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Don Cunningham: ‘Hey, World, We Still Make Stuff Here!’

By Colin McEvoy on October 25, 2016

This column, written by LVEDC President and CEO Don Cunningham, originally appeared on The Morning Call website on October 25, 2016. (Click here to read Cunningham’s previous columns.)

Don Cunningham

Don Cunningham

Hey, world, we still make stuff here.

I want to shout that at my television screen each time I watch a presidential debate.

Manufacturing is the largest sector of economic output in the Lehigh Valley. It may be different than it was 25 years ago. It may be much more diverse and, yes, automation may have reduced the size of the workforce, but manufacturing is alive and well in the Lehigh Valley.

There are about 680 manufacturers in Lehigh and Northampton counties. They employ about 33,000 workers and generate $5.56 billion in economic output. The formal government term for economic output is Gross Domestic Product, or GDP.

Each fall, the U.S. Department of Commerce releases its annual report on Gross Domestic Product (GDP) in the United States. The report breaks down America’s GDP by metropolitan region and industry and business sectors.

In 2015, Lehigh Valley businesses topped out at $37 billion of GDP, a record-breaking year. That’s more GDP than the state of Vermont and 97 small nations in the world. Most significantly, however, manufacturing returned to leading the way in the Lehigh Valley for the first time since the days of Bethlehem Steel Corp., representing 15 percent of our total GDP. Warehouse and distribution ranked a mere sixth.

Amid the rhetoric of a presidential election often focused more on America’s past than its present, this may be hard to believe. But, the numbers are there for all to see, simply go to bea.gov.

How can that be? One very focused and innovative company at a time, representing a multitude of different industries with the common denominator of all making something.

Yes, gone are the days of massive manufacturers like Bethlehem Steel that employed thousands and thousands of workers. Today, the typical manufacturer employs anywhere from 20 to 75 workers, usually located in anywhere from 5,000 to 80,000-square-feet of space. Technology, machines and automation do a lot of the work that people once did but automation is also the key to vastly increasing productivity at American plants and keeping industries competitive with cheaper foreign labor.

That’s not going to change, just as the development of automobiles drove blacksmiths banging out horseshoes out of business. There is no magic wand to bring back the days of old.

But, all of our eggs are no more in one or two baskets like steel and textiles. Today, Lehigh Valley businesses make medical devices, food and beverages, machined parts, lighting controls, water coolers and ice dispensers, guitars, pharmaceuticals, pumps for aquariums and components for cell phones.

And, yes, we still make steel here – Lehigh Heavy Forge makes large specialty steel products on the former site of Bethlehem Steel — and every Mack Truck sold in North America is assembled right here. Contrary to popular assumption, heavy industrial manufacturing also is not gone. Victaulic is one of the leading makers of industrial pipe fittings the world, helping to drive development of the natural gas industry in Pennsylvania.

International manufacturers are also here. German-owned companies like B. Braun, which makes medical devices and pharmaceuticals; Hydac, producing industrial hydraulic products; and Bosch Rexroth making innovative machines that make things.

A few years ago, the Chinese company Fuling Plastics reversed the storyline of recent decades and brought its manufacturing to America, specifically Upper Macungie, where American workers now produce plastic products for the fast food industry and retail stores. There are dozens of additional examples.

Why the Lehigh Valley? Available land and buildings, great distribution access to the East Coast consumer market, a properly skilled and available workforce, a competitive cost structure, a good quality of life and governments, schools, businesses and organizations that work together to help make it happen.

It may not be your father or grandfather’s manufacturing, but it’s still here. So, next time someone tells you American doesn’t make anything anymore please join me in jumping on your sofa and yelling at the television, “Hey, world, we still make stuff here.”

Maybe if enough of us do it, someone will hear.

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Lehigh ValleyQuick Facts

  • Industry Spotlight

    14.2% of Labor Force
    Employed in Professional & Business Services
    Q4 2016

  • By the Numbers
    $37 Billion

    Gross Domestic Product

  • Investor Spotlight
    City Center Lehigh Valley
  • Industry Spotlight

    10.2% of Labor Force
    Employed in Manufacturing
    Q4 2016

  • By the Numbers
    $4.3 Billion

    Exports (2015)

  • Investor Spotlight
    Air Products
  • Industry Spotlight

    1325 Total Office Buildings

  • By the Numbers
    $58,134

    Median Household Income

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    PPL Electric Utilities
  • Industry Spotlight

    1707 Total Industrial Buildings

  • By the Numbers
    24,400

    New Jobs Created Over Past 5 Years

  • Investor Spotlight
    National Penn
  • Industry Spotlight

    4.8% Industrial
    Vacancy Rate

  • By the Numbers
    658,477

    Population

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    Olympus
  • Industry Spotlight

    8.8% Office
    Vacancy Rate

  • By the Numbers
    336,100

    Labor Force

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    Lutron Electronics
  • Industry Spotlight

    10% of Labor Force
    Employed in Leisure & Hospitality
    Q4 2016

  • By the Numbers
    4,359

    Technology Patents from 2000-2013

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    Mack Trucks
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    1.6% of Labor Force
    Employed in Food & Beverage Manufacturing
    Q4 2016

  • By the Numbers
    25 Million

    Office Inventory (Square Feet)

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    UGI
  • By the Numbers
    108 Million

    Industrial Inventory (Square Feet)

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    NFI