Insurance giant MetLife Inc. said last week that it will move 2,600 jobs from offices in four Northeast states and California to lower-cost locations in two North Carolina cities, while also getting tax breaks and other incentives that could reach $100 million.
The insurer is shifting the jobs from Lowell and Boston, Mass.; Somerset, N.J.; Bloomfield, Conn.; Johnstown, Pa.; Warwick, R.I.; and Aliso Viejo and Irvine, Calif., MetLife spokesman John Calagna said. The positions will be consolidated in Charlotte, which will become the U.S. headquarters for MetLife’s retail business, and at a global technology and operations hub in the Raleigh suburb of Cary. The company’s retail segment sells and services life, disability, auto and other insurance.
MetLife employs about 23,000 U.S. administrative staffers in about 30 locations, mostly in the Northeast, Calagna said. The consolidation will allow teams to work together in the same location while cutting MetLife’s real estate presence, he said.
“What’s happening is there are 2,600 jobs in these locations that either we’re closing or we’re reducing. All of those positions are being transferred to North Carolina,” Calagna said.
The new jobs, paying average salaries of nearly $82,000 a year, would include product management, marketing, sales and customer support in Charlotte and information technology positions in Cary. The company had about 140 workers in Charlotte before last week’s announcement.
“The strong business climate, access to universities and colleges and the desirable cost of living in North Carolina were significant factors in choosing to establish these new campuses in Cary and Charlotte,” MetLife executive vice president Eric Steigerwalt said.
The company also considered sites in St. Louis County, Mo., state documents show. MetLife had expressed interest about coming to North Carolina about nine months ago, said Lee Anne Nance with the Research Triangle Regional Partnership, an economic development agency.
The announcement comes after a North Carolina panel approved a tax break that could be worth up to $87 million over 12 years if MetLife retains the jobs and invests at least $113 million. The company said it will invest $125 million in the two new sites. The company also is receiving nearly $5 million from the state’s community colleges for training and a $2 million grant from another state fund.
Charlotte and Mecklenburg County are expected to vote next month to approve grants the two governments offered totaling $2.9 million. Cary and Wake County are expected to offer up to $4 million.
New York-based MetLife reported last month that its fourth-quarter profits plunged after it took $855 million in losses on derivatives, which are financial instruments often used to hedge against future price fluctuations of an underlying commodity or security. MetLife uses them to hedge changes in interest rates and fluctuations in foreign currencies.
Charlotte law and lobbying firm Moore & Van Allen represented MetLife in negotiations over the incentive package. Gov. Pat McCrory worked there before being elected governor in November. The Republican governor had no interaction with MetLife while at Moore & Van Allen, said his spokeswoman Kim Genardo.
“There was a complete firewall,” she said.
Since becoming governor, McCrory did not recuse himself from discussions over what would become one of the largest incentives packages in state history and was kept informed through aides, including state Commerce Secretary Sharon Decker, Genardo said. McCrory approved the $2 million One North Carolina Fund grant, but had no vote on the larger state tax incentive offering, Genardo said.
McCrory defended the size of the incentives package in a statement Thursday evening, saying the jobs will create revenue growth, not a net loss. There’s also no upfront cash to the company either, the governor said. States routinely try to outbid each other to lure companies.
Said McCrory: “This was a competitive situation.”