The American tool and die industry is on course for noteworthy growth at a pace of 3 to 4 percent annually through 2020, the U.S. Bureau of Labor Statistics reports.
And thanks to the expertise of a 57-year-old Youngstown company, its forward-thinking Italian parent firm and support from city leaders, the Mahoning Valley likely will find itself on the cutting edge of that industrial growth.
The city company, Youngstown Tool & Die Co., plans to invest more than $13 million to construct a new state-of-the-art plant, add equipment and hire close to 60 new employees.
That growth is part of a broader mission by its parent company, Phoenix International S.p.A. (Societ per azioni or public company) of Verdello, Italy.
Phoenix rises as the leader in the European Union in the production of molds (dies) for aluminum extrusion. According to the company’s website, it’s now on a trajectory for growth in the New World, and it has chosen YT&D as its first major investment in the United States.
That selection is most certainly a feather in the cap for the Poland Avenue company and the quality of its craftsmanship.
To facilitate that expansion, the company aims to build a 60,000-square-foot plant on 10 acres in the Salt Springs Road Business Park. If all goes well, tentative plans call for a later expansion of 30,000 square feet of additional work space there.
We’re pleased with and thank leaders of Phoenix International for their trust in the YT&D, and the Valley as its launch site for its entry into the U.S. market.
The investment comes at a propitious time as recently implemented steep tariffs on aluminum imports should stimulate the U.S. market. Both YT&D and Phoenix specialize in providing custom-designed aluminum extrusion dies.
The region also boasts a strong and talented workforce. Ohio ranks second in the nation in the size of its tool and die industry, and the Youngstown-Warren-Boardman metro area boasts 540 workers in it, according to 2017 federal data.
STIMULANT FOR ECONOMY
The investment bodes well not only for the company but also for the economy of Greater Youngstown. An additional annual payroll of $2.5 million will have spinoff impact throughout the Valley.
In addition, the skilled jobs pay well. The average wage of a tool and die maker in the Valley last year was $54,000, with those in top tiers making as much as $80,000, the Bureau of Labor Statistics reports.
The new investment also offers a ray of hope for Youngstown government’s precarious finances caused by a shrinking tax base. The increased income tax from 57 new employees will help offset losses in other sectors in the city’s economy.
Of course, the city and other entities won’t receive full tax benefits from the new development. That’s because the expansion commitment by YBI rides on the company receiving tax abatements common to most development projects.
To its credit, Youngstown City Council on Wednesday expeditiously approved the incentive package, which includes a 10-year 75 percent cut in real-property tax payments.
Some, of course, will wince at the notion that City Council, like most public entities, increasingly must accept sacrifices to lure new jobs. Consider the billions of dollars in tax incentives powerhouse Amazon seeks from cities vying for its new headquarters.
The bottom line, however, remains that far more winners than losers tend to result from such lures. And the company will still pay an estimated $218,000 in real-property taxes over the 10-year abatement. That’s clearly better than nothing.
And according to a March 2018 report from the Brookings Institution, the estimated $90 billion per year that states, cities and counties dole out in incentive packages prove particularly beneficial if they’re “properly targeted, transparently deployed and rigorously evaluated.”
We agree and call on Youngstown leaders to monitor YT&D to ensure it fulfills its promises. We’re confident the city will do so, as council recently acted to order Rudick Forensic Engineering to pay backtaxes for failing to live up to the hiring terms of its 2009 incentive package.
Council also took several other actions this week that bode well for development and job creation in the city. They include purchase of an East Side church property to facilitate expansion of Joseph Co. International ’s chill-can plant, providing a water grant to assist Eastern Gateway Community College in its expansion into the Harshman Building downtown with 20 new jobs and demolishing a large abandoned professional building across from St. Elizabeth Youngstown Hospital with an eye toward future development.
For now, however, time is of the essence for the YT&D project. Developers say they plan to break ground once the incentive package is finalized. We therefore urge the city’s Board of Control to do so as expeditiously as possible in order to promptly lay the foundation for Youngstown’s newest growth industry.