Editor’s Note: This guest column is part of an annual special section called Visions, in which Toledo Free Press asks local economic development and business leaders to share what they see ahead for Toledo and Northwest Ohio in the coming year.
2014 was certainly a year in which economic activity in the Northwest Ohio Regional Economic Development (NORED) region accelerated.
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Significant office developments were announced for the Toledo area, including Dana, ProMedica and The Andersons headquarters projects. In the manufacturing sector, projects at Toledo Refining, Faurecia, GT Technologies and Allermuir U.S. represent noteworthy expansions of production capacity. In the outlying areas, Standard Technologies of Fremont, TRW Automotive in Fayette, Webster Industries of Tiffin, Valfilm North America in Findlay and FirstEnergy Davis-Besse nuclear power plant near Oak Harbor made considerable investments.
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FirstEnergy’s $600 million steam generator replacement and refueling project at Davis-Besse — which I had extensive involvement in — provides a perfect example of how large-scale private sector investments impact our regional economy. At the height of the project in February, 3,200 contract personnel were employed to install two 470-ton steam generators, complete ancillary work associated with these heat exchangers and refuel the plant’s reactor.
This project, along with the plant’s regular operations, provided a total economic impact of $944 million to the state of Ohio in 2014. This figure includes direct, indirect and induced impacts along with fiscal influences on state and local governments. Direct impacts include wages paid to employees and other inputs used directly by the plant. Indirect impacts, or what some economists term spinoff or ripple effects, result from direct purchases. As such, these businesses indirectly increase employees and wages by purchasing goods/services from businesses that supply them. Induced impacts include all household purchases made by Davis-Besse contractor and supplier employees. Total state and local tax impact is estimated to be $13.2 million.
As can be seen by this example, considerable monetary benefits are derived from such projects and this is exactly why collaborative economic development efforts are needed at the local, regional and state levels to help facilitate more like it.
If all commercial indicators can be trusted, similar economic development projects in the NORED region should continue unabated. GDP grew at an annualized rate of 3.9 percent in the third quarter of 2014. Ohio’s unemployment fell to 4.5 percent in November. Consumer confidence in November, as measured by the University of Michigan/Reuters, was the highest since July 2007. These trends combined with lower fuel prices and added automotive purchases, which are now predicted to hit close to 17 million units in 2015, bode well for the NORED region in the coming year.
Hans Rosebrock is president of NORED and manager of economic development and external affairs at FirstEnergy.
