Developers see manufacturing steadily returning
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While we take time to celebrate the American worker this Labor Day, The Press looks at trends in the manufacturing sector, including interviews with local business owners, economic development officials, educators and others who see a resurgence in the sector.
Also in this special section, Joel Joseph, chairman of the Made in the USA Foundation who was instrumental in getting the American Automobile Labeling Act passed, offers a list of products made in the U.S. for consumers to consider. We’ve also included a list from some local retailers.
If you have questions about how the federal government defines a product as being made in the U.S. or if you have questions about the content of an item, the Federal Trade Commission has the answer.
We hope you find some value in this special package of stories and we wish you a happy Labor Day.
By J. Patrick Eaken
Press Staff Writer
The Regional Growth Partnership saw 11,526 jobs created or retained in Northwest Ohio during 2012, which equates to $1.7 billion of investment, says Gary Thompson, RGP vice president and director for JobsOhio Northwest Ohio Region.
Within the 17 counties of Northwest Ohio that Thompson oversees, the RGP completed 90 manufacturing projects.
In Northwood, Johnson Controls invested $3 million for an addition to its existing building and Fed Ex Freight constructed a new $15 million facility on the city’s west side.
In Oregon, Oregon Clean Energy is committed to hiring local contractors and union labor to build a new plant, which will be located on a 30-acre parcel on N. Lallendorf Road. Oregon Clean Energy has an option on an adjoining parcel if there is a need to expand the plant in the future, he said.
Developers of the planned natural gas-fired electric power plant expect to start to the construction of the $860 million project by the spring of next year. A construction schedule of 32 to 34 months is likely, will require 475 to 525 workers and about 1.5 million worker hours. They expect the plant to be operational by May 2017.
In Troy Township, a new project was announced in a sister sector to manufacturing — retail distribution. A plat to establish a new road and dedicate additional right-of-way along Pemberville Road in Troy Township for public use has been approved by the Wood County Planning Commission for a Home Depot warehouse and distribution center.
According to JobsOhio, Ohio has emerged as one of the top job creators in the nation over the past two years with companies committing to invest more than $13 billion. Ohio’s unemployment rate is below the national average and lower than regional states. Since January 2011, Ohio businesses have created nearly 150,000 new private-sector jobs.
Ohio is nationally recognized as a central business location that delivers easy access to customers and supply chains. The state is within 600 miles of 60 percent of all U.S. and Canadian manufacturing. Its world-class transportation infrastructure enables Ohio companies to move goods, supplies and resources cost effectively by road, rail, water and air.
“To provide faster and more effective delivery of officially licensed sports merchandise to our customers, we chose Ohio as our new hub. Ohio brings forward a highly skilled and dedicated workforce along with a pro-growth business environment. We are excited about the opportunity to expand our business into Ohio.” said Brent Trager, COO of Fanatics, a leading online retailer of sports merchandise.
Ohio’s $484 billion gross state product ranks it 8th in the U.S. and 27 Fortune 500 companies call Ohio home. A strength of the state’s economy is its wide range of well-established, growing industries, including advanced manufacturing, aerospace and aviation, agribusiness and food processing, automotive, bio health, energy, financial services, information technology services, and polymers and chemicals.
Development corporation officials are hailing this as signs most sectors are making a comeback.
“I would say at a regional level its improving and growing, may be a better word, but I’m sure there are still issues to deal with,” Thompson said. “We’re doing a lot in the automotive sector and we did a fair number of research and development projects, including a couple in glass, a couple in energy, and in food and logistics.
“The other sector that we use the term, but maybe others don’t, is advanced manufacturing, and that is people that make consumer goods or sporting goods, industrial goods — like Newell Rubbermaid that had a project in Wood County, somebody like Whirlpool in Hancock County that is making washers, dryers, dishwashers and things like that, and Johnson Controls in Northwood.”
Oregon Economic Development Foundation Director Lindsay W. Myers is noticing it, too. She has about 700 acres ready to develop, but says that cut be could down to 525 if two projects she’s involved with come to fruition and Oregon Clean Energy begins its construction.
“Since last year, manufacturing and all of its facets — there are so many you can be in — there has been such resurgence,” Myers said. “It’s great to see because there has always been a push to bringing back those jobs to American soil, which is great for our economy and our local citizens. We continue to see that uptick. We started to see a pick-up in different chemical projects, and while every project that we come across may not come to fruition, and it’s still staying there constant — here comes another advanced manufacturing firm and things like that. It’s really exciting to see.
“I’ve seen a pretty good uptick in chemical manufacturing, enzyme manufacturing, and some of the most obscure sectors that you really would never think about. That’s mostly what I’ve been seeing in our area and in our state, but also in some of the articles I’ve been reading — that’s kind of been the trend. It still seems to be a big focus for American manufacturers to produce as much as they can here on American soil.”
From 9 to 15 million cars
Of course, the American auto industry has seen the biggest upswing.
“There has been a lot of job gains among the automotive suppliers since the end of the recession, so I think there has been a general upswing in manufacturing jobs,” said Wade Gottschalk, director of the Wood County Economic Development Commission.
“Basically, in the automotive sector they’ve come from at the end of the recession to where they made eight million units a year, and now we right around 14 to 15 million cars a year, so that’s a big factor. The other reason is that for a lot of our automotive plants in Wood County, as the recession took its toll on the other suppliers, a lot of them were able to pick up more business. The American car manufacturers have recovered well and generally speaking the number of cars sold in America has increased substantially.”
What’s bringing industry back to Ohio? Thompson and Gottschalk say maybe doing business with Europe and Asia was not such a good idea after all, and companies are finding that out.
“I think the biggest hit has been the businesses in the county that have been doing business in places like Europe,” Gottschalk said. “Europe has not been doing as well as the U.S. has, and so that has impacted multiple manufacturers throughout the country where maybe European business has been selling off, but maybe U.S. business has increased.”
Thompson admits that Ohio still has to compete with the rest of the country.
“One of the things that we hear from the financial side of companies is that when you look at Ohio, if they look just to do distribution, we are competitive but maybe other places down south beat us out every so often,” Thompson said. “If you look at just manufacturing, we’re competitive but sometimes still overseas in the Asian market, and I wouldn’t just say China, but I would add Korea and those places are also very competitive with us. But, when they look at the whole packaging and try to put manufacturing with distribution, we win almost every time on the economics side and other risk factors.
“I think globally, the tsunami really threw the auto world — it kind of turned Japan on its side. Instead of shipping all these parts in to places like Honda and Toyota that are sprinkled around our state they are certainly now thinking about building and manufacturing those parts locally, or at least some percentage of them. We’re seeing a lot of interest in activity around that thought process.”
John Minor, JobsOhio’s President and Chief Investment Officer, said, “Business leaders are noticing what is going on in our state and that’s driving JobsOhio’s project pipeline,” Minor said. “We are seeing more potential new jobs because of our growing pipeline. We are now more focused than ever on our sales efforts, and the state is working together as one, which is very powerful for job creation.”