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Elkhart County’s ‘Stress’ Score Better in March

May 5, 2011 by · Leave a Comment 

Dorinda Heiden-Guss

Dorinda Heiden-Guss, Elkhart County EDC director

Lower unemployment, bankruptcies and foreclosures in March reduced the nation’s economic stress to its lowest point this year, according to The Associated Press’ monthly analysis of conditions around the country.

More than 85% of the nation’s 3,141 counties and every state but two — Louisiana and South Dakota — enjoyed better conditions in March than in February, the AP’s Economic Stress Index showed.

In Elkhart County, hub of the RV industry, the stress index has improved.

The county’s economic development board is negotiating to land 11 projects from companies in Britain, China and Norway that want to expand in the United States, said Dorinda Heiden-Guss of Elkhart’s Economic Development Corp.

About 40% of workers are employed in manufacturing in Elkhart County, whose Stress score was 13.36 in March, down from 22.28 two years ago. The county’s notoriety as a casualty of the recession might have put it on the radar of the international companies now looking to open plants there. The greater availability of financing also helped.

“Banks loosened up,” said Heiden-Guss.

Meanwhile, manufacturing activity, a major driver of economic growth since the recession ended in June 2009, has helped ease hardship in the Great Lakes states and Indiana over the past 12 months — more than in any other region.

By contrast, Louisiana, Iowa and the Mountain states of Idaho and Montana have suffered the sharpest increases in stress, year over year.

The average county’s Stress score was 10.5 in March, the lowest level since December. It was 11 in February and 11.5 a year earlier.

Under a rough rule of thumb, a county is considered stressed when its score exceeds 11. Using that rule, less than one-third of the counties were stressed in March, down from nearly 40% in February.

Unemployment in March declined or was unchanged from February in every state but South Dakota and in nearly 90% of the counties. Bankruptcies dipped in 43 states and 70% of the counties. And foreclosures dropped in 44 states and in more than 70% of counties.

In March, economic strains eased the most in counties with heavy concentrations of workers in manufacturing, retail and temporary staffing jobs. By contrast, stress rose the most in counties with many workers in wholesale trade and mining.

The government reported last week that the overall economy’s growth slowed sharply to an annual rate of just 1.8% from January through March. That was down sharply from a 3.1% rate in the final three months of 2010.

Many economists think the slowdown will be temporary. Nariman Behravesh, chief economist at IHS Global Insight, thinks growth will rebound to nearly 3% in the current April-June quarter. He predicts it will strengthen further to around 3.5% in the second half of the year.

The unemployment rate, now 8.8%, will dip possibly as low as 8% by year’s end, Behravesh says. He says the economy should be able to withstand this year’s jump in gasoline prices.

“Gasoline prices at around $4 per gallon will be a headwind, but they would have to go quite a bit higher to derail things,” Behravesh said.

Among all the most economically precarious states, stress levels declined in March. Nevada was again the most stressed state, with a score of 20.67. Next were California (16.19), Florida (14.52), Michigan (14.23) and Arizona (14.23). Still, thanks to gains in tourism, stress has declined more sharply in Nevada and Florida than in any other states over the past six months.

North Dakota remained the economically strongest state with a score of 4.89. It was followed by Nebraska, (5.7), South Dakota (6.27), Vermont (6.51) and New Hampshire (6.85).


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A City’s Mixed Feelings About Obama Impact

February 3, 2010 by · Leave a Comment 

Editor’s Note: Mike Stuckey, senior editor for MSNBC.com’s Elkhart Project, in this story updates readers a year after President Obama visited Elkhart, Ind., to lobby for his economic stimulus package. To see the entire package, click here.

President Obama addresses a crowd in Elkhart, Ind., in February 2009.

President Obama addresses a crowd in Elkhart, Ind., in February 2009.

One year after President Obama thrust Elkhart County, Ind., into the national spotlight by using it as the launching pad for his economic stimulus proposal, positive signs abound.

The region’s recreational vehicle industry, which was decimated by the recession, expects significant growth in coming years; businesses have announced nearly $400 million in new investments in the area; and the county has a fighting chance to become a leader in the electric vehicle industry.

But many locals are still watching warily for the only bottom line that really matters to them: new jobs.

Among them is Jeffery Ricks, 47, who last held down a full-time position as a welder at Godfrey Marine, an Elkhart manufacturer of small pleasure and fishing boats, more than two years ago.

“You know it’s going to be OK,” he said with a smile, “but the thing is, when?”

It’s a question that bedevils policymakers and pundits alike: When will the economy, which many indicators suggest is emerging from a deep recession, start producing new jobs?

At the local level, in Elkhart, political leaders believe the answer is soon.

“By 2011, this county is just going to explode with jobs and people,” said County Commissioner Mike Yoder, who has been working to entice new businesses to the area.

Dorinda Heisen-Guss

Dorinda Heisen-Guss

“Everything is full throttle,” said Dorinda Heiden-Guss, president of the Elkhart County Economic Development Corp., ticking off bullet points of hope for the county’s thousands of jobless workers.

The recreational vehicle industry, around which much of this region’s economy revolves and often seen as a bellwether for the nation’s fiscal health, appears to be recovering as many manufacturers rehire laid-off workers. A study done for Heiden-Guss’ group predicts 22%-plus annual growth for the next four years after a 74% decline in shipments since late 2005.

In 2009, businesses announced plans to spend $134 million to locate or expand operations in Elkhart County, creating a predicted 3,300 jobs.

Early this year, Norwegian company Think said it would spend $56 million setting up a plant to assemble electric cars, hiring 415 workers by 2013; and a new company known as Family Holiday Village Elkhart said it would build a $205 million European-style family resort that will create 500 construction jobs, 500 permanent jobs and draw a million tourists a year to the county within a few years.

It’s a big change from when Obama visited the city early in his presidency to pitch the economic stimulus plan. In his speech, Obama cited that fact that Elkhart’s jobless rate had tripled over the previous 12 months to more than 15%.

“We’ve got the best workers right here in Elkhart, who are willing to put in hard time and do whatever it takes to make sure a company succeeds, but they’ve got to have a chance,” the president said on Feb. 9, 2009, to hearty applause from his audience at Concord High School.

Not long after Obama’s trip, Congress passed a $787 billion stimulus plan. One year later, Elkhart’s jobless rate has fallen to 14.8% after hitting a high of 18.9%. The falling rate is due to some workers being rehired or finding new jobs but also due to some simply giving up, but it is still about triple what it was in boom times. Nationally, the unemployment rate is 10%, a stubbornly high number that has forced Obama to propose new incentives for companies to increase hiring.

Elkhart County Commissioner Mike Yoder sees lots of new economic activity in the county, but he admits it may be a while before new jobs show up in large numbers. Elkhart’s Yoder believes it’s going to take time for people to see a difference in their individual working lives.

“There is still a lot of cynicism out there, and I sense this as we announce the incentives to pull these businesses in,” Yoder said. “People are saying, ‘That’s great but I still don’t have a job.’ It’s unfortunate that it’s going to take a while for these jobs to show up. That’s just the way it is.”

And “just the way it is” includes plenty of cold facts to temper warm visions of the future:

Despite Elkhart’s falling jobless rate, an estimated 14,000 local workers remain unemployed. IHS Global Insight, a consulting firm, forecasts Elkhart won’t return to pre-recession employment levels until 2039.

The median price of a home in the county has plummeted to late 1990s levels, below $90,000, and continues to fall. Sales in 2009 were down by 35% from 2006.

As jobless residents exhaust savings and unemployment benefits, social service agencies are facing more requests than ever for help. One, Church Community Services’ food pantry in downtown Elkhart, served a record 2,169 households in December, more than 24,000 for the year, a 21% increase from 2008.

Area residents are split on the impact of the president’s stimulus package and his visits — he made two as a candidate and two as president.

Elkhart Mayor Dick Moore

Elkhart Mayor Dick Moore

Elkhart Mayor Dick Moore believes the county’s share of the $787 billion in spending and tax cuts has generated thousands of jobs locally, both directly and indirectly. But an msnbc.com tally could only find a few dozen new jobs directly created by the $50 million in stimulus money that has poured into the county, much of it grants that school districts would have received anyway.

Elkhart artist Shana Dines, who attended two of Obama’s local speeches, sitting right behind him and shaking his hand at one appearance, said her family’s finances had been “in disastrous circumstances” as a result of her husband’s hours at an RV supply firm being cut.

Now, “things have picked up unbelievably,” Dines said. “They’re working overtime and last year at this time they were down to four days a week.” As a result, the family was able to get a mortgage modification and hang onto its home.

“I’m not sure how much of that was Obama, but because of where he’s come from, he knows what it’s like to struggle and he wants to see the common people survive,” she said.

Graphic designer Justin Graber has seen business improve at the Elkhart ad agency where he works, but he believes that Obama’s attention to the county likely had as much of a negative effect as a positive one.

“I honestly think if the government would just get out of the way and let us go back to work, it would be better,” said Graber, a founding board member of the Michiana 9-12 Project, a group inspired by conservative TV and radio host Glenn Beck that stresses family and religious values over government solutions.

“I know it’s well-intentioned, but the ups and downs of the economy are just as emotionally driven as they are by business factors, and I think people pull back even more when they worry about where this (stimulus) money will come from,” he said.

Angie Recchio, a sales rep with an Elkhart decal maker that serves the RV industry and also active in the 9-12 Project, agreed that the government should stand back.

“We’re certainly very grateful that things bottomed out and seem to be improving,” she said, “but I think the free market economy works and its cyclical and it would cycle on its own.”

Regardless of where folks stand politically, there’s an almost palpable sense of fatigue for having their community held up again and again as the poster child of recession. “Most people are optimistic,” Recchio said. “People are ready to stop talking about it and move on.”

Real estate agent Cory White agreed, even though as a specialist in distressed property sales, he does not believe the real estate market has hit bottom yet.

“I think we’re back on track,” he said. “I think the jobs are coming.” Locals are more focused on the positive now than the negative, he said. “Elkhart’s been known for being first in and first out of a recession. We’re on our way.”

Heiden-Guss, of the Economic Development Corp., said her organization was “grateful for the coverage, even though it was dire at many times. I will say the notoriety has kept us extremely busy, both good and bad. We’ve had a lot of interested parties migrating toward the money.”

But Yoder, the county commissioner, said the best prospects for growth and new jobs are with companies that were on the county’s radar screen long before the economy tanked.

“It’s not just because the president visited here,” he said, although “that didn’t hurt.” And, he acknowledged, “we are using elements of the stimulus package to help these companies along.”

Perhaps the most exciting prospect for the area’s future is the growing buzz that Elkhart County could become a hotbed of electric vehicle development and manufacturing. Joining Think locally in that niche are Navistar, which plans to produce electric delivery trucks, and Electric Motors Corp., which is developing hybrid pickup trucks.

Indiana Gov. Mitch Daniels has “identified Elkhart County as the new electric vehicle capital,” Heiden-Guss said.

And while it will take some time for those jobs to arrive, workers like Ricks, the unemployed welder, and his partner, Suncearay Shorter, are willing to wait it out.

“Nothing happens overnight,” said Ricks, who said she lost her job with insulation supplier M.A.P. two months ago.

“It’s hard,” Shorter said, “but we have patience.” Besides, she added, there’s more to life than jobs and money. The couple are expecting their first baby together in September.

“God is good,” said Ricks.

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Hoosier Governor Praises Dometic for Expansion

August 4, 2009 by · Leave a Comment 

Indiana Gov. Mitch Daniels (left) and Dometic President Doug Whyte

Indiana Gov. Mitch Daniels (left) and Dometic President Doug Whyte

Indiana Gov. Mitch Daniels today (Aug. 4) joined executives from Dometic LLC, an international manufacturer of recreational vehicle accessories, and praised the company’s plans to expand its manufacturing operations at two northern Indiana plants, creating more than 350 combined jobs by 2012.

The company, which makes accessories ranging from air conditioners to sanitation systems for the RV market, will invest a combined $10 million to increase production capacity at its Elkhart and LaGrange manufacturing operations. That includes more than $6.8 million to move its refrigerator manufacturing operations from Sweden to a 150,000-square-foot facility in Elkhart, creating 241 new jobs, and $3 million to move production from a plant in Mexico, which was lost to a fire in April, to Dometic’s LaGrange facility, where it will increase manufacturing capacity of retractable RV awnings, creating 116 new jobs.

“We’ve never had a doubt. RVs will be back. Elkhart will be back, and will resume its place as a major center of economic strength for our state,” said Daniels.

The company currently employs 60 workers at its Elkhart operations and plans to begin hiring assembly, welding, maintenance and management associates immediately as the facility is prepared for production launch later in the fall.

“Our growth is a direct result of our product quality and the dedication of our associates. This new RV refrigerator factory in Elkhart allows us to serve over 70% of our customers located within a 50-mile radius,” said Doug Whyte, president of Dometic.

The company will sponsor a jobs fair early next month and plans to begin production by early November, Whyte said.

Daniels made a point that the two expansions were examples of Indiana insourcing jobs from other countries, and that the two Hoosier communities were in competition with cities in China and Mexico.

“Don’t tell me we can’t compete efficiently with the world,” Daniels said.

Elkhart’s (and Indiana’s) central location with excellent transportation connections make both ideal places to do business, Daniels added. He called Elkhart “a great part of Indiana to do business” and added that though the county fell fast and hard, “all the elements are there” for a strong recovery.

Daniels was cautious in predicting when the economy will turn around, however. He does not expect the economy to “roar back,” but he sees signs of an upturn.

Including today’s announcement, projects announced for Elkhart County so far this year are expected to create more than 2,000 jobs. That includes Electric Motors Corp. (EMC), a manufacturer of electric power drive systems for heavy trucks, which will partner with RV manufacturer Gulf Stream Coach Inc. to invest more than $80 million to establish manufacturing operations in nearby Wakarusa. The partnership holds the potential to create more than 1,600 new jobs.

EMC CEO Will Cashen was present for today’s press conference and drew praise from Daniels, who called his EMC plans “fantastic” news for the community. 

Dometic, which was founded in 1958 as a division of Electrolux, now holds operations in 10 countries and employs more than 4,200 associates. In addition to refrigerators, the company manufactures retractable awnings, climate control systems and sanitation systems for the RV, automobile, heavy truck and marine markets.

Whyte said Dometic has made 35 acquisitions in the past 37 years and continues to look for other businesses to acquire to add value to its business.

“We are pleased that Dometic has selected Elkhart as the site for the relocation of its Swedish production facility. This announcement and the subsequent creation of up to 241 net new jobs to the area could not have come at a better time,” said Elkhart Mayor Dick Moore.

“While the job losses that we as a community have experienced over the past 16 months have had a negative impact on our local economy, I am confident that better times lay ahead. We are a resilient community which has both faced and overcome adversity in the past. By partnering with the state, the Economic Development Corp. of Elkhart County and the Greater Elkhart Chamber of Commerce, we will leverage this success and will work diligently to bring additional positive economic development news to the community,” Moore said.

Moore said the Dometic announcement was an example of the “great news to tell” President Obama who is scheduled to visit nearby Wakarusa, Ind., on Wednesday and announce major economic assistance for the county.

The Indiana Economic Development Corp. (IEDC) offered Dometic LLC up to $1.1 million in performance-based tax credits and up to $320,000 in training grants across the two projects based on the company’s job creation plans. The Elkhart City Council late Monday approved additional property tax abatement for the project at the request of the Elkhart County Economic Development Corp. The town of LaGrange will consider additional property tax abatement.

“Dometic has been a great partner in the LaGrange community and we’re excited that they have chosen our county as the appropriate place to grow their operations,” said Keith Gillenwater, executive director of the LaGrange County Economic Development Corp. “We look forward to working with Dometic as they grow.”

The IEDC has at least four other deals on the table for new business ventures coming to Elkhart County, David Behr, senior project manager for the IEDC’s North Central Region, told RVBusiness.

Dometic Group is a customer driven, world-leading provider of leisure products for the caravan, motorhome, automotive, truck and marine markets. Dometic supplies the industry and aftermarket with a complete range of air conditioners, refrigerators, awnings, cookers, sanitation systems, lighting, mobile power equipments, comfort – and safety solutions, windows, doors and other equipment.

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