SALEM Economic outlook for industry stays bleak
The speaker forecasts an Ohio boom in research and medical technology.
SALEM -- Richard and Michael Grimstad left Friday's Salem Chamber of Commerce Economic Forecast luncheon disheartened.
Though times might one day turn sunny, the forecast, given by Rick Yocum, Ohio Public Expenditure Council president, is rain, rain and more rain for 2005.
The father and son who own RAG Tooling, a manufacturing company at 12750 Salem-Warren Road, hoped to hear a granule of hope for the coming year but came away without much.
Yocum said the state is struggling to fund the 2005 budget. To add to the short-term grimness, there isn't a lot being done for manufacturing businesses like the Grimstads', they said.
Yocum talked about Ohio's business boom in research and medical technology as a hot plate for what could bring 100,000 new jobs. But Richard Grimstad pointed out in the luncheon that 180,000 jobs have been lost in Ohio. And unfortunately for folks like the Grimstads, the new economic promise is in the wrong area.
"I was disappointed in the fact that the state of Ohio is relying on the hope of a break in technology to help the economy," Michael Grimstad said.
Richard began the company, which makes specialized tools, in May 1967 when Salem was dubbed "the little Detroit" for its automotive parts production.
Times were booming for manufacturers then, and customers were found on the corner, not 250 miles away like now.
Yocum said the good news for a town like Salem -- hit hard by several plant closings in the past few years and more planned -- is its uniqueness.
"I don't think it's typical," Yocum said. "It's still fairly vibrant. ... I can take you to a lot of cities in the state this size, and they'll be empty."
A drive down State Street shows a bustle of service-oriented businesses. It might be a far-cry from better financial times, but there are sparks, Yocum said.
The short-term reality, however, is that Ohio is about $4 billion to $5 billion short of balancing its checkbook this year, Yocum said. Two ways will fix the problem: Either increase taxes, of which 90 percent go to education, health care, or correctional facilities; or slice programs. Neither option is popular.
"We're fresh out of smoke and mirrors," he said.
You have to be creative, Yocum said, when approaching time-honored institutions like schools and hospitals. He suggested considering things such as two-day school weeks where students would stay at home and work on computers for three or more days a week, thereby reducing overhead for school systems.
Addressing the problem of businesses leaving the area after establishing themselves in Ohio, Yocum offered a unique solution: If the state can tie budding businesses to the area through stocks, the jobs stay even after the company develops products.
"I really think there is a bright future on the horizon," Yocum said. "I don't want the short term to drag you down."
For some, it's still feels like a drag. After four years of losses and cutting their staff from 33 to 13 employees, the Grimstads might not be able to wait for the sunny, "bright future."
"If there is such a thing," Michael Grimstad said.