A year of uncertainty, fear & cautious optimism

Region – When it comes to the economy, 2010 begins much the same way as 2009 did, with uncertainty, fear and cautious optimism. Still clouds of deep recession linger and we all await signs of absolute recovery.  To say that there are a lot of concern about the immediate and long term futures of the national, state and local economies would be to severely understate the mood of the nation.

Today, we’ve even got to worry about the state of our global trade partners and competitors. When, and if, China suffers economic setbacks, we are sure to feel some of the impact. The dollar continues to struggle and carry less influence internationally.

In Pennsylvania, we saw the continuation of high unemployment, with the rate standing at 8.5 percent by year’s end, according to the U.S. Bureau of Labor Statistics.

The state continued to lose manufacturing job, with the rate of loss standing at 10.3 percent in November. Losses were also seen in construction (7 percent), transportation (2 percent), information (6.6 percent, financial services (5.4 percent), professional and business services (5.8 percent), and leisure and hospitality (2 percent.)

Gains were slight in the government and education sectors. The greatest growth, not surprisingly, was seen in the mining and logging sector (plus 5.7 percent) where the activities surrounding the Marcellus Shale play provided the promise of growth and prosperity, especially in central Pennsylvania. As the year came to an end however, there were signs that drilling for natural gas in the Marcellus Shale was going to be evaluated for its environmental impact. And Governor Rendell, who previously favored not taxing the industry, had changed his mind.

In the region served by Pennsylvania Business Central, the economy shadowed the state’s results.

The Altoona metro saw a decrease in its workforce, ending the year with a 7.3 percent unemployment rate. This was a slight improvement from the 7.5 percent rate seen in June.

Altoona metro’s manufacturing jobs shrunk by 6.8 percent in November with a 3.8 percent loss in leisure and hospitality jobs.

In Johnstown, the unemployment rate stood at 8.8 percent by year’s end. Loss of manufacturing jobs was slowing by November. The rate of loss had shrunk from a high of 12 percent in August to 8.3 percent in November. No industry sector showed growth.

In State College, where it is believed that Penn State buffers the economy from feeling a recession, the unemployment rose to 6.0 percent in the middle of the summer and stood at 5.7 percent in November.

Not surprisingly, the greatest loss of jobs was seen in manufacturing, while the greatest gain, though small, was seen in education and health services.

Williamsport’s unemployment rate stood at 8.9 percent in November, having improved from 9.2 percent in September. There was growth in government jobs and, of course, mining and logging. Williamsport is serving as the state’s hub of Marcellus Shale activity.

Despite the negative employment numbers, mass layoffs and tight investment credit, Pennsylvania Business Central was able to report on positive developments.

While layoffs were announced at Alcoa in Westmoreland County, due to freefalling commodity prices, other metal fabricators in the region made positive announcements. Kennametal completed its acquisition of Tricon Metals and Services. Kardex AG, based in Zurich, Switzerland, purchased the assets of Kardex Systems, its American competitor. This was believed to have saved 100 jobs in Mifflin County.

Pennsylvania’s 93^rd Annual Farm Show welcomed slightly fewer visitors, while celebrating agriculture, the state’s largest industry.

In January, the Pennsylvania Department of Transportation released a list of road project candidates, positioning the state to take quick advantage of any federal stimulus dollars that6 might be coming.

The Employee Free Choice Act, which dealt with an employee’s right to a secret vote in selecting to unionize or not, was very much in the news, with a majority of economic developers opposing the legislation.

In early February, we reported on the upheaval in the banking world, with many local banks unsure how the Troubled Assets Relief Program was going to impact their business.

The architecture industry – hit hard by the slowdown in construction – hunkered down in “survival mode” for 2009. Meanwhile, engineering firms were looking to land contracts funded by the federal stimulus package.

In Bedford County, Captive Aire, North America’s leading producer of commercial kitchen ventilation systems, opened a production facility with help from the state to the tune of  $2.9 million. The opening created 32 jobs for the region.

Toward the end of February, Williamsport/Lycoming Chamber of Commerce held its 123^rd annual meeting. Vincent Matteoi, president and CEO, urged his members to fight back against the negativity and stay positive about the future of the local economy.

On February17th, President Obama signed the $787 billion stimulus bill, with Pennsylvania receiving about $1.5 billion for infrastructure projects. The main concern, at the time, was how quickly the money would make an impact on job creation.

The promise of a thousand new jobs in Clearfield County was announced with the River Hill Power Plant project, which was expected to convert waste coal into clean energy.

The state’s first corn ethanol plant was progressing well in Clearfield, despite the recession.  Construction was expected to keep 100 jobs in place.

With the new administration in place in Washington, the defense contractors in the region were bracing for new expectations and fewer dollars. In many parts of the region, especially Cambria County, defense jobs are critical parts of the economy.

By the end of March it was clear that small business lending was much lower than expected, and seen as a potential roadblock to economic recovery.

Early April saw the announcement that Arcadia Properties, LLC, announced its plans to develop a 250-acre site in Lycoming County. The company planned two large warehouses and a flex building.

The increase in government spending led to the so-called Tea Party protests across the nation, including this region. The participants called for the reduction of government spending and resistance to the “arbitrary redistribution of wealth.”

In May, Icon Legacy Custom Modular Homes cut the ribbon on its new facility, embracing growth despite economic challenges. The company was expected to add 50 employees to its workforce.

In Westmoreland County, Serious Materials, recalling some of the 150 employees who lost jobs, purchased the Kensington Window Company’s assets.

Developer Nicholas Moraitis, of Pittsburgh, announced a multi-million dollar development project in Burnham, Mifflin County. The project—which was expected to include a hotel, restaurant, multiplex movie theater, and water park – was being announced inn cooperation with Glenn O. Hawbaker of State College. That company was retained to complete infrastructure development at the 160-acre site.

The annual Showcase for Commerce, held in Johnstown, culminated with the announcement that Lockheed Martin would purchase the local manufacturing technology facility from Concurrent Technologies Corp.  The deal was believed to bring 165 jobs to the region.

Gorell Windows, in Indiana County, recalled the last of its furloughed employees and announced it would hire new employees. The growth was due to the tax rebates on “green” windows.

In July, amid a state budget crisis, Governor Rendell announced a state funding package that would bring two companies, and 185 jobs, to Blair County, Diversapak, LLC, and Advanced Metal Processing were both seen as solid investments.

The Chamber of Business and Industry of Centre County announced it was going to sponsor a new regional business exposition at the Bryce Jordan Center. The CBICC was expected to be joined by at least 12 other chambers in the enterprise.

On July 21, Indiana County received its largest state grant ever, $10.4 million from PENNVEST, a state organization that funds infrastructure development. The money was to be used for sewer and water facilities to support growth along Routes 119 and 22.

Parente Randolph and Beard Miller merged in August, creating one of the nation’s top 25 accounting firms.

With the state budget still unresolved Pennsylvania’s annual international trade meetings were canceled. Pennsylvania has been a leading advocate for exporting and importing for its companies.

With the push for green energy gaining momentum, the Highland Wind Farm in Cambria County received a $42 million dollar federal grant, part of the American Recovery and Reinvestment Act. The grant was part of a total $502 million aimed at green energy projects in eight states.

By the second half of September, the Marcellus Shale natural gas play was bursting with activity. Representatives of more than 125 companies gathered at the Lycoming County Fairgrounds for the Central Susquehanna Oil and Gas Expo.

In October, President Obama and the leaders of the G-20 economic summit gathered in Pittsburgh to discuss ways to cope with economic recovery and financial regulatory reform.

By the end of the month, the nation’s attention turned to health care reform. Throughout this region, health care providers wondered allowed how the coming changes were going to affect their institutions.

The largest solar farm in Pennsylvania was announced in November. The  $32 million project at the Milton Industrial Park, in Northumberland County, was the result of a win-win compromise between industrial and environmental needs.

In December, Geisinger Health Plan announced that it would offer health insurance through the state’s Children’s Health Insurance Program.