Ohio Manufacturing GDP Reaches New All-Time High

Key Economic Insights

• Global: Italy hosted the G20 Summit and the United Kingdom is hosting world leaders from over 100 countries as part of the UN Climate Change Conference COP26 in Glasgow.
• U.S.: U.S. GDP rose at a 2.0% annualized rate in Q3 as spending and business investment growth sagged.
• Ohio: Ohio’s manufacturing GDP was nearly $117B in Q2 of 2021, up from $112.4B in Q4 2019.

Global Insights

Economists see central banks reducing emergency stimulus too quickly and further supply chain disruptions among the top risks to the world economy next year. The European Central Bank kept its monetary policy unchanged, with interest rates remaining in negative territory. The region’s economic output is expected to return to its pre-pandemic level in early 2022, up to a year later than the larger U.S. economy.

The Bank of Japan kept monetary policy unchanged, and the central bank cut its real GDP growth outlook and consumer inflation forecasts for fiscal 2021. Oil prices retreated from seven-year highs this week after the U.S. showed a rise in domestic crude inventories and amid reports that Iran may soon revive talks on a nuclear deal. World leaders from more than 100 countries are convening in Glasgow for the U.N.’s 26th COP summit. 49.5% of the world population has received at least one dose of a COVID-19 vaccine.

U.S. Insights

Weekly jobless claims fell to a new pandemic-era low for the week ended October 23. Initial claims fell to 281,000, down from 291,000 the prior week. Continuing claims dropped to 2.243M, down from 2.48M the prior week.  U.S. economic growth decelerated in Q3 as GDP rose at a 2.0% annualized rate according to the first estimate released by the BEA. Consumption slowed to 1.6% in Q3, the weakest pace since Q2 of 2020. U.S. consumer spending increased in September, rising 0.6% following a 1.0% gain in August. U.S. personal income fell 1.0% in September after rising 0.2% in August.

New home sales rose 14% in September after falling 1.4% in August. Pending home sales fell 2.3% in September from August, likely due to higher mortgage rates. U.S. durable goods orders decreased 0.4% to a seasonally adjusted $261.3B in September after rising 1.3% in August.  The U.S trade deficit in goods increased 9.2% to $96.3B in September. The University of Michigan’s Consumer Sentiment index remained virtually unchanged from its mid-month reading, rising to 71.7 in October. Nearly 66% of the U.S. population has received at least one dose of a COVID-19 vaccine, and over 57% is fully vaccinated.

Ohio Employment & Economic Insights

The Ohio Tax Credit Authority approved assistance for five economic development projects across the state. The projects are set to create 679 new jobs and retain 549 jobs statewide, resulting in more than $42M in new payroll and more than $12M in investment. Ohio’s record year of new business filings continues, as the state reported 14,543 new business formations for the month of September. Through the first nine months of 2021, 156,600 new businesses have formed in Ohio, a 21% increase over the first nine months of 2020 (129,697), which was a record year for the state.  Ohio manufacturing economic output surpassed the sector’s previous highwater mark set in late 2019. Ohio’s manufacturing GDP was nearly $117B in Q2 of this year, up from $94.7B in Q2 2020 and from $112.4B in Q4 2019.  Ohio reached two records in job postings – the most total jobs available and positions with salaries over $50,000. There are 269,287 total jobs available and 150,284 paying more than $50,000 a year, according to Ohio Means Jobs website.

Alaska Airlines is adding a new nonstop flight between Seattle and Cleveland and also adding a second nonstop flight connecting to Columbus and Cincinnati. The routes will better connect Ohio’s financial services sector, healthcare systems and tech industries to markets on the West Coast and Asia, while also giving the West Coast easier opportunities to do business in Ohio.  Ohio leaders met with members of FIFA and the U.S. Soccer Delegation in Cincinnati as the city bids to host the FIFA World Cup games in 2026.  Ohio State University was ranked the #52 best global university out of more than 1,700 universities in the 2022 U.S. News Best Global Universities. Case Western Reserve University is #42 among all national universities. Ohio’s research universities ranked in the top 20 in space science.

A total of $250M in grant funding will be invested in water infrastructure projects across the state as part of the new Ohio BUILDS initiative. The first round of water infrastructure grants will award $93M to 54 projects that impact communities in 60 Ohio counties.  Ohio’s H2Ohio initiative continues its growth in participation as 800 producers in the 10-county H2Ohio expansion area of the Western Lake Erie Basin have enrolled 600,000 additional acres in the program.  The second phase of construction on new electric transmission infrastructure in Trumbull County is underway by FirstEnergy Corp. The $12M project will help support the energy demands of the area’s rapidly expanding electric vehicle industry by building a new, high-voltage power line in Lordstown.  Nearly 6.5M Ohioans have started the COVID-19 vaccination process, marking 64.8% of the population currently eligible.

Positive Company-Specific News

• Sherwin-Williams broke ground on a new 600,000 SF R&D Center in Brecksville. The facility will focus on the development of future products and services, and support product development, coatings research, color technology and process engineering, generating around 3,000 jobs.
• AES Ohio commemorated the completion of the AES Smart Operations Center at MacGregor Park. This state-of-the-art facility represents a new era of innovative energy solutions and the company’s efforts to accelerate a safer, greener, and cleaner energy future in the U.S. and globally.
• Fifth Third and Enterprise Community Partners announced the establishment of a $20M neighborhood program to support and revitalize the Buckeye neighborhood in Cleveland.
• Alliance Data Systems is investing $100M this year in digital technologies that broaden its consumer credit options beyond exclusive retail deals and cards in wallets. The company is also transferring its credit processing to Fiserv, opening more digital capabilities.
• NorthPoint Development purchased land at the former NorthTowne Square Mall in west Toledo and plans to convert the 60 acres of vacant land into an industrial park. At least 500 new jobs will result from the $70M economic development project. The development will also create 200 construction jobs.
• Ahmic Aerospace received a $50,000 grant from JobsOhio to expand its R&D activities and hire new staff, with plans to double its workforce in the next three years.
• Iten Defense expects to create 102 full-time positions, generating $3.7M in new annual payroll and retaining $3.1M in existing payroll as a result of the company’s expansion project in Saybrook.
• Tenet3 LLC is relocating their HQ to downtown Dayton. The project represents a $1.5M investment and will bring 44 jobs to the city core.
• New River Electrical is planning a $12M regional HQ at the new Enterprise Center Business Park in Johnstown. The facility will employ 55 people, with $8M in payroll.
• Exela Technologies, through its partnership with Caresource, is creating 100 jobs at a new office in Dayton.
• Coterie Insurance, a Blue Ash-based insurtech startup, closed a $50M Series B financing round, one day after the company landed tax credits from state of Ohio to create nearly a dozen new jobs in the region.
• Roadtrippers surpassed five million members. The Cincinnati-based company said the growth has been driven by the continued interest in road-based travel.

Resources

• Ohio Department of Health’s COVID-19 Website: coronavirus.ohio.gov
• JobsOhio’s information about Open, Secure Supply Chains in Ohio