Local News

Citing HB2, Deutsche Bank freezes 250-job expansion in Cary

Posted April 12, 2016 10:32 a.m. EDT
Updated April 12, 2016 6:31 p.m. EDT

— Deutsche Bank on Tuesday announced that it will freeze plans to create 250 jobs at its Cary location due to House Bill 2, which sets statewide discrimination policy.

The announcement on the company's website said the statewide legislation "invalidated existing protections of the rights of lesbian, gay, bisexual and transgender fellow citizens in some municipalities and prevents municipalities from adopting such protections in the future."

House Bill 2, which was signed into law last month after a one-day special legislative session, prohibits transgender people from using public bathrooms that align with their gender identity, excludes gays, lesbians and transgenders from discrimination protection in employment and public accommodations and bars cities and counties from extending such protection to them.

Deutsche Bank employs 900 people at its software application development center in Cary. In September 2015, the bank announced its plan to add the 250 jobs through 2017 and invest $9 million there through the end of this year. North Carolina agreed to provide about $3.3 million in incentives for the expansion.

In a statement, Co-Chief Executive Officer John Cryan said, "We take our commitment to building inclusive work environments seriously. We’re proud of our operations and employees in Cary and regret that as a result of this legislation we are unwilling to include North Carolina in our US expansion plans for now. We very much hope that we can re-visit our plans to grow this location in the near future."

Deutsche Bank's move is the latest economic fallout from House Bill 2. PayPal last week canceled plans for a 400-person, $3.5 million operations center in Charlotte, and Bruce Springsteen canceled a weekend concert in Greensboro because of the law.

Denny Edwards, chief executive of the Raleigh Convention & Visitors Bureau, said his staff is getting calls daily from groups across the country concerned about bringing their events to the city because of the new law.

Four conferences scheduled for Raleigh have already canceled, costing the area about $700,000 in economic impact, Edwards said. Another 16 groups have said they are now on the fence about hosting an event in Raleigh, which could mean a loss of another $24 million for the local economy.

One conference organizer sent the following note to the CVB: "I am troubled by the state's recent anti-LGBT law. Many of my colleagues may boycott the state of North Carolina. How can I be assured that LGBT conference-goers won't face discrimination when they try to make arrangements for housing, dining, etc.? What if we want to bring our same-sex partners? Our society may need to move or severely downscale our plans for Raleigh."

"These are real people, real conferences, that have a history of meeting here every year. The cancelations we have are real," he said. "It's going to have a direct impact on the county in terms of tax collections, and certainly, jobs are going to be eventually impacted."

Last year, people attending conferences and conventions in the Raleigh area generated $3.2 billion for Wake County.

Still, Edwards said he believes it will take a big name to effect any change in the law.

"Unfortunately, some of these conventions are not sexy in name. They certainly generate a lot of economic impact, but it's the sexy ones like the NBA All-Star Game or major concerts like the Bruce Springsteen concert that will raise awareness," he said.

Downtown businesses, especially hotels and restaurants, count on conventions and similar events to keep their seats and rooms filled, and any losses could be significant.

"Sometimes our business is up 30 to 50 percent when conventions are in town, so the hit could be big," restaurateur David Meeker said. "Everybody's been talking about it. It's top of mind."

Rep. Nelson Dollar, R-Wake, dismissed talk of a major economic impact to North Carolina from the law.

"The vast majority of companies in north Carolina, doing business with north Carolina, are not making moves adverse to the state," Dollar said, adding that an executive order Gov. Pat McCrory issued Tuesday should clarify the law's provisions.

Raleigh's CVB is working with its counterparts in other cities across the state to craft one message making sure people know North Carolina is open for business for everyone, Edwards said.