Report: Valley depends on manufacturing
Youngstown Vindicator - May 11, 2012
The Mahoning Valley remains the part of Ohio most dependent on manufacturing, according to a national report.
The report is by the Brookings Institution, which surveyed 100 metropolitan areas in the nation. Brookings is a nonprofit public-policy organization based in Washington, D.C.
In the Valley, manufacturing jobs represent 12.6 percent of all jobs, which ranks eighth nationally. The Valley is more dependent on manufacturing jobs than any other part of the state, although Akron and Cleveland are close, ranking 13th and 14th, respectively.
The area has 28,416 workers in manufacturing jobs. The Mahoning Valley had lost 46.2 percent of manufacturing jobs compared with 2000, according to the Brookings report.
The region made a comeback in the past two years with manufacturing jobs increasing by 11.7 percent between the first quarter of 2010 and the fourth quarter of 2011. The increase ranked third nationally, according to the report.
At one time, dependence on manufacturing was even greater, said Tony Paglia, vice president of government affairs for the Youngstown/Warren Regional Chamber.
“I think we have an infrastructure in place for manufacturing,” Paglia said. “We have diversified within manufacturing.”
At one point, nearly all manufacturing businesses within the Valley were related to steel or metals, Paglia said.
The Mahoning Valley Manufacturing Coalition believes the high percentage of manufacturing jobs is good.
Spending for manufacturing has a greater multiplier effect than any other industry, which means more money into the area’s economy, said Jessica Borza, coalition executive director.
“Things were down for so long that the companies that survived have come back stronger. They’ve learned to diversify within their products and customers,” she said.
Coalition members, in a survey, estimated their companies would grow 33 percent in the next two to three years, Borza said. Those estimates do not include any anticipated growth from manufacturing for oil and gas companies.
The Valley needs to take advantage of what it can in terms of manufacturing jobs, Paglia said.
“We also need to have a strategy for continuing to diversify,” he said. “There are always cycles in the economy, and we need to prepare.”
Nationwide, the Brookings report shows that American manufacturing has shed its Rust Belt image and become more diversified and advanced. The report finds that U.S. manufacturing is located largely in metropolitan areas, and the long-term shift of manufacturing to the South came to a halt in the past decade.
What is needed now, the report concludes, is a national policy that plays to regional strengths and supports development of innovative “high-road” manufacturing in U.S. metropolitan areas.
“We can pave the high road, or we can block it,” said Susan Helper, an economics professor at Case Western Reserve University and co-author of the Brookings study. “We can make investments in training, in research and development, in infrastructure, or we can watch things crumble. We can take advantage of the synergies that are happening on the ground, or we can squander the energy that’s building.”
In Northeast Ohio, a coalition of 80 civic leaders, including some from Youngstown, developed a regional plan that has a strategy for helping manufacturers adopt new manufacturing methods, develop new products and reach new markets.
“A lot of economic development has been geared toward changing a region’s blend of industries or creating something like ‘the next Silicon Valley,’” said Tim Krueger, a research assistant with Policy Matters Ohio and a study co-author. “Yet the data show nearly every metropolitan area already has an important set of core competencies. New economic thinking should be geared toward recognizing these strengths and building on them in creative ways.”