Some dispute claims of widespread job growth in Valley
‘Much more is said than done,’ McKelvey says
By Courtney Denen
Have you ever read local agency reports that celebrate “creating 2,000 jobs in the Valley last year?”
And then, like many of us, wonder: Where were 2,000 jobs created?
About $1 million is spent annually on Mahoning Valley economic and job development. But views differ on whether these efforts are enhancing economic recovery.
Some authorities say Youngstown is on the brink of an economic breakthrough, evidenced by a third shift at Lordstown’s GM plant, the investments in downtown jobs at VXI’s call center and business development at the Youngstown Business Incubator.
Others say the local economy is no better now than the day the mills closed, that the Valley has remained economically stagnant for 33 years.
“Black Monday” hit hard in 1977. Tens of thousands of jobs were lost, and by November 1982, Youngstown had the highest unemployment rate in the nation.
Since 1982, the Valley has faced the constant need for jobs. Many organizations are charged with economic development and job creation.
Warren and Youngstown each has its own economic development offices. The Ohio Department of Development has an office in Youngstown. Private organizations such as the Mahoning Valley Economic Development Corporation and congressional offices coordinate efforts through the Youngstown/Warren Regional Chamber.
AGENCIES ARE NOT REALISTIC
John Russo, co-author of “Steel Town USA” and professor of labor studies at Williamson College of Business Administration at Youngstown State University, said local economic development agencies are not realistic.
“They are trying to put a good face on things. I don’t know what’s going to make Youngstown all that different from other places.”
Lifelong Youngstown resident and former Mayor George McKelvey called the competing economic development organizations “overdone.”
“It’s almost as though to solve our unemployment problem, we had to create a lot of economic development agencies to hire people to work in these agencies, and the only thing they were doing was developing their own jobs,” McKelvey said.
“When it’s all said and done, much more is said than done,” McKelvey said.
VERIFYING NUMBERS ISN’T EASY
Independently verifying the number of jobs created and the associated costs is difficult.
In the Regional Chamber’s community report card summary for 2006 and 2007, the MVEDC boasts it had “retained or added 16,000 jobs.”
Walter Good, vice president of business retention and expansion at the chamber for 14 years, said the number is a rough estimate of jobs created since the MVEDC started in 1979. Good was unable to provide evidence for those 16,000 jobs.
Repeated attempts to confirm numbers provided by agencies led to similar results.
Many entities assisting job creation, including the MVEDC and the office of U.S. Rep. Tim Ryan of Niles, D-17th, claimed not to maintain such records.
Gloria Mathews, communications assistant for the One-Stop workforce system of Mahoning and Columbiana counties said, “It’s very difficult to get a good solid number for job creation because so many individuals, agencies and groups are involved in the process.”
Many public-records requests and other inquiries yielded mixed results.
The Youngstown Office of Economic Development claimed to have created 553 jobs during the past five years. Salaries for three members of the YOED staff in 2009 totaled $144,589, including fringe benefits.
Sarah Lown, incentive manager for the YOED, could not provide the office’s budgets from 2005 through 2008.
“We fold our budget into the finance office in our audited statement, so it gets watered down,” she said via e-mail.
Lown said, in most cases, those 553 jobs are still in place in businesses such as Coronado Steel, DiRusso Sausage, Cedar’s Lounge, Blackline Materials Inc. and A-1 Concrete.
“The city’s strategy is to assist those companies who have already been vetted by the banks,” she said. “The term ‘job creation’ is used mostly in follow-up monitoring.”
NUMBERS & MORE NUMBERS
The Ohio Department of Development claimed to have created 2,143 jobs in Region 12 – Mahoning, Trumbull and Ashtabula counties – from January 2007 through December 2009. To create these jobs, a staff of five earned $917,654 in three years.
Katie Sabatino, public information officer for communications and marketing division of the Ohio Department of Development, said via e-mail, “Some of these projects are proposed jobs that are to be created in the near future.”
The Regional Chamber says it created 1,052 new jobs in 20 different companies in 2009.
Good said when companies want to expand, they contact the chamber for assistance. Like other agencies, the Chamber does not maintain specific paperwork to verify those new jobs.
The chamber typically raises $500,000 a year for economic development.
In addition, the companies’ own money goes into job creation, as in the case of V&M Star, a steel company planning expansion.
“They’re going to create 350 jobs, and they’re going to invest $650 million,” Good said.
NO MORE DELPHIS
Heather McMahon, communications director for Ryan’s office, said though there are no quick fixes in economic development, small businesses are the future of the economy.
“There’s not ever really going to be another Delphi. There’s not going to be another GM,” McMahon said. “When Delphi came in the mid-’60s they hired 14,000 [people] to start working there. That’s just not being done in America anymore,” McMahon said.
She added that for job creation, smaller businesses are safer investments than big businesses that may collapse in an unstable economy.
“When 14,000 people are working at a plant and there’s a problem, then 14,000 people are laid off,” she said.
“The good thing about small business is it makes us much stronger, economically speaking.”
“The reason we are going to succeed as a community and we’ll never experience another Black Monday is because now we’re diversified,” he said. “We are hurting. But our recovery will be faster because of where we are right now.”
Good agreed Youngstown has “turned a corner.”
“We’re moving in a direction of being a much more diverse economy that’s not just reliant on steel and auto as we were for many years,” he said.
SCARED ABOUT FUTURE
Russo doubts there’s an easy recovery from the current recession and warned, “I am very scared for what the next decade could be like.”
“I know that other people want to look at the city optimistically. But we’ve got to look at the hard realities of what’s happened here and what continues to happen here,” the YSU professor said.
“We can produce new jobs in call centers. We can produce new jobs in some of the high-tech industries. But they don’t come anywhere close to the types of employment that’s needed to revitalize this area.”
The NewsOutlet is a joint media venture by student and professional journalists and is a collaboration of Youngstown State University, WYSU radio and The Vindicator.