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Economic impact of manufacturing losses in valley



Published: Sun, October 6, 2013 @ 12:00 a.m.

By Ed Runyan | runyan@vindy.com

Though the area where most of us live is called the Mahoning Valley — generally thought of as Trumbull and Mahoning counties — the two have not had the same economic history over the past decade.

The two counties have been regarded as almost twins — collectively one of the mighty industrial centers of Ohio.

But while both counties shared the Steel Valley name for their vast steel-making facilities along the Mahoning River, the decline of steel making in the two counties did not run along parallel tracks.

The Youngs-town area made national news in 1977, Black Monday, when Youngstown Sheet & Tube Co. announced it would close its Campbell Works, eliminating 4,100 jobs. About 35,000 more Youngstown-area steel- related jobs were lost over the next five years, according to the Center For Working Class Studies at Youngstown State University.

By 2001, Mahoning County had only 12,000 manufacturing jobs of any kind left, according to the U.S. Bureau of Labor Statistics.

Trumbull County, however, still had two large steel makers (the former Copperweld and the former WCI), plus General Motors Lordstown and Packard Electric in Warren. The four together employed about 17,000 in high-paying jobs.

“We still had our manufacturing base,” said Mark Zigmont, a longtime economic development planner for Trumbull County. “But [Mahoning County] had to confront [deindustrialization] much earlier.”

Manufacturing nationwide continued to decline in the 2000s and beyond, causing more job losses in Trumbull County than in Mahoning. Today, Mahoning County has about 9,000 manufacturing jobs, a loss of 3,045 jobs (25 percent) since 2001, while Trumbull has about 12,500 manufacturing jobs, a loss of 15,728 jobs (56 percent).

Trumbull’s manufacturing losses also translated into overall job loss, causing a downward trend in total jobs between 2001 and early this year and total income for Trumbull residents.

Mahoning County’s total jobs loss was half of Trumbull’s over those 12 years. And Mahoning’s total wages actually increased, though at less than the state average.

Poverty rates in Trumbull County also increased at a higher percentage than in Mahoning County, according to U.S. Census data.

Mahoning County’s poverty rate is 17.1 percent, which is higher than Trumbull County’s 16.4 percent, but Trumbull’s rate increased more over the decade (6.1 percent) than in Mahoning County (4.6 percent) or statewide (4.5 percent).

tough times

Problems at Trumbull county manufacturers such as CSC (former Copperweld), GM Lordstown, Packard Electric and WCI became apparent throughout the 2000s and beyond. About 8,500 jobs were lost at GM and Packard. About 2,500 more were lost at CSC and WCI.

“You had 10,000 more people here making 120 percent to 130 percent of the standard wage of about $55,000. And over a number of years, those jobs were gone,” Zigmont said.

Trumbull County didn’t have a Black Monday, but Zigmont said the county’s worst setback involved Delphi Packard Electric, which employed 5,000 people in good-paying jobs in late 2005, when it filed for bankruptcy protection, about 8,000 in 2001 and about 2,000 at three locations in Trumbull County now.

Trumbull County’s manufacturers were doing the same thing throughout the 2000s that manufacturers were doing across the United States — outsourcing their work to other parts of the United States and to other countries and automating so that they needed fewer workers, Zigmont said.

One symbol of the loss of Trumbull County manufacturing jobs is the change in the commercial corridor along U.S. Route 422 in Niles and Warren once known as the “Strip,” Zigmont said.

It once contained more four-star restaurants than almost any place in Ohio, but nearly all of them are gone.

“You had people who could go to the better restaurants, go on vacations, a pool in the yard,” Zigmont said, adding that the loss of those good-paying jobs is also generational.

“Not only did those people lose those jobs, but the next generation didn’t have the opportunity to get those jobs,” he said.

“You had a good, solid middle class. You could send your kids to college, have the car, the boat, the house,” he said.

The city of Warren also lost some pride when it lost manufacturers such as Halsey Taylor, the drinking-fountain manufacturer.

“Everybody when they took a drink, all over the United States and probably outside of the U.S., they saw Warren, Ohio” on the drinking fountain, he noted.

RECESSION’S IMPACT

Calamity struck Trumbull County in 2009, when the Great Recession caused the Lordstown GM plant to scale back to one shift just before the company’s bankruptcy filing. At the same time, RG Steel (then known as Severstal) temporarily closed.

The city laid off 40 workers, most of them police officers and firefighters. “We’ve lost all of our manufacturing base,” said Warren’s mayor at the time, Michael O’Brien.

The Rev. Chris Gilger, executive director of Warren Family Mission, said he sees the social ills that have resulted from lost good-paying jobs every day at the mission, which he founded in 1998 in a house on Niles Road.

“Our guys are up at 5 a.m., and they go to Labor Ready. Sometimes they get jobs,” he said of the large number of males, mostly 18 to 25, who stay at the mission and try to get temporary work.

“All over the country, missions are full of kids,” he said. “Originally it was guys falling through the cracks 50 years old with poor health and bad habits.”

Many in this generation are working several part-time jobs “just to keep an apartment,” but many use cash-advance businesses, so they are always a paycheck behind, have no savings and “are one paycheck away from having to go to the missions.”

“You never own anything,” he said of finding only part-time work. “You’re on a treadmill. You’re just in survival mode. You’re not able to keep anything.”

That lifestyle leads to hopelessness and heroin use, in many cases by young people who played sports and got hooked on pain medications, the Rev. Mr. Gilger said.

The mission’s newest location is on U.S. 422 in Warren, just west of the area formerly known as the Strip. It’s new nickname could be Thrift Alley, because thrift stores have become the dominant industry, with three near the mission and others in walking distance.

Bim Turner, workforce administrator at the Trumbull County One-Stop jobs office in Warren, said the advent of the shale industry in the Mahoning Valley has come at a good time, producing jobs at Vallourec Star in Youngstown, TMK-IPSCO in Brookfield and many other companies.

“It’s not too often you get a second chance on your economy,” he said. “We’re lucky.”

Job orders placed with the One-Stop by local companies indicate that Trumbull County’s job picture is improving. The loss of manufacturing jobs is also forcing the community to have a more diversified set of employers while still holding onto General Motors as an “anchor,” he said.

“The area has been through the roller coaster,” he said. “We roll with the punches, and we come back.” According to the Bureau of Labor Statistics, Trumbull lost 8.6 percent of its workforce between December 2008 and December 2009 — 54 percent of it from manufacturing — the most severe job loss, percentage-wise, among the nation’s 334 largest counties.

George Zeller, a Cleveland economic research analyst, published a paper in May 2011, analyzing the period from late 2001 to late 2011, showing that manufacturing employment across Ohio dropped 32 percent during that decade. Other big losses were in construction (29 percent) and information (26 percent).

Trumbull County had lost 49 percent of its manufacturing over that decade, the largest loss of any county in Ohio. Mahoning County lost 30.5 percent of its manufacturing, the 11th highest percentage in the state. Columbiana County lost 33.9 percent, the eighth highest.

The national and local economies improved in the years since 2010, but updated statistics from the Bureau of Labor Statics show that Trumbull County manufacturing has not, as job losses continued at the RG Steel, General Electric and other plants.


Comments

1birdseed(66 comments)posted 1 year, 1 month ago

who is responsible? the e.p.a. forcing 80 year old plants to conform to clean air and water regs in an unreasonable time frame, the u.s. congress for not reigning in the e.p.a., and the american people for buying foriegn cars. we did it to ourselves.

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2Brkfldwrrr621(12 comments)posted 1 year, 1 month ago

Its our fault keep buying foriegn cars this new generation does't understand just because a car or product is assembled here doesnt mean your buying american the money doesnt stay here if its a foriegn company

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3UticaShale(854 comments)posted 1 year, 1 month ago

We need to shut down the new fracking too. Let the MidEast sell us the oil, the government will provide.

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4author50(1121 comments)posted 1 year, 1 month ago

Good story. Go to the Rescue Missions, Food Banks, etc., you will be stunned. The economy has been kept going by the FED printing 94 billion dollars a month to prop up Wall Street, big banks, big corporations, state governments, county governments and local governments.

Best example of why the bailouts were a joke on the people. Wall Street, banks and loan servicers were caught illegally foreclosing on people. they paid huge fines to the FEDs. The FEDs turned the money to the states who put their portion into their own general fund. Not one PENNY was ever doled out to anyone who was illegally foreclosed on (SOURCE: Neil Baroksy, former inspector general for TARP. A democrat hired by Bush and FIRED by Obama).

Second best (and local) example: All the GM employees brought to Lordstown from all over have been bought out or forced to retire from their $30 an hour jobs. Replaced by people making $14 an hour.

It's going to get worse, because we missed our chance to reform the system in 08-09.

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576Ytown(1264 comments)posted 1 year, 1 month ago

The ACA is bringing even more Americans into poverty. Companies are reducing work hours and laying off employees. Health care insurance premiums, co-pays and deductibles have skyrocketed. The Medicaid expansion promises to subsidize your insurance costs if you make 138% of the poverty level as people are forced into more government dependency. We are on a downward spiral. Freedoms that were fought for are now insidiously being taken away. America is being fundamentally changed as promised.

People do not want to be dependent on the government, we want less government. They want jobs, they want to be self-sufficient, they want their dignity.

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6redeye1(4629 comments)posted 1 year, 1 month ago

The CHANGES that everyone has voted for is about t come to true. More poverty then ever before because of ACA. The greatest divisional gap between the rich and the poor is going happen. You see all the changes that OBAMMY had promised are just starting to come true. So yunz better get ready, this country is going to hell and fast . Thanks OBAMMY voters !

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7JoeFromHubbard(1090 comments)posted 1 year, 1 month ago

@ birdseed:

You have restated my long time position that the EPA is partially responsible for the demise of the steel industry in the Mahoning and Shenango.

Obama and his EPA are now doing the same thing to the coal industry while claiming to be job creators.

Our own government will be the cause of the downfall of this country.

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8DACOUNTRYBOY(258 comments)posted 1 year, 1 month ago

Obama never had to do any physical labor to get a paycheck and he figures others shouldn't have to either.

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9Aware(221 comments)posted 1 year, 1 month ago

767 - Companies have always had part-timers to avoid offering the benefit packages. And many forms have reduced hours or cut positions due to the recession - there is zero evidence - beyond what fox reports - that hours are cut as a direct 'result' of the ACA. My premiums have gone down...and my co-pays have shrunk dramatically! The deductible if higher on the plan I selected, but that is not a concern at all! Actually, given the reduced co-pays and lower premium, it's a wash. ..Yes, people want jobs - I fail to see how this insane shutdown by the teatards is helping with that. Incidentally, the voters chose this President, along with his plan for the ACA - his re-election stands. And it's high time these government reps honor the will of the people. I hope they're all voted OUT.

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10paulydel(1322 comments)posted 1 year, 1 month ago

These are some great comments and truthfull too. We are in big trouble and you still have these diehard Obuma fans because they are either on a free ride or as we politely put it underinformed.

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11JoeFromHubbard(1090 comments)posted 1 year, 1 month ago

@ olddude:

From another old dude, it's called "near net manufacturing." No extra beef in the design.

Handle with care and a prayer.

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1276Ytown(1264 comments)posted 1 year, 1 month ago

olddude: Good that you were able to fix it yourself, typically the cost of the repair is equal to the cost of a new one!

Most brands are no longer made in the USA. Here's how Walmart ships to the US. http://www.bore-head007.newsvine.com/...

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