Factories find future is what you make it.

• Author: Speizer, Irwin
• Position: MANUFACTURING

Barry Matherly lives in the future. As executive director of the Lincoln Economic Development Association, he scouts the globe for prospects. The result of his efforts is a mosaic of what manufacturing might become in North Carolina.

An Australian licorice maker moved into Lincoln County. So did a Brazilian producer of automotive gaskets and a Japanese company that makes the guts of catalytic converters. Also arriving: a drug plant, a tortilla factory, a plate-glass manufacturer and kitchen-cabinet builder. "The last three years have been record years for us in new investment in manufacturing and distribution," Matherly says. "Last year was double our best year ever, which was the year before."

What economists have been saying for years--that North Carolina manufacturing needs to move beyond its traditional mainstays of textiles, tobacco and furniture--is happening here and in other parts of the state. There's a catch: Many of the new manufacturers use technology that requires higher-paid workers--but fewer of them--than industries of old. "You are not going to see the thousand-person textile mills coming back anytime soon," Matherly says. "What we are seeing is higher-tech manufacturing, more sophisticated machinery and equipment. You might have 50 to 100 people in a large facility."

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Other parts of the state have been able to lure new plants or expansions in fields such as drugs, auto parts, electronics and food processing. But despite hefty investments, the manufacturing work force has not rebounded from the job drain that shuttered many of the state's largest factories. "Most of the layoffs are behind us," Wachovia economist Mark Vitner says. "But there is not likely to be much of a recovery in jobs."

In fact, the state is still bleeding factory jobs. The losses began in 1995 and peaked in 2001, when it lost more than 80,000--11%--of its factory jobs. In 2005, manufacturing employment shrank 1.7%, shedding about 10,000 jobs. More were to follow. In November, manufacturing employment was down to 550,700, a decrease of 14,700--2.6%--from the end of 2005.

The biggest loser last year was textiles. By November, Tar Heel mills had eliminated 11.6% of their jobs, employing only about 46,000. Maiden-based Carolina Mills, which had 2,600 workers six years ago, announced in May that it was getting out of domestic yarn manufacturing by closing plants in its hometown, Lincolnton and Statesville--its last three--and eliminating...