Earlier this month, DXC Technology, a $25 billion IT services giant created from the Spring merger of CSC (Computer Sciences Corp) and the Enterprise Services business of Hewlett Packard Enterprise, announced their choice of location for their first U.S.-based Digital Transformation Center: New Orleans, Louisiana. The 2,000-employee Center, which will be placed in the city’s downtown district, will also result in the state’s largest public-private partnership to support higher educational institutions, specifically in STEM training.
DXC chose New Orleans after a site selection process that involved over 30 possible U.S. cities. The state of Louisiana came up with an incentives package that totaled over $100 million, along with additional benefits contributed by city government, to lure the company to its final choice.
Part of that package is $25 million that will go towards increasing and improving STEM education programs at Louisiana colleges and universities, to train DXC’s future workforce.
“Our partnership with this industry leader and Louisiana Economic Development will enable us to create and enhance curricula, further develop our world-class faculty and produce a workforce that gives the greater New Orleans region a competitive advantage,” said University of Louisiana System President/CEO Jim Henderson.
Those educational institutions include four-year universities Louisiana State, Southeastern Louisiana University, and the University of New Orleans; as well as Delgado Community College in New Orleans. DXC will help advise and recommend technology education programs for students, and the schools will provide development opportunities for DXC employees.
The commitment is the state’s largest higher education investment in a private-sector workforce partnership.
DXC, in return, will recruit these newly-trained technical students and grads for internships and jobs. It’s a big opportunity for a school like the University of New Orleans, who sees 97 percent of students remain in the state following graduation.
Though the incentive dollars sound high, economic projections indicate it will be well worth it. The Digital Transformation Center is slated to begin operating in January, employ 300 in 2018, and be at full employment capacity in five years — and a research group at LSU estimated the project will translate to about $64 million in new state taxes, $868 million in earnings, and a total economic output of $3.2 billion from 2018 through 2025.
At full capacity, the Center will represent a 12 percent increase in tech employment in the New Orleans metro area, according to NOLA.com. And in addition to the software development, engineering, project management, and other jobs the Center will directly ensure, Louisiana Economic Development estimates over 2,000 additional indirect jobs will result.
Partnerships like this could help boost the state’s rankings in innovation measurements like the Information Technology & Innovation Foundation’s State New Economy Index, which in this year’s report ranked Louisiana as 46th overall — 47th for Workforce Education and 44th for High Tech Jobs.
Both local officials and DXC executives touched on the opportunity to boost Louisiana’s technology industry standing overall.
“It is fitting that DXC is opening a ‘Transformation Center,’ because we fully expect the impact to be transformative to both DXC, as a new global technology leader, and New Orleans, as a new national technology hub,” said Michael Hecht, President & CEO of Greater New Orleans, Inc., in a statement.
“We look forward to establishing our local presence and, as a vital partner, contributing to the recognition of New Orleans and Louisiana as leading technology and growth centers,” said Mike Lawrie, Chairman, President, and CEO of DXC.
DXC currently operates Digital Transformation Centers in the UK and Belgium, and coming soon, Australia. They focus on the application of cutting-edge technologies in areas including cloud computing, cybersecurity, data analytics, and intelligent automation for DXC’s clients.