Howard casts big shadow in county, state
By EMMA JAMES • August 31, 2008

Howard Industries wields a big stick in Jones County and Mississippi.

The manufacturing powerhouse, which found itself in the spotlight last week when U.S. agents raided its operations in Laurel and Ellisville and detained 595 suspected illegal workers, is the largest employer in Jones County and is politically connected.

The company, with an estimated $1 billion in sales last year, has remained quiet in the aftermath of the raid, refusing to comment other than releasing a brief statement Monday in which it defended its hiring practices.

"I have no interest in commenting on any article you wish to write," Chief Executive Officer Billy Howard Jr. said when contacted for this article.

Very few Laurel residents are willing to speak on the record about their relationship with the Howards or the company's economic and political connections to Jones County.

"Obviously, the Howard family has some political clout. They have been an instrumental part of our state's economy for many years," said state Sen. Chris McDaniel, R-Ellisville, in an e-mail interview.

McDaniel has been a friend of the Howards for 25 years and received a $2,000 contribution to his 2007 campaign from Howard Industries and Howard Transportation.

However, McDaniel said, that donation did not obligate him to alter his conservative views, particularly on his opposition to illegal immigration.

"Though I've only served one year in the Senate, I've never witnessed them trying to throw their weight around," said McDaniel. "They've always been very professional and respectful of the legislative process."

The Legislature in 2002 approved $31.5 million in bonds for the company to expand its computer and transformer manufacturing operations. The company put up $80 million.

The legislation required that the company hire 2,000 employees for the computer and transformer divisions by 2012. If it fails to meet that deadline, the company must repay the state $3,000 for every employee short of that mark.

Interestingly enough, the 2002 legislation included a requirement that the company hire workers eligible for employment under state and federal law due to concerns about the hiring of illegal immigrants in other industries, according to a 2002 report in The Clarion-Ledger.

But a reading of the bill that was overwhelmingly approved by the House and Senate does not detail any penalties for hiring illegal workers.

The company

Howard Industries had humble beginnings.

Billy Howard Sr. left a job as a salesman for General Electric Co. after 12 years and began the company in the late 1960s with 100 employees. The company manufactured industrial electric transformers.

It was a family affair for the still privately-held company, with Billy Howard Sr. as its CEO, his wife, Linda, as president and each of their three children - Billy Jr., Michael and Cyndi - holding key jobs.

Today, the company, with its modern glass-façade headquarters anchoring the Howard Technology Park near Ellisville, is one of the largest manufacturers of transformers in the world and has customers around the globe.

It offers a diverse product line that includes electrical transformers, industrial voltage regulators, computers, lighting fixtures and lights.

It also builds specialized computers, medical technology products and has a transportation division.

The company's footprint grew in the last couple of years when it opened the 450-acre technology park in rural Jones County between Ellisville and Hattiesburg.

The $71 million technology park includes a 200,000-square-foot power transformer substation plant and a five-story, 180,000-square-foot headquarters building and adjacent computer plant that was completed last year.

Howard Industries has a partnership with Jones County Junior College, which has run a training program for the company's employees since the company's founding.

In return, Howard Industries has provided space and assistance for the $4 million Lowery A. Woodall Advanced Technology Center in the technology park that was built with a portion of $10 million in private funds that Howard helped raise. Howard also contributes an undisclosed number of scholarships to the junior college.

"Our charge from the state is to train the workforce," said JCJC President Jesse Smith. "Regardless of how many workers that are no longer there, we have to train the ones that are, just as we would for any other company."

ICE's investigation

After Immigration and Customs Enforcement agents raided two of the company's plants on Monday in the largest operation of its kind in U.S. history, the company said its hiring practices complied with federal, state and local laws.

"Howard Industries has done nothing wrong and has not been charged," reads an underlined sentence in a letter it sent to its customers.

The investigation of Howard Industries began three years ago after a tip from a union member, ICE officials said. No federal charges have been filed against the company but the investigation continues, officials said.

It has never been a secret that Howard Industries, along with other companies in the area, hire undocumented workers or that the practice creates tension in a plant, said Robert Shaffer, president of the Mississippi AFL-CIO.

"Illegal workers don't have a voice," he said. "They have no recourse under the law if they are working 60 hours a week in poor working conditions. And because they don't have a voice, neither do workers that belong to a union if they want to keep their job.

"If they speak up, they are replaced by another illegal worker because illegal workers are controllable."

The International Brotherhood of Electrical Workers Chapter 13-17 has a 2,600-member presence at Howard Industries, said Shaffer. Calls to chapter president Clarence Larkin were not returned.

Economic impact

Howard Industries is the largest employer in Jones County with 4,300 employees. The company has played a vital role in the economy of Jones County and the raid will have a large impact on business in the county, said Mitch Stennett, president of the Jones County Economic Development Authority.

"Any industry that provides a large number of jobs has a good effect on the economy," he said. "Those employees take their payrolls and spend money, part of which goes to taxes, which goes to the city, which provides services."

The impact of losing nearly 600 workers and their families from the Laurel economy will be felt, said Bill Gunther, professor and director of the Bureau of Business and Economic Research at the University of Southern Mississippi.

"When you reduce the level of economic activity, it's going to have an impact," he said. "It doesn't matter if they are illegal or not. They are leaving filled jobs unfilled, which reduces both spending and tax collection, which affects the whole economy."

The actual effects on the economy are gauged by sales tax numbers, which won't be available for a couple of months, Stennett said.

"One of the biggest problems that we have right now is the uncertainty," he said. "We just don't know yet how much this is going to affect the county."

The determining factor of the raid on the economy, Gunther said, is whether Howard Industries will be able to fill the vacant jobs quickly. Hundreds of workers lined up outside the Laurel plant after the raid seeking jobs.

"The argument is that those jobs can now go to American workers," Gunther said. "I think that's wishful thinking. I don't think that there are 600 people ready to move in and take those jobs, and that is going to have a significant economic impact."

Howard Industries said in a memo to customers Wednesday the company expected to be fully staffed by Friday. Howard officials would not confirm the number of new employees hired at the plant since Monday.

Political impact

Howard Industries and CEO Billy Howard Jr. contributed a total of $25,000 to state campaigns in 2007, according to the National Institute on Money in State Politics, a nonprofit organization that runs a comprehensive campaign finance database based on files from state disclosure agencies.

Of that, $10,500 went to the campaign of Gov. Haley Barbour, R, with $4,000 donated by Howard Industries and Howard Trucking. The remaining $6,500 was made by Howard Jr.

Barbour was not available to comment Friday, said Pete Smith, spokesman for the governor. The second largest contribution - $4,500 - went to the failed lieutenant governor bid of former State Sen. Charlie Ross, R, while Rep. Bobby Shows, D-Ellisville, received $4,000. Other legislators received smaller contributions, included McDaniel, Sen. Haskins Montgomery, D-Bay Springs, and state Auditor Stacey Pickering, R, a former Howard Industries employee. None of the contributions was under $1,000.

Pickering said the campaign donation from the Howards was not unusual.

"Relative to me and our campaign, the Howards didn't give any more than any other large donor," Pickering said. "I wouldn't say that the Howards have any sort of influence over candidates or politics based on donations."

Howard Industries received $31.5 million in bonds for expanding transformers and computer manufacturing facilities in 2003. The company also netted $20 million for GO Zone projects as of June this year.
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