Trends in Industry in Allen County: Current
David Steiner authored and presented an article titled "Trends in Industry in Allen County" for the Quest Club of Fort Wayne. The excerpt below is the Current Trends portion of the article. Click here for the entire paper.
CURRENT INDUSTRY TRENDS IN ALLEN COUNTY
The hard lesson of a community being too reliant on a few large employers has motivated government, business, and community leaders to focus for many years since Harvester’s closing on diversifying our economy. In his 2011 Quest Paper on “100 years of the Fort Wayne Economy,” fellow Quester Mac Parker described Fort Wayne’s economy as moving through four “Acts.” Act 1 was the canal period, Act 2, the railroad period, and Act 3, the manufacturing period. Act 4 is “the knowledge-based economy,” which calls to mind high tech centers like Silicon Valley and Research Triangle in North Carolina, but also -- closer to home-Indianapolis, which has diversified into biosciences, pharmaceuticals, and as a sports and convention center. It’s a tall order for Allen County to move completely from its manufacturing base to a knowledge-based economy. But the Fort Wayne area has taken steps to lessen its dependence on manufacturing and grow in other areas, such as health care and education services, along with other service-related jobs. And, to a certain extent, “advanced manufacturing” -- requiring unique engineering and technology application -- is a combination of both.(9) It seems fair to say that Allen County is somewhere in the Act 3.5 stage.
And, more generally, anyone who has lived in the Fort Wayne area from the difficult post-Harvester years to the present must admit we are in a much better place. Community leaders and promoters have been championing building a “nationally recognized economy.” The bold 2015 “Road to One Million” vision of the Northeast Indiana Regional Partnership -- a vision to grow the region’s population from 789,015 residents in 2015 to one million by 2031 -- earned northeast Indiana $42 million in Regional Cities grant money from the state. That award has been leveraged into more than $258 million “quality of life” projects designed to retain and attract a younger and more educated workforce.(10)
The latest and most dramatic signal of the success of the community’s efforts came in early January of this year with the closing on funding for the $280 million Electric Works redevelopment of the former General Electric west campus. The significance of this accomplishment cannot be overstated. As ambitious as the Road to One Million was, it could only identify the redevelopment of the GE campus as a “vision project,” rather than a “near-term” or even “long-term” project. But with completion of the redevelopment targeted for mid-to-late 2022, it will have been accomplished in seven years. A central piece of the redevelopment is retaining the corporate headquarters of Do it Best Corporation in Allen County, with the likelihood of further job growth at its new location.
Manufacturing continues to be a significant part of our local economy. According to Rachel Blakeman of the Community Research Institute, while total employment has decreased from 37,400 jobs in 1990 to 30,000 in 2019, manufacturing GDP has never been higher, meaning we are seeing much higher productivity per employee.(11) Vehicle manufacturing continues to be a significant sector, led by General Motors truck assembly plant, employing 4,200, BFGoodrich tire plant in Woodburn, employing 1,640, Dana light axle plant, employing over 800, and Brunswick Corporation’s pontoon boat plant, employing over 400.
However, the sector that has seen the most dramatic increase has been in healthcare and education, including hospitals and ancillary health services. From 1990 to 2019, that sector has seen an increase of nearly 21,000 jobs, to a total of more than 38,000 in Allen County.(12) That represents more than 20% of all of the employed persons in the county. Parkview Health System is the largest employer in the Fort Wayne area with a head count of 7,858. Lutheran Health Network follows as the second-largest employer at 4,768. Most indicative of this growth is the massive $550 million Parkview Regional Medical Center opened in 2012. Lutheran is also constructing a new smaller downtown hospital to replace the adjacent existing St. Joseph Hospital, at an investment of around $100 million, which is planned to open in early 2022.
Another newer sector, logistics and e-commerce, has also seen significant growth. Employment leaders in this sector include Sweetwater Sound, which reported adding more than 400 new jobs in the past year, increasing its workforce to nearly 2,000 and having annual sales of more than $1 billion in 2020.(13) Sweetwater was fortunate to have completed and fully stocked its new 480,000-square-foot distribution center in February 2020, just prior to the COVID-19 lockdown, and was able to remain open as an “essential business” throughout. Customer demand soared as professional musicians, schools and churches beefed up their investments in recording and communication equipment during the pandemic.(14)
Do it Best and Sirva (a global relocation and moving services provider), each employing between 400 and 500 in the county, are also considered part of this sector. Adding to this sector is the announcement in the Fall of 2020 of Amazon’s plans to construct a new $60 million, nearly 630,000-square-foot distribution facility near the Fort Wayne International Airport.(15) Greater Fort Wayne reports Amazon will have a total investment of $89 million and add 1,320 new jobs.(16)
The financial activities sector, which would include banking and insurance, has lost about 18% of its jobs from 1990 to 2019, to a total of about 10,700. One factor contributing to that decline could be the move of Lincoln Life’s headquarters and related corporate divisions out of Fort Wayne in 1999, although it continues to be one of the county’s largest employers at 1,954 jobs. In addition, Medical Protective (founded in Fort Wayne, but now owned by Berkshire Hathaway) employs nearly 400, and Ash Brokerage and Brotherhood Mutual Insurance Company each employ over 500. The brick-and-mortar presence of these last two insurance businesses has grown dramatically in recent years. In 2016, the impressive Ash Skyline Plaza opened in the heart of Fort Wayne, including Indiana’s largest rooftop green space at approximately one acre.(17)
Brotherhood, a leading insurer of churches and related ministries across the nation, will in the second quarter of 2021 be completing its third major expansion in the last decade or so, including 88,000 square feet of office, meeting and auditorium space at its campus near the Coldwater Road / I-69 interchange. The expansion will create enough additional space to increase the local workforce by 300 in the next few years.(18) On a personal note, my father, Paul, retired as President of Brotherhood in the mid-1990s, having devoted 30 years with the company and leading its growth and transition from its small one-story office on Vance Avenue to the company’s current campus location.
A number of community, regional, and national banks have a presence in the Fort Wayne area, including Lake City Bank, First Merchants Bank, and Old National Bank. Most of them have offices in the downtown area in prominent locations. Late last month, Star Financial Bank, the only community bank with its headquarters in Fort Wayne, announced plans to open a new headquarters in the “Ashberry Project” at the corner of Main Street and Maiden Lane in downtown. The project includes a 7-story, 50,000-square-foot tower along Main Street that will house Star’s offices, and a 3-story, 30,000-square-foot mixed use building along Berry Street, which will be joined together by a 387-space public parking garage. The $43 million development will be the new home to over 220 Star employees.(19)
Military and defense-related employers still continue to have a significant presence in the Fort Wayne area. The largest of these includes BAE Systems, employing 833, and L3 Harris Technologies, Raytheon, and General Dynamics, employing approximately 1,400 among them. The Indiana Air National Guard 122nd Fighter Wing also employs an additional 650 people.
Apart from the increasing diversity of employment in Allen County, we are fortunate to have many of the large leading employers headquartered here. Certainly, Parkview Health, by its sheer size is the dominant example. I’ve mentioned already Sweetwater Sound, Brotherhood Mutual, Ash Brokerage, Med Pro, Do it Best, and Star Financial Bank.
Another is Vera Bradley, founded in Fort Wayne in 1982 by Barbara Baekgaard and Pat Miller, which is known world-wide for its signature colorful quilted handbags, luggage, and accessories. For many years, my wife, Beth, sported a stylish Vera diaper bag and duffle stuffed with toys, books, and blankets for our baby boys. Vera Bradley employees 600, and its headquarters -- emblazoned with the company name -- greets travelers heading north on I-69 into the Fort Wayne area.
A few other examples are Franklin Electric, Fort Wayne Metals, and Steel Dynamics. Best known for manufacturing submersible pumps, Franklin Electric in 2013 opened its new world headquarters and engineering center near Fort Wayne International Airport. The company was founded by two Fort Wayne businessmen in 1944 in Bluffton, Indiana. The company took its name in honor of Benjamin Franklin, considered by the company founders as the country’s first electrical engineer. Its first product was a backpack generator to power radio equipment for U.S. military in World War II.
Incorporated in 1970, Fort Wayne Metals Research Products Corp. has become a world-class leader in the manufacturing of medical wire. The company has grown a campus of buildings near the Fort Wayne International Airport and employs over 1,000 people.
Started in 1993, Steel Dynamics was the idea of small group of former Nucor steel managers who decided to strike out on their own to create a steel company, designed to use electric arc furnaces to melt recycled steel to create new steel products. In 2007, SDI acquired another local company, OmniSource Corporation, to integrate OmniSource’s scrap metals business into its steelmaking supply chain. SDI’s corporate headquarters are located in the former Midwestern United Life Insurance Company building on West Jefferson.
My firm has had the privilege of representing SDI since its earliest days. I was an associate in the law firm in the early 1990s when it was mentioned that one of our senior lawyers was advising a client on a “Project X” new business venture that was being kept very confidential. A package of very important documents related to the venture’s financing needed to be signed by our client and delivered to New York all in the same day. Complicating matters was that our client’s location was temporary office space on the north side of Indianapolis. My job was to drive the package to Indianapolis, get our client’s signature, seal up the package, drive to the Indianapolis airport and deliver the package to the airline ticket counter where it would be loaded on a plane bound for New York that afternoon. Law school had not prepared me for this! But I carefully drove the package, met our client, obtained the signatures, and successfully delivered the package to the airline. The package made it to New York later that day, and the rest is history.
Today, SDI employs nearly 900 in Allen County and is one of the country’s largest domestic steel producers. It had $9.6 billion in net sales in 2020. Not only is SDI a successful steel company, Fortune Magazine recently named SDI one of the 2021 World’s Most Admired Companies and No. 1 with the metals industry. Certainly a point of pride for all of us that a Fort Wayne company is acknowledged worldwide for doing business the right way.(20)
There are many other examples of admired and well-run Allen County businesses, and this is only the most recent and notable. But recognition like that raises the visibility of the Fort Wayne area to the world in a positive way and can only help with talent attraction.
So what are the trends in Allen County industry? What economic opportunities are on the horizon for our community? Let’s first look at some of the challenges.
(9) “100 Years of the Fort Wayne Economy”, Quest Club Paper of Mac Parker, December 2, 2011.
(10) “Better Together”, John Sampson, from “The Future”, Fort Wayne Monthly, January 2021, accessed at http://thedesignhornet.com/books/iili.
(11) Phone interview with Rachel Blakeman, January 11, 2021 (hereinafter, “Blakeman phone interview”).
(12) Blakeman phone interview.
(13) “Sweetwater has big year”, Sherry Slater, The Journal Gazette, January 28, 2021.
(15) “Amazon to build new Fort Wayne warehouse”, Wane.com, posted October 26, 2020.
(16) “Allen County stands tall, continues growth in 2020”, https://www.greaterfortwayneinc.com, posted January 4, 2020.
(17) “The Building that Brings Us Together”, https://www.ashbrokerage.com/About/Skyline, searched February 7, 2021.
(18 )“Brotherhood Mutual to expand, add 100 jobs”, Sherry Slater, The Journal Gazette, June 8, 2019.
(19) “STAR Bank Announces New HQ in Downtown Fort Wayne”, Wes Mills, Inside Indiana Business, https://www.insideindianabusiness.com, posted January 27, 2021.
(20) “Steel Dynamics Named One of World’s Most Admired Companies by Fortune” Press Release. https://markets.businessinsider.com/news/stocks/st... companies-by-fortune-1030028718, posted February 1, 2021.