Manufacturers lead 2013 capital projects

Business investments in Springfield are growing, according to the Springfield Area Chamber of Commerce’s annual report, and manufacturers are leading the way.

This year, the chamber assisted companies with eight project announcements, 639 new jobs, $23.3 million in new payroll and $43.6 million in capital investments. The latest announcement came Dec. 11, when stainless steel tank manufacturer Stainless Technology revealed plans to add up to 75,000 square feet at its Partnership Industrial Center plant, 4420 E. Mustard Way.

The multimillion-dollar, multiphase capital investment would create up to 88 jobs paying above the Greene County average wage of roughly $36,000 and more than double the company’s current workforce of 69 employees.

A division of Bethlehem, Pa.-based ABEC Inc., Stainless Technology produces tanks and vessels for the biopharmaceutical industry. Spurred by sales growth, the expansion was assisted by Springfield chamber and Springfield Business Development Corp. staff, who helped secure the jobs and investment for Springfield during a competition with another ABEC plant in Pennsylvania.

Tank talk
Half of Springfield’s project announcements this year have come from stainless steel manufacturers. Tank Components Industries, Polar Tank Trailer and Watson Metal Masters Inc. are all in growth mode locally.

Ryan Mooney, the chamber’s senior vice president of economic development, said job and payroll growth have nearly doubled compared to 2012, when 371 jobs and $11.2 million in payroll were added to the market through chamber efforts.

“We are trying to get two more across the goal line here before the end of the year,” Mooney said.

However, capital investments in 2012 were higher at $67.2 million, bolstered by $50 million in equipment upgrades at Kraft Foods Group.

“The projects that we track are the ones that we directly aided … whether we steered it from start to finish or had a role as one of a handful of partners,” Mooney said, noting a trend in recent years. “What we are seeing is a lot of folks focusing on investments and not necessarily as much on the job side. So, you’d see higher numbers on the investment side than maybe you would prerecession, but perhaps not as many jobs added.”

By comparison, between 2002 and 2006, an average of nearly 5,000 jobs per year were added in the Springfield area with the chamber’s assistance, according to Springfield Business Journal archives. A dent was made in the manufacturing industry in July, when Regal Beloit Corp. (NYSE: RBC) said it would cease operations at the company’s East Sunshine Street plant and lay off some 330 employees during an 18-month transition.

Global forces
Earlier this year, Tank Components Industries began construction of an 81,000-square-foot facility in PIC West, a move that will create 27 jobs during the next five years. While preparing to move in by early January, company officials say a steady diet of work orders from local and national stainless steel customers was the impetus behind its project.

“It is just the normal growth of the company,” TCI CEO Dale Sandy said. “We started 13 years ago with six employees, and now we have 52. It has been pretty steady growth over the years.”

The move, its second since starting in 13,000 square feet on West College Street, effectively doubles the operating space to produce such pieces as tank heads, cylinders and handles. TCI has worked from 40,000 square feet at 4520 W. Kearney St., Ste. 100.

Sandy said about 20 percent of the company’s business comes from local stainless steel tank manufacturers such as Watson Metal Masters and 80 percent from national clients.

“In manufacturing, you are always trying to keep up with your manufacturing needs,” Sandy said. “It has been pretty constant for us to add four to six positions per year. As we move into the new facility and get the added capacity that we’ve been needing for the past couple of years, then those are the positions we will need to fill to continue to grow at that rate.”

Earlier this month, TCI client Watson Metal Masters announced a move to Republic with plans to nearly triple its workforce by adding 77 positions through a $4.8 million capital investment. Also, this fall, Polar Tank finished its 27,000-square-foot, $1.4 million expansion in PIC.

Sandy said growth opportunities exist locally, in part, because of emerging global markets.

“We’ve got a fairly niche business, and a lot of our stuff is tied to the world economy as much as anything,” Sandy said, adding several TCI clients serve the pharmaceutical industry. “A lot of the fabrication of those tanks is done here in the United States and then exported all over the world.”

In 2014, Mooney said the chamber plans to spur further economic growth by unveiling an online talent attraction portal promoting the Queen City to potential job candidates.

“We were hearing from companies based in Springfield – mainly large companies, but small, as well – that they can sell their company to people they are interested in recruiting, but what they didn’t have at their fingertips was a great resource to sell Springfield,” Mooney said.

He said health care systems Mercy and CoxHealth are particularly interested in the project to assist in recruiting doctors. Springfield marketing firm Creativore is leading the project, which has a rollout date scheduled for Jan. 24.

“We see the direct economic development tie. If companies based here are not able to attract talent to the area, then they are not going to be able to grow,” Mooney said.