Ohio's Rust Belt struggles with loss of manufacturing

TOLEDO, Ohio -- The pudding cups are gone.

So are the hot dogs, and bumper covers, and spark plugs.

Even the toilets in Tiffin have been flushed away.

Northwest Ohio and southeast Michigan have lost nearly 5,300 manufacturing jobs in less than two years, according to state and federal unemployment filings. And another 2,100 high-paying manufacturing jobs in the region are scheduled to disappear from the Toledo-area's economic map in the next several months.

Politicians rail against the loss of high-paying manufacturing jobs -- especially in their own constituencies -- but then say they are powerless to fight the global economy, or openly support policies that contributed to the job losses.

The latest large-scale casualty -- Norwalk Furniture Corp. in Huron County -- stunned its more than 500 employees with an immediate layoff notice on July 18 when its bank, Comerica of Dallas, abruptly cut off its credit.

Since 1995, when the North American Free Trade Agreement took effect, Ohio has almost continuously shed manufacturing jobs, while losing ground overall to other states and regions.

American Standard announced in December it would close its toilet bowl factory in Tiffin. The plant closed in January.

Consider:

-- Over the past five years, Ohio, Michigan, and Indiana posted the three lowest growth rates in gross domestic product among all states, according to the Northeast Midwest Institute.

-- In 1990, Ohio had an average of 1,059,520 people employed in manufacturing, according to the U.S. Bureau of Labor Statistics. As of May, 2008, there were 762,200 persons working in manufacturing -- a loss of almost 300,000 good-paying jobs after years of steady decline.

With America's economy in trouble, and potentially in recession, industries are facing a double whammy: consumers who can't afford to spend like they could two years ago and intense competition from foreign manufacturers offering low-cost products.

Democrats and Republicans battling for control of the White House and Congress have staked out markedly different positions on why manufacturing is struggling - and how to resolve it.

-- An uneven playing field

Rep. Marcy Kaptur, D-Ohio, said manufacturers in the United States are forced to compete on an uneven playing field in the world market.

"Essentially, American firms and the American people are being asked to compete against communist economies, managed economies, closed economies, and these create unbearable hardships," Kaptur said.

She said other countries subsidize the health and pension costs shouldered by corporations here, adding thousands of dollars to a car's price, for example.

-- Regulation, energy costs

Rep. Bob Latta, R-Ohio, sees the problem not so much as international competition but as government regulations and costly energy prices driving up the cost of doing business.

"We have a very expensive area for electricity and natural gas," Latta said. He also noted that labor costs are higher here than in southern states.

-- Federal policies

Norwalk resident George Mays, Latta's Democratic opponent in the November election, last week said federal policies are hurting Ohio and Michigan.

"The policies of giving tax credits to big corporations to do their manufacturing in other countries -- countries that dump their cheap products on our market, countries that don't respect the environment -- is just not right," Mays said.

-- A variety of factors

Last week, Sen. George Voinovich, R- Ohio, signed on to a Democratic-sponsored bill to beef up enforcement against thefts by international competitors of American business' "intellectual property."

In a prepared statement, Mr. Voinovich told The Blade that a variety of factors are to blame for Ohio's job woes, including unfair trade practices from China -- "accompanied by the lack of activity by our government to require the Chinese to fix these problems." Other factors, he said, are health and energy costs, and "a broken tax code."

-- 'Wrong-headed' trade deals

Sen. Sherrod Brown ,D- Ohio, decried what he called "wrong-headed trade agreements" that "have shipped Ohio jobs overseas, deflated wages, and hurt communities. We want trade, and more of it."

No local work force has been pounded harder over the last two years than those who work in the automotive industry, which has lost thousands of jobs as sales in North America dried up.

Few autoworkers, either those at assembly plants or those making parts, have escaped the economic pressures of the declining industry. In the last two years, nearly 75 percent of the manufacturing jobs that have left the Toledo area have come from the automotive sector.

"The decline in manufacturing is a global phenomena, it's not just a U.S. phenomena," said Dave Huether, an economist with the National Association of Manufacturers.

"Even the number of people employed in manufacturing in China has declined in the last 14 years by 16 million people. It's happening everywhere, Germany, Japan, Italy, everywhere they make things."

Contact Tom Troy at:tomtroy@theblade.comor 419-724-6058.

(Distributed by Scripps Howard News Service, www.scrippsnews.com.)