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LVEDC’s Statement on Kraft Heinz Manufacturing Plant Announcement

By Colin McEvoy on November 4, 2015

Below is the Lehigh Valley Economic Development Corporation‘s (LVEDC) regarding the recent announcement by Kraft Heinz about their Upper Macungie Township manufacturing plant:

We never like to hear that a plant is closing operations but this doesn’t come as a complete surprise.

It is a result of the Heinz acquisition and the unfortunate reality that comes with two companies merging into one. The closing is not because of a market trend or the regional economy. The Lehigh Valley economy continues to be strong, particularly in the food and beverage processing area, which is one of our largest and fastest growing sectors.

LVEDC worked with the Commonwealth on the expansion of Kraft in 2013, and we visited with them again last year, at which time production and employment were steady and solid. Following the completion of the Heinz acquisition this summer, we made repeated attempts to visit the facility again and to discuss any operational issues that could come with the new ownership but couldn’t secure a meeting. This caused us some concern regarding the plant’s future but we didn’t know anything until today.

From a regional perspective, we are very optimistic for both the workers and reuse of the plant. The 1 million square foot facility is in the prime food and beverage corridor with quick access to I-78, rail service and access to the pre-treatment plant, which is very desirable. The vacancy rate for industrial and commercial properties above 500,000 square feet is 3 percent, well below the national average. Job growth in the hourly production, logistics, distribution and e-commerce has been steady, and several large employers have been adding additional shifts and jobs.

While transition is never easy, a loss in this sector and this location is likely to be much easier than in other areas. LVEDC will work with the plant owner and local brokers to market the facility as quickly as the owner is willing to sell it. Employees will find help through the Workforce Investment Board and other entities in locating other opportunities within the Lehigh Valley.

Several nationally-recognized brands call the Lehigh Valley their home, including Ocean Spray, Nestle Waters, Ice River Springs, Coca-Cola, Niagara Waters, and Boston Beer. In fact, Lehigh County has more national beverage producers than any of Pennsylvania’s 67 counties.

As LVEDC announced last month, the Lehigh Valley’s gross domestic product has grown to $35.4 billion, surpassing the $35 billion mark for the first time and showing growth in every measurable sector. Our robust and multi-faceted economy continues to be strong and demand employment of trained and skilled workers.

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Lehigh ValleyQuick Facts

By the Numbers
$40.1 Billion

Gross Domestic Product

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City Center Lehigh Valley
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11% of Labor Force
Employed in Manufacturing

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$3.65 Billion

Exports

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Air Products
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$62,489

Median Household Income

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PPL Electric Utilities
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26,000

New Jobs Created Over Past 5 Years

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669,899

Population

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Olympus
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345,260

Labor Force

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Lutron Electronics
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26.1% of Labor Force
Employed in "Eds & Meds" sectors

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5,073

Technology Patents

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Mack Trucks
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UGI
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NFI
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14% of the total community college degrees awarded in PA

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$7.4 Billion

Manufacturing Contribution to GDP

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BB&T
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69th largest metropolitan area in the U.S. by population

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10,328 degrees awarded by colleges and universities

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81,000 employed in "Eds & Meds" sectors

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26.97%

Population between ages 18 and 34

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