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Linking Workforce Development, Education & Economic Development In Armstrong, Butler & Indiana Counties

Advanced Manufacturing

Western PA has long been considered the heart of manufacturing. The 2009 Pennsylvania Manufacturers Register reported that the commonwealth lost 10,684 manufacturing jobs (1.2%) between May 2007 and May 2008 in part due to automation, mergers and outsourcing. That drop is not as sharp as a year ago, when the report found the Keystone State lost 21,449 manufacturing jobs, or 2.3 percent of its employment between May 2006 and May 2007. While manufacturing is struggling across the state, it remains stable with slight growth (.8%) over the past year in the tri-county area. Current RDAT Data indicates that there are 192 local employers in manufacturing with 12,377 employees in 2008. Although there are 142 less manufacturers in the local area, there is actually an increase of 288 employees in manufacturing indicating that manufacturing is still crucial to the area. The Location Quotient (LQ) is 1.67 for all of manufacturing but even higher in more specific NAICS codes such as ferroalloy and related manufacturing with an LQ of 24.40, petrochemical manufacturing with an LQ of 11.80, tire manufacturing with an LQ of 15.21, and iron and steel mills with an LQ of 5.22. According to data from the Bureau of Labor Statistics, manufacturing is one of the largest industries in the country, with about 14.1 million jobs. It is predicted that between 2006 and 2016, manufacturing jobs will decrease 1.1 nationally. Within the tri-county area, manufacturing accounts for over 11.07% of the total number of individuals employed in the three counties. Manufacturing employers are among the top 50 employers in each of our three counties with production occupation wages averaging more than the county wage in two of the three counties.

According to the National Association of Manufacturers, manufacturing makes the highest contribution to economic growth of any sector and is responsible for 70% of private sector research and development. Manufacturing represents 12% of the country’s entire gross domestic product and every dollar in manufactured goods generates an additional $1.37 worth of additional economic activity. Overall, the industry pays wages and benefits that are about 25% higher than in non-manufacturing jobs. These facts all indicate the importance of manufacturing to the economy.

As of June 2009, Tri-County’s civilian labor force totaled 180,600, which includes 166,000 employed and 14,600 unemployed. While the civilian labor force grew by 2,600 since last year, the unemployment has gone up dramatically by 5,600 individuals. According to the PA Department of Labor’s Center for Workforce Information and Analysis, the total state population is expected to increase 1.3 percent between the years 2000 to 2010. Pennsylvania ranks second only to Florida in number of citizens age 65 and over, and the largest statewide increases are projected to occur in the 55-59 and 60-64 age groups. Conversely, the number of Pennsylvanians aged 30-44 is expected to decline. The Bureau of Labor Statistics indicated that between 1977 and 2007, employment of workers 65 and over increased 101 percent, compared to a much smaller increase of 59 percent for total employment (16 and over). According to the U.S. Census Bureau report, “The Geographic Distribution and Characteristics of Older Workers in Pennsylvania,” of the workers in the state 55 and older, 16.7% were employed in Manufacturing, the highest proportion for that age group of any industry sector in the state. With fewer workers in this prime working age group and with a large number of expected retirements, the focus will be on preventing a labor shortage in the future and retaining experienced employees. It is thought that by 2018, labor force entrants from following generations may be insufficient to replace workers as they retire. Since 2002, the civilian labor force has grown approximately 5%. This is because Butler County is experiencing growth well above the state level (14.5%), due primarily to migration from Allegheny County to the Cranberry Township area. Although the manufacturing industry has been suffering in the economic downturn, a survey conducted by TCWIB in June 2009 indicated that manufacturing is the largest industry expecting to hire once the economy recovers. Data show that equipment operation, CAD/CAM skills, and welding will be needed in the future. This data indicates the continued need to address manufacturing workforce development needs in the tri-county area. Therefore, local employers believe it is crucial to continue the work of the local industry partnership with a specific focus on pipeline development, recruitment and skill development strategies.

The Tri-County Manufacturing Consortium has worked to promote manufacturing within the community as well as increasing the skills of incumbent workers. Key accomplishments include the following.

• Regional training opportunities for members in all three counties
• Supported outreach to youth and adults to promote manufacturing careers
• Supported Educator in the Workplace
• Participated in ARMTech, a regional event for Industry and Technology
• Reached over 1700 youth through career fairs, camp workshops, and other activities
• Held Radio Shows promoting manufacturing that reached over 30,000 households
• Produced the Tri-County Manufacturing DVD that reached at least 80,000 households in 5 counties on cable TV
• Promoted manufacturing with over 2,000 thirty second TV commercial spots
• Completion of S.E.T. (Skill Expansion Training) Curriculum
• Heavily involved with Workforce Forums connecting Education (K-12) and Business in the Tri-County area.
• Participants from all counties in Females in Technology and STEM Initiatives.
• Sponsored various summer camps for youth to promote Manufacturing such as Gadgets and Gizmos and Kids on Campus – Technology and Electro-Optics.

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