) or state-wide (19.4%) rate. Chester residents are also about twice as like to fall below the poverty line—19.3% of Chester County, 25% of the city of Chester, compared with 12.4% of Americans nationally and 14.2% of all South Carolinians.

The higher poverty rates shown in Table 1 reflect to some degree low median wages. Median earnings in Chester County ($44,908) and the city of Chester ($38,687) are just 74.7% and 64.4%, respectively, of the earnings of workers nationally ($60,096).

Workers in the Giti plant report that instead of hiring the promised number of workers, the company forces them to work mandatory overtime, in unsafe working conditions, and segregated by gender. Occupational sex segregation is a key factor in women’s lower pay relative to their male counterparts, and earnings data for manufacturing workers in Chester are consistent with this finding. The data show that in the city of Chester, women are paid just 57.1 cents for every dollar paid to male workers. Nationally, women in manufacturing are paid 77.5 cents for each dollar paid to men.