Williams Sees Valley as ‘Bellwether’ for Nation
BOARDMAN, Ohio -- Former Youngstown Mayor Jay Williams said the Mahoning Valley serves as a model for other communities across the country, citing its leadership role in the automotive industry, energy, and pioneering efforts in advanced manufacturing.
"The extent that we could be both a laboratory where we're willing to take certain risks and try things, and a bellwether that can be a pathway that other communities would follow, bodes well for the Valley," Williams said after delivering the keynote address at the Youngstown-Warren Regional Chamber's annual Economic Forecast Breakfast at Mr. Anthony's.
Williams, executive director of the U.S. Office of Recovery for Auto Communities and Workers, is also President Obama's nominee to head the Department of Commerce's Economic Development Administration.
On Thursday morning, the U.S. Senate Committee on Environment and Public Works voted to recommend Williams' appointment. Confirmation now moves to the full Senate for a final vote.
"The president's message of opportunity, action and optimism is relevant to what is happening here," Williams told a packed house of about 500, a large audience for the event.
The former mayor emphasized the Obama administration's decision to create the first of 15 advanced manufacturing hubs in Youngstown. The National Additive Manufacturing Innovation Institute, branded as America Makes, serves as a template for other communities slated for these centers.
"The president now has announced a second one in North Carolina," Williams noted. "His desire and intent to open more of those across the country is indicative of the fact that this area is going to be critical in capturing some of this renaissance in manufacturing."
Williams emphasized that President Obama's reference to Youngstown during the last two State of the Union addresses is very significant, adding that representatives from other communities lobby hard for a shout-out during the speech.
For Youngstown to earn mention in the president's address on two occasions validates the success and direction of the community, Williams said.
He also singled out the auto industry and in particular General Motors Co.'s Lordstown plant: "GM Lordstown has played a key role in the success of the corporation."
Williams referred to Lordstown as the "go to" plant that GM looked to as it restructured its business in 2009. "While the rescue of GM was good for GM Lordstown, GM Lordstown was good for GM the corporation. When it came to producing a high-quality, world-class small car that could move toward profitability, GM Lordstown got the call."
The auto industry has added 370,000 direct or indirect jobs since the government-backed bankruptcy of GM and Chrysler, Williams said.
This year, auto sales are expected to exceed 16 million units versus 10.3 million units in 2010, he reported. "We're building world-class autos with respect to design, technology and efficiency," he said.
All of this points to a general "manufacturing renaissance" occurring throughout the country, but one in which the Mahoning Valley has a large role to play, Williams added. Vallourec Star's $1 billion new fine quality mill in Youngstown, for example, not only brings more manufacturing jobs to the region, but contributes to the United States' drive to become energy independent and less reliant on foreign oil.
The Youngstown operation manufactures tube used in oil and gas exploration. Williams noted that by 2040, it's expected that 15% of natural gas produced in the United States would be exported, while another 5% of oil produced here would be for export.
As for his potential position at the EDA, Williams stated that while small, the division is the only federal agency devoted specifically to economic development. "It's a core component of the economy and the middle class," he said. "It's not large, and it's not as well funded" as other agencies.
However, funding critical infrastructure projects, economic adjustment programs and establishing partnerships with the private sector are among EDA's mission, Williams said. In recent years, the agency has provided funds to several entities that support the Mahoning Valley.
Among these awards were $219,000 to Youngstown State University and the city of Youngstown; $169,000 to Eastgate Regional Council of Governments; $913,000 to NorTech (a nonprofit regional tech-based economic development organization); and $2 million to the Youngstown Business Incubator to construct the Taft Technology Center downtown.
"It's an agency that is able to navigate through gridlock," Williams said.
Chamber officials reported that the local economy's trajectory is on the upswing, illustrated by a host of economic development projects across the region.
"We've seen significant economic growth in 2013," said Sarah Boyarko, chamber vice president for economic development.
Last year, the chamber helped with 17 development projects that leveraged more than $574.7 million. These projects led to the creation of 399 jobs and new payroll of $12.8 million, she said.
Another 792 positions were retained along with $38.9 million in payroll, Boyarko said. And, new construction totaled 326,304 square feet while the chamber's business retention and expansion program conducted 1,160 one-on-one company visits in 2013.
Some of the higher profile projects are the opening of a 50,000-square-foot plant in Youngstown, the result of a joint venture between Youngstown-based Brilex Industries and Houston-based Valerus; a $20 million expansion of Ohio Star Forge in Champion; Legacy Measurement Solutions' decision to occupy a 73,000-square-foot plant in Brookfield as part of its manufacturing expansion; and Industrial Piping Specialists Inc.'s $10 million warehouse operation in Struthers.
There's little evidence this economic growth will be disrupted anytime soon because of international markets, observed Jeff Wagner, senior vice president and chief investment officer at First National Bank, which sponsored Thursday's breakfast.
"There aren't any significant land mines that should impact us," he told business leaders in the audience.
Although China's economic growth has stalled as that country begins to deal with the pressures of heavy debt, Wagner noted that it's likely the government would step in to temper any anxiety in the market. He projected growth in that country to be about 7.5% this year, down from 9.3% in 2011.
Also, many of the uncertainties facing the economies of southern European countries in the European Union “have already been baked into” the market, leaving little more for investors to digest. "Most of these problems are already known," he said.
The biggest challenge facing the United States is how the Federal Reserve Board of Governors will reduce its stimulus spending without causing a spike in interest rates, Wagner added. "It's a juggling act," he said, noting that Fed could reinstate its stimulus program should interest rates climb and markets falter.
Moreover, the Mahoning Valley has become a major component in a "super region" devoted to oil and gas production since drilling began in earnest in eastern Ohio's Utica shale.
Major pipeline infrastructure and construction projects related to shale exploration stretch from Mahoning County south to Harrison County, he noted. What's important is that these projects are drawing workers from throughout the region, including the Mahoning Valley.
He pointed to a new hotel under construction in Cadiz, in Harrison County, 150 miles south of the Mahoning Valley. "The contractor on that project is from Girard," he said.
Copyright 2014 The Business Journal, Youngstown, Ohio.
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