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August 24th, 2011
August 24th, 2011
The Changing Gears team is getting ready to take a look at manufacturing in September. And, there are some eye opening numbers about manufacturing, the auto industry and our region in a new report from the Federal Reserve.
According to Paul Traub, senior economist for the Chicago Fed’s office in Detroit, auto industry employment in the Fed’s 7th district — Michigan, Indiana, Illinois, Iowa and Wisconsin — is now just below 204,000 people, or about 9.3 percent of manufacturing jobs here.
The district does not include Ohio, which is one of the nation’s biggest automotive and manufacturing states.
In 2000, auto industry employment in those states alone was 474,000, or about 14.4 percent of all manufacturing jobs here. That loss of 270,000 jobs represents a 57 percent decline in auto jobs over the past decade in those states.
“It’s quite dramatic,” Traub said. “The question is whether we’ll see some recovery.”
When it comes to overall manufacturing jobs, Traub sees a depressing historic picture. Over the past 20 years, the region — and the country — have seen manufacturing employment drop by about 35 percent. The nation lost 6 million manufacturing jobs; our region lost 1.1 million manufacturing jobs.
Although many people think Midwest manufacturing employment has been on the decline in the United States for decades, it actually peaked only 10 years ago. In 2000, manufacturing jobs in the Midwest made up 19.1 percent of all the manufacturing jobs nationwide. Now, manufacturing jobs in the region make up 18.6 percent of the manufacturing jobs held across the country.
So, is there any good news? Traub sees some in job growth. In the first six months of 2011, the states in the 7th district saw jobs grow at an annual pace of 0.9 percent — better than the national rate of 0.7 percent.
Michigan actually led these states with non-farm job growth of 1.9 percent over six months. That was followed by Iowa, with 1.3 percent growth; Wisconsin, with 1.1 percent; Illinois, up 0.5 percent and Indiana, which saw job growth decline by 0.4 percent.
But that job growth isn’t bringing the area anywhere close to its past levels. The economist notes that non-farm, payroll employment is about where it was in 1996. That compares with the nation, where non-farm employment is around 2004 levels.
Traub says he’s doing further analysis about automotive employment and its prospects for playing a role in the nation’s economy.
He’s looking at a number of factors, such as how many cars each household will have, and whether housing, which is a big factor driving auto sales, will bounce back. He’s also looking at whether environmental awareness and the growing use of public transportation will have an impact on auto sales.
August 24th, 2011
Chicago Mayor Rahm Emanuel marks his first 100 days in office this week. Tonight, he’ll be taking
part in The First 100, a forum put on by our partner station WBEZ. Changing Gears will be there and we’ll be paying close attention to what he says about the city’s economy.
Using Emanuel’s transition report, WBEZ’s staff analyzed the steps he’s taken on government, communities, growth and children. Here’s how he’s done on the steps that affect Chicago’s economy.
1) Cutting spending. In his first action as mayor, Emanuel signed an executive order cutting $75 million in city spending, a key promise of his campaign.
2) Performance benchmarks. As he vowed to do, the mayor has set out benchmarks for city services like garbage collection, construction, maintenance, repairs and and infrastructure services. Many are posted on a city Web site. But he has not posted performance benchmarks for refuse service, WBEZ said.
3) Target industries. The mayor promised to identify targeted industries that will be supported for development, which he has done. They include technology, tourism, manufacturing, financial services and advanced materials. Emanuel has been appearing with companies like JP Morgan Chase that announce investments in the city.
4) Pilot communities. The mayor promised to pick out communities within the city for special economic development attention. But WBEZ said there was “no evidence” that he has done so, apart from two weekend working sessions with the University of Chicago and Loyola University.
Read the entire report card and tell us whether you’re satisfied with the way Emanuel is doing his job. Is he a model for other mayors around our regioni?
Pete Bigelow · Midwest Memo: Big Three Eye Ohio, Indiana Snags Illinois Company, Toyota Banks On Revamped Camry
August 24th, 2011
Three stories making news across the Midwest today:
1. Chrysler invests in Toledo. Ohio Gov. John Kasich emerged from meetings with Big Three officials with a promise from Chrysler to invest $72 million in a Toledo-area machine plant that retains 640 jobs. That may just be the beginning. The auto companies see Ohio as fertile ground for future investments. “We’re very encouraged by the changes we see happening in Ohio,” GM executive director Bryan Roosa tells the Columbus Dispatch. “The attitude toward manufacturers is very supportive.”
2. Toyota unveils 2012 Camry. After two years of setbacks associated with a widespread recall and Japanese catastrophe, Toyota is banking on its 2012 Camry to reestablish itself as an industry leader. Unveiled Tuesday, the ’12 is its first redesign in five years and attempts to match competitors in styling. “It’s critical they get this right,” Michael Robinet, VP of global vehicle forecasts at HIS Automotive tells AOL Autos. “They are facing a deluge of competitors that are really getting it right.”
3. Indiana snags Illinois company. Modern Drop Forge, a manufacturer of vehicle parts, said Tuesday it will move operations from Illinois to Merrillville, Ind. The company, which employs 700 in four states, received incentives worth as much as $2.2 million from the Indiana Economic Development Corporation. Business owner Greg Heim told partner station WBEZ the cost of doing business in Illinois had crept too high, with the state raising its corporate income tax from 4.7 to 7 percent until 2015.