Statewide manufacturing jobs declining, officials remain optimistic

By Keith Gushard

09/03/07 — Though the economy at the local, state and national levels continues to shed manufacturing jobs, area tooling and machining representatives remain optimistic about the industry’s future.

“Our membership is fairly diverse,” said Scott Hanaway, president of the northwestern Pennsylvania chapter of the National Tooling and Machin-ing Association, a trade group for the industry. “It depends on the types of end-products made. Some are growing pretty strong right now.”

Shops that have survived have done it by investing in new technologies that allow for increases in productivity with fewer workers, Hanaway said.

Most of the county’s manufacturing jobs are in the tooling and machining industry, supplying equipment and parts to major manufacturers.

Manufacturing is important to Crawford County since there is a heavier reliance on it here than in other parts of Pennsylvania and the country. About 20 percent of the jobs in the county are related to manufacturing, compared to 12 percent for the state and 11 percent nationally.

However, statistics show manufacturing jobs continuing to fall across the board.

Crawford County had 7,700 manufacturing jobs in July 2007, according to the Pennsylvania Department of Labor and Industry. That’s down some 300 from the 8,000 recorded in July 2006.

Pennsylvania had 660,900 manufacturing jobs in July 2007 — down 12,800 from July 2006, according to the state’s Department of Labor and Industry.

Nationally, there were 14,054,000 manufacturing jobs in July, down 175,000 from the 14,299,000 in July 2006, according to the U.S. Bureau of Labor Statistics.

Despite all the losses, seasonally adjust unemployment rates locally, at the state level and nationally remain below 5 percent — a jobless rate that economists say indicates full employment since there are always some workers in transition.

Crawford County’s seasonally adjusted unemployment rate was 4.8 percent for July while Pennsylvania’s rate was 4.3 percent and it was 4.6 percent for the nation.

Scott Meckley, a state labor analyst, said last week the decline in manufacturing jobs is just slowly continuing.

“We’re not showing gains in manufacturing across the state,” he said. “There are productivity increases and technology increases, but (it is done) with fewer employees.”

Hanaway said there is business for area tooling and machining firms, citing those tooling firms supplying parts to the aerospace, mining equipment, agriculture equipment and oil field service industries as doing well.

“There is business out there,” Hanaway said. “We’re also seeing business coming back (from U.S. firms that sent work to China).”

“There are have been communication barriers,” Hanaway said of the reasons U.S. firms were returning work to American tooling firms. “There were problems with delivery — it may take weeks to get a product; quality problems where a part or mold wouldn’t perform.”

Larry Sippy, president of Sipco Molding Technologies of Meadville, said work at his shop is split.

“Building injection molds (for plastic parts) is tough, but precision machining is good” he said.

The molds are used in the automotive and consumer products industries while the precision machining is for the aerospace and heavy equipment industries, he said.

“It looks good through the end of the year,” Sippy said.

Brian Deane, president of NuTec Tooling Systems of Meadville, a maker of automated equipment for larger manufacturers, said his firm is doing well.

“Companies are continuing to invest money in their operations,” Deane said. “Their capital budgets aren’t being slashed.”

Deane expects business to continue at a steady pace into 2008.

The economy does remain positive overall, said Ralph Pontillo, president of the Manufacturer’s Association of Northwest Pennsylvania, a trade group that represents about 5,000 companies in 17 counties.

“Unemployment is low and we still have a solid manufacturing base,” said Pontillo.

Still, Pontillo is concerned about the economic future of the country, state and region — particularly as China continues to flex its economic muscle and conflicts with the U.S. on trade issues.

“We can measure the economy today, but what about four, five or 10 years out?,” he said. “Right now, we (the U.S.) are the dominant manufacturer in the world. If China becomes the dominant manufacturer in the world we may not be able to deal it then. We need to deal with it now.”