Toledo and manufacturing form a productive partnership, which continues to support good lives for tens of thousands of area workers and their families.
But while manufacturing will always be essential to northwest Ohio's job base, a new report suggests that our Rust Belt community risks getting left behind if we fail to develop a more advanced and diversified manufacturing economy.
The study by the Brookings Institution, released last week at a forum on globalization at Ohio State University, groups American manufacturing into six clusters; Toledo's specialty, as you'd expect, is transportation equipment. The study concludes that the flight of manufacturing jobs to Southern states is over, and that the Midwest leads the country in gaining such jobs.
Amid all the change and upheaval in the world economy, Toledo is still very much a factory town. One of every eight jobs in our metropolitan area is in manufacturing — the 10th highest rate among the 100 largest U.S. metro areas. Nationwide, manufacturing accounts for one job in every 12.
Despite the cutbacks by automakers during the Great Recession, cars and trucks remain Toledo's biggest manufacturing industry. One of every five manufacturing jobs in our area is tied to making motor vehicles or auto parts.
Manufacturing still pays well: In 2010, the typical manufacturing worker in Toledo made $63,000 a year — the highest wage rate among Ohio's major metropolitan areas. That compares to an average of $41,000 a year for all workers in our area.
And as the local economy slowly recovers, we're gaining manufacturing jobs. From the start of 2010 to the end of last year, the number of manufacturing jobs in Toledo rose by 7.1 percent — the 15th highest rate in the nation.
That's good news for our region. But other findings in the report are more disquieting.
Between 2000 and 2010, Toledo lost two-fifths of its manufacturing jobs, one of the worst falloffs in the country (Detroit lost half). Even so, relative to the rest of the United States, our area relies more on manufacturing to supply jobs today than it did 30 years ago.
Regional leaders have made strenuous efforts to diversify Toledo's economy in recent years, emphasizing growth in such industries as solar and wind power. They seek to place our area at the head of what they call the "new manufacturing economy."
Yet the Brookings report notes that Toledo is only in the middle of the pack among American communities in its share of "moderately high-tech" manufacturing jobs. Such work pays better — locally, $10,000 more a year than the typical manufacturing job — but demands higher-level and more specialized skills.
And we're near the bottom in our percentage of "very high-tech" jobs, held mostly by scientists and engineers. If you have such a job in Toledo, you earn $95,000 a year on average, among the best wages anywhere. But fewer than one in 20 local manufacturing jobs falls into that category.
We know that even though General Motors and Chrysler have bounced back robustly from their bankruptcies, the U.S. auto industry won't ever again support as many jobs as it once did, in Toledo or anywhere else. And what auto jobs there are won't offer the same high pay, benefits, and security.
We also know that high technology isn't the future of the American economy; it's now. So what can Toledo do to ensure that it gets ahead of the curve on manufacturing trends?
Economist Howard Wial, a co-author of the Brookings report, has suggestions for Toledo's corporate, labor, political, and civic leaders. Rather than try to reinvent the area's manufacturing landscape, he says, they need to find ways to apply the innovative techniques Toledo manufacturers already have developed to other industries, such as medical devices.
"You need to understand what your manufacturing base is — what's working well, what isn't," he told me. "For too long, in much of the Midwest, many people in economic development policy spent a lot of time wishing that their local economies were something else. It's better to have a hardheaded sense of what you're good at."
To take what the report calls "the high road," Mr. Wial says Toledo must do more to use its manufacturing assets and logistical advantages to promote trade and export opportunities and to attract global investment. Exports accounted for nearly half of the growth in American's gross domestic product in the past two years, he notes.
"Exports go hand in hand with the revival of manufacturing," he says. "Virtually all manufacturing is tradeable."
Ohio ranks third among states in its number of manufacturing jobs. But Mr. Wial cautions Ohio and Toledo to stay off "the low road" — a strategy of throwing around tax breaks like party favors to attract businesses, while seeking to slash wages. He calls a proposal to make Ohio a right-to-work state an example of low-road thinking.
The report notes that northeast Ohio — including the Cleveland, Akron, and Youngstown areas — has introduced a program to help manufacturers adopt new methods, develop products, and reach new markets. Toledo could learn from that.
Communities, metropolitan areas, and states can't do it all themselves. The Brookings report calls for a new national economic policy that plays to the strengths of regional industry clusters and encourages advanced manufacturing. That includes investments in high-tech job training, infrastructure, and research and development.
But waiting for Washington to do anything is an increasingly futile endeavor. So the effort needs to start here.
"You're not bleeding manufacturing jobs anymore," Mr. Wial says of Toledo. "You're gaining them at three times the national rate. How do you build on that success? That's the question you need to answer."
David Kushma is editor of The Blade.
Contact him at: email@example.com