Don Cunningham discussed the “The Year in Lehigh Valley Economic Development” at the 2017 LVEDC Annual Meeting at the ArtsQuest Center in Bethlehem.

Don Cunningham, President and CEO of the Lehigh Valley Economic Development Corporation (LVEDC), delivered a speech about “The Year in Lehigh Valley Economic Development” during the 2017 LVEDC Annual Meeting, held March 23 at the ArtsQuest Center in Bethlehem. Below are his remarks.

I hate it when a plant closes. I’m sure we all do. But, other than those that lose a job, I have reason to dislike it more than most. If the story is big enough in the local media – like the Kraft-Heinz merger of the last year, which closed the Kraft plant – the national media starts calling, salivating on a pre-conceived story line of rust belt demise.

When I tell them that we are Pennsylvania’s fastest growing region, the state’s third-largest population center, have a workforce of about 350,000 workers, of which 92,000 come in every day from neighboring counties to meet the demand — particularly in an industrial sector that’s at full employment — I hear the excitement exit their voice. Stereotype busted. The Billy Joel song was recorded in 1982. Try giving Ohio a call.

While the loss of any job causes us to feel for that worker and that family, the reality is that today many more are being created than lost.  Opportunity abounds. Today, 400 jobs shed over an 18-month period doesn’t show up in the rounding. It just gets a lot of press. The biggest challenge right now, particularly in the industrial and manufacturing sectors, is the supply of workforce with the right talent and skills.

I’ve handled those calls since my days here as mayor when Bethlehem Steel closed in 1998 during my third month in office. Back then there was some truth to the stereotype. Today, quite frankly, 19 years later, those calls just tick me off.

It takes a lot of work when your facts are getting in the way of someone’s assigned story. But, there is opportunity in challenge. Most of the time we beat back those storylines with facts, data and rankings. We often turn them into positive pieces on economic change. This year, we’ve gotten The Guardian, Reuters, CNN, Money magazine, U.S. News and World Report, and the Philadelphia Business Journal to tell the Lehigh Valley’s new economic story.

Last week’s release of Site Selection magazine’s annual 50 state development ranking should help. Every year Site Selection – the leading magazine of those siting projects, like location consultants and industrial and commercial real estate brokers – puts out a ranking of states and regions on projects. It’s not a subjective report but straight data.

Here is where we now stand in the country.  The Lehigh Valley was the fifth metropolitan market for economic development projects in 2016 in the Northeast, the country’s largest market.

As you can see in their ranking slide, we come in right behind metropolitan areas that dwarf us in size: 1) the New York-Newark-Jersey City market, 2) the Philadelphia-Camden-Wilmington market, 3) Pittsburgh, and 4) Boston-Cambridge-Newton. Next on the list is Allentown-Bethlehem-Easton, the Lehigh Valley, with 26 projects that made the list for 2016. We actually had many more projects but they weren’t large enough to qualify for the Site Selection list.

Today, we will highlight some of those projects and give you a sense of how our Valley is growing. Rankings are good because they help to verify the messaging we drive every day in our recruitment and marketing work with site selectors, location consultants, brokers, company asset managers and trade media and national media reps. Some of us log a lot of air miles telling our story to very specific audiences, opinion shapers and influencers, and those making decisions on plant and company locations and relocations. It is working. We are now often invited to present on, “what in the world is going on in the Lehigh Valley.”

Two weeks ago I was in Toronto, along with the Rockefeller Group and Fitzpatrick, Lentz & Bubba talking to an international group of industrial and commercial brokers about how we landed the largest FedEx processing facility in the United States, which will be operational at the end of next summer. Last week I was in Tucson with the national Guild of Site Selectors, the Country’s leading group of national real estate consultants. We are one of the smallest markets at the table. Most of the others there are large markets, which is what I view as our competition. The Lehigh Valley punches well above its weight class. Our competition is larger than us and, frankly, spends more money than us.

Our seat at the table is made possible by all of you who support this regional effort, who believe in the economic and quality of life assets of the Lehigh Valley. Last year, we had our largest year of private sector investment since our founding. We surpassed $500,000 in financial support for the first time since before the hotel tax. This is critical. Many think the hotel tax provides what we need. It’s a great help, but it doesn’t. The $1.38 million it contributed last year gave us about half our budget. Anyone who has ever invested in national sales, marketing and advertising knows how far that will take you. We are fortunate that along with the private sector our counties see value in our work for them. Together, they contributed $155,000, our only contribution of Lehigh Valley tax dollars.

But, results are not just about quantity it’s about quality. Our recruitment is targeted in four areas: advanced manufacturing, bio and life sciences, professional office and food and beverage production. It’s a balanced strategy that aims to create new good-paying jobs in sustainable sectors that support the growth of our cities and takes advantage of our educational resources in vocational and technical education and engineering and other STEM skills.

We will highlight several successful projects in these areas tonight, and talk about our Education and Talent Supply effort, bringing the education and employment sectors together to work on issues of talent supply and demand. It’s critical that we link our employers to the availability of skilled workers and ensure that pipeline continues into perpetuity.

By now, you’ve probably read or heard some of the stats:

• The region’s industrial market grew by nearly 7 percent in 2016, for a total inventory of 113.6 million square-feet, becoming the most desirable market in the East Coast, growing faster than the inland empires in California and one of the centers of the e-commerce storm on the East Coast and in the nation.
• Our regional gross domestic product hit the $37 billion mark for the first time in our history.  That’s larger than 97 other countries in the world and the entire state of Vermont, whose GDP is just over $30 billion.
• For the third straight year, the Lehigh Valley had the best post-Recession job growth out of any other major metropolitan area in Pennsylvania. We have 3.5% more jobs today than we did before the Great Recession began, compared to a statewide average of 1.1%.
• Manufacturing is, once again, the region’s top economic sector, making up $5.6 billion – or 15 percent – of the Lehigh Valley’s overall GDP. This one is probably most important. It makes us unique in America.

Manufacturing looks different today than it did before, primarily because of automation and technology. Locations employ fewer people but there are more of them. There are about 680 manufacturers in our region employing about 32,000 workers, making everything from aeronautic components to building materials, from Mack Trucks to medical supplies and devices, from beer to baked goods.

We were in the Top 13% nationally for year-to-year manufacturing growth, and more than one-third of the Lehigh Valley’s economic growth from 2014 to 2015 was attributed to manufacturing.

This may all seem hard to believe, particularly following the rhetoric of a presidential election that focused on finding a way to return to America’s manufacturing past.  We know America’s manufacturing past. We lived it. Today, we are leading the way, as the Lehigh Valley is building America’s manufacturing future. And, our opportunities continue from within our borders and overseas. More than half of our prospects today are manufacturers.

To drive that message, we’ve adopted a new marketing campaign. You may have seen the billboards. We are busy telling our story and sending our message to those reporters and anyone that will look or listen. We are shouting it from the rooftops: “Hey, world, we still make stuff here!”