Exporting has big role in Valley, expert says

The chamber’s job creation efforts led to 756 new jobs last year.

By DON SHILLING

VINDICATOR BUSINESS EDITOR

LIBERTY — Declining auto sales will deliver a punishing blow to Northeast Ohio this year, but the local economy should have a counterpunch of its own, an economist said.

Exporting should continue to be a strong part of the regional economy because the lower value of the dollar makes products made here cheaper, said Ned Hill, a professor at Cleveland State University.

“If you can’t export in this environment, you should get out of the game,” he said Wednesday at the Regional Chamber’s economic forecast breakfast at the Holiday Inn MetroPlex.

Ohio companies are in the game, however. Hill said Ohio companies export more than they import, making free trade agreements a boon for the Ohio economy.

Census figures show that Ohio was the nation’s eighth-largest exporting state in 2006. Its exports that year were valued at $37.8 billion, up 26 percent from 2002.

Hill noted that some manufacturing segments in the Mahoning and Shenango valleys are doing well, even though they aren’t adding jobs. Makers of primary metals, producers of transportation equipment and fabricators lead the local economy in producing value-adding products. But they are using productivity enhancements, not adding jobs, he said.

“The economy is growing value quicker than employment. That’s not a bad thing. The jobs will have to come next,” he said.

On the negative side, an expected slowdown in auto sales this year will hurt the local and statewide economies, Hill said.

The nation’s auto plants are capable of producing 18 million vehicles a year, but experts had forecast 2008 production of between 16 million and 16.25 million. Hill said those predictions have been revised to 15.5 million because of the weakening economy.

He expects sales to be even lower because of credit problems consumers are having. Sales should be about 15 million vehicles, he said.

“That will work its way through the Ohio economy,” he said.

Not only does Northeast Ohio have auto plants such as General Motors’ Lordstown complex, but it also has a large base of auto suppliers.

Overall, Hill said the economies in the Mahoning and Shenango valleys have performed well since 2003. The national recession of 2001 hit the valleys harder that the rest of the country because of their reliance on manufacturing, he said.

But starting in 2003, the growth rate of the local economy has been similar to national averages, he said.

“You’ve figured out how to sell yourself,” he said.

Reid Dulberger, executive vice president of the Regional Chamber, is a key figure in selling the Valley. He oversees the chamber’s economic development efforts.

He presented the chamber’s progress report for job attraction and creation in 2007. The chamber assisted 20 companies in projects that created 756 jobs and led to $16.5 million in new payroll and $63.1 million in investments.

Last year was the fourth year of the chamber’s five-year Pride in Progress campaign, and it’s apparent that most of the campaign’s economic development goals will not be reached.

For example, the campaign listed a goal of assisting 125 companies that would create 6,000 new jobs. So far, the chamber has helped 84 companies that have created 4,400 jobs.

Dulberger said the campaign hasn’t been a disappointment, however. The goals that were set were “stretch” goals that exceeded what the chamber had been able to do in two previous campaigns, he said.

“We feel good about our effort and the successes we’ve had,” he said.

He noted that the chamber worked with FedEx Ground last year on an $8.3 million expansion of its North Jackson warehouse. The project will add 30 jobs.

Plus, he pointed out that Infocision Management Corp., an Akron-based call center operator, announced plans to spend $10 million to expand in Boardman and Austintown. The projects will add 320 jobs, giving the company 1,300 employees in the region.

Although the five-year job creation campaign ends this year, Dulberger said discussions are ongoing about how to continue the effort.

The chamber’s supporters have indicated that they would rather commit money to a shorter-term project so they can gauge the results more quickly, he said.

Area foundations and companies donated $2.2 million for the current campaign. The chamber uses that money and other revenue to spend about $1 million a year on its economic development programs, including paying staff, buying land and other activities.

shilling@vindy.com