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What's Driving the Economic Turnaround in Youngstown and Canton, Ohio?

Youngstown had been one of those Rust Belt, "shrinking" cities long noted in Planetizen, but thanks in part to fracking and its location on the Utica shale formation, manufacturing has returned and unemployment has dropped by half since 2010.
September 9, 2014, 9am PDT | Irvin Dawid
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"The turnaround is part of a transformation spreading across the heartland of the nation, driven by a surge in domestic oil and gas production that is changing the economic calculus for old industries and downtrodden cities alike," writes Nelson D. Schwartz, economics reporter for The New York Times.

Here in Ohio, in an arc stretching south from Youngstown past Canton and into the rural parts of the state where much of the natural gas is being drawn from shale deep underground, entire sectors like manufacturing, hotels, real estate and even law are being reshaped.

One example provided is Paris-based Vallourec, a manufacturer of products for energy extraction. While it's not the Youngstown of old, it is a turnaround nonetheless.

Vallourec’s state-of-the-art pipe mill has about 350 workers; the old Youngstown Sheet & Tube plant that once stood on the site had a work force of 1,400 when it shut down in 1979.

Northeastern Ohio is showing itself to be a region that is "renewing itself" according to Katy George, "who leads the global manufacturing practice at McKinsey & Company, the consulting firm." 

A 2013 McKinsey study co-written by Ms. George estimated that production of shale gas and so-called tight oil from shale could help create up to 1.7 million jobs nationally. Many of those jobs are expected to end up in places like this, in part because they are close to newly developed fields like the nearby Utica shale formation.

The other northeastern Ohio city that Schwartz highlights is Canton, comparing both to Cleveland, "which went through an earlier revival as more white-collar jobs arrived."

In the energy surge, Canton has emerged as the center for white-collar jobs associated with the energy industry, like engineers, surveyors and other specialists. About an hour’s drive from both Cleveland and Youngstown, Canton borders the rural region farther south in Ohio where increasingly large quantities of natural gas are being pumped out of the Utica shale.

Youngstown's economic rebirth has not gone unnoticed by President Barack Obama, who spoke about an manufacturing complex in his State of the Union address last year - captured by NPR.

Ned Hill, Dean of the Maxine Goodman Levin College of Urban Affairs at Cleveland State University, illustrates the turnaround from a parking perspective.

“Both Youngstown and Canton are places which experienced nothing but disinvestment for 40 years,” he said. Now,"they’re not ghost towns anymore. You actually have to go into reverse to find a parking spot downtown.”

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Published on Monday, September 8, 2014 in The New York Times - Business Day
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