Mixed review: Toledo ranks in top 10 for goods sent abroad

<img src=http://www.toledoblade.com/assets/jpg/TO66067417.JPG> <b><font color=red>VIEW:</b></font color=red> <a href="/assets/pdf/TO73050726.PDF" target="_blank "><b>Snapshot of local exports</b></a> July 26, 2010 Enlarge

Toledo ranks among the top 10 metro areas nationwide in the share of its locally made products and services sent abroad, according to a report released Monday.

The report by the Brookings Institution on exporting in the nation's 100 largest metro areas also ranks Toledo in the bottom quarter of the cities when it comes to export growth, average wage in its leading export industry, and the percentage of local goods getting to the world's fastest-growing economies.

"This means Toledo has some strengths it can build on in terms of understanding its place in the global economy," said Jennifer Bradley, one of the authors of the report and a senior associate and co-director of Brookings' Great Lakes Economic Initiative.

Metro Toledo, she said, "understands that exports are important, but when you look at the low growth of exports in Toledo, [it shows] that what it has to do is figure out what Toledo can make that the world wants to buy."

The report, called "Export Nation: How U.S. Metros Lead National Export Growth," says 15.8 percent of the four-county Toledo area's gross metropolitan product that is sent to other nations is eighth highest among large cities in the United States.

The gross metropolitan product, similar to national gross domestic product, is the value of products and services produced locally.

The region's $4.28 billion value of annual exports of goods and services ranks 60th nationwide, and the 34,597 local jobs supplying those exports rank 58th. The rankings are based on data from 2008, according to Brookings.

The importance of exports has been a cornerstone of economic theory for generations because exports encourage greater economic competition and allow companies to spread their costs across a broader market, increasing profitability. Exports also can blunt the impact of domestic recessions and downturns by bringing in cash from other countries.

The national gross domestic product - about 80 percent of which comes from metro areas, Brookings says - grew 2.9 percent between the first quarter of 2009 and the first quarter of 2010, while exports grew at 15.7 percent, according to the U.S. Bureau of Economic Analysis.

Representatives from Brookings are scheduled Tuesday to present their nationwide report in Washington to show the role exports play in stimulating the economy. The representatives then will talk about policy recommendations for increasing exports.

In the report, metro Toledo gets relatively high marks for the diversification of the products and services it exports. Brookings identified 10 "industry clusters" locally that send products outside the United States, ranking the region 18th nationally. The national average among the 100 largest cities was fewer than eight clusters.

Some clusters noted for the Toledo area, such as "transportation equipment manufacturing" and "petroleum and coal products manufacturing" are as obvious as a right-hand drive Toledo-built Jeep Liberty or Dodge Nitro or the flare from the Sunoco refinery in East Toledo. Others, like "printing" and "electrical equipment manufacturing" aren't quite so out in the open.

In fact, transportation equipment manufacturing accounts for one in every three export-related jobs locally, Brookings said.

The diversified export base is desirable, Ms. Bradley argued, but it can also leave the region susceptible to global market changes, such as those that have occurred in the two years since the data were measured.

"The question Toledo needs to ask itself relentlessly is 'Are these clusters continuing to be competitive?''' she said. The data show the region may be stable economically, but needs to grow to keep up, she added.

"Stable is always better than declining, but stable means eventually you fall behind, if everyone else is racing forward," she said.

Toledo-Lucas County Port Authority President Paul Toth said exports become a key indicator as companies - especially manufacturing companies - seek to locate their businesses.

"We've always touted that we're in a great location," Mr. Toth said. "The products that are exported are really manufactured products, and manufacturing is what we do best."

Steve Weathers, chief executive officer of the Regional Growth Partnership, said the Brookings report was helpful from a business recruitment standpoint, because it shows a complex and diversified local economy.

"With the downturn in the economy, and all the things that have gone on, if you handicap it, we're probably doing pretty well," he said. "This shows that there's probably a lot more diversity in our local economy than what many people usually think."

Mr. Weathers said the 2008 figures, which largely predate the collapse of the national economy, also don't show the ensuing growth of the alternative energy sector in the local economy which helped blunt the collapse of the auto industry.

"There's nothing you can do to avoid global hits. But you want to be the producer of products that are in demand across the globe," he said. "We're doing that now with the solar industry, but we weren't doing that 20 years ago."

Contact Larry P. Vellequette at:

lvellequette@theblade.com

or 419-724-6091.