A Slow Recovery: Five part series examining the economic recovery and its impact on different facets of the region
December 31, 2009 6:15 AM
Dennis Davin talks about what has hapened in economic development for the region, December 18, 2009.
By Ann Belser Pittsburgh Post-Gazette
If there is anyone who did not hear the message during the run-up to September's G-20 meeting about Pittsburgh's stunning recovery from the rusting hulk of abandoned steel mills to a high tech city devoted to health care and education, they must have been in seclusion in the Amazon.
For all the great press, unemployment remains an issue, companies still are struggling, and while the region boasts thousands of acres of land ready for development, that is still land that is undeveloped.
In other words, there is still a lot more work to do in terms of economic development.
That work may be slowed some as local agencies dedicated to economic development, such as the Technology Collaborative, the Pittsburgh Life Science Greenhouse and Innovation Works, have experienced funding cuts from the state.
Those current woes, however, won't cut short future economic development, said Dennis Davin, the director of the Allegheny County Department of Community Development.
A Slow Recovery
As part of a weeklong series, Post-Gazette business reporters are examining the economic recovery and its impact on different facets of the region.
Today: Economic development organizations are finding sources of money are harder to come by as the need has increased. But local development groups have found ways to be creative.
Friday: Individuals could be the last to experience the recovery as unemployment is not expected to improve for a while.
"This budget has been very, very tough," Mr. Davin said.
But Mr. Davin is paid to be an optimist, and he noted that earlier in the decade, when the Community Development Block Grant money was cut back, his office took a huge hit, and lost four people when County Executive Dan Onorato took office and laid off 500 workers countywide. Still, he said, a lot of good work was done.
For the short term, the money for start-up companies is tight, but Mr. Davin isn't betting the county on fledgling companies saving the future. Instead, he is looking toward helping companies that already exist to do better.
Medrad Inc., Bayer AG and ATI Allegheny Ludlum are all expanding in the region. The relocation and expansion of Westinghouse Electric Corp. from Monroeville to Cranberry was not a loss for Allegheny County, Mr. Davin said. Instead it was a win, because the company stayed in the region.
Another of the region's economic generators has been Dick's Sporting Goods, which has turned the airport corridor into a version of Bentonville, Ark., Mr. Davin said.
The company started with a 65,000-square-foot building, grew to a 200,000-square-foot space and now has a 700,000-square-foot headquarters right at the taxiway of Pittsburgh International Airport.
Dick's growth has spawned satellite offices for sporting goods companies, such as Nike and Adidas, to locate the members of their sales teams that are dedicated to selling their products through Dick's, the same way companies have opened sales offices in Bentonville, home of Wal-Mart.
Another arrow in the region's economic quiver is PNC Financial Services Group, one of the survivors of the banking crisis that grew when it acquired struggling National City. PNC has given the region a stable financial institution, Mr. Davin said.
He said by helping companies here flourish, it offers the opportunity to provide land for larger locations.
Examples of companies that he hopes will stay and grow include Stemnion Inc., which is using placental stem cells to try to develop treatments to heal diabetic ulcers and burns, the later of which is of great interest to the military. If the treatment, which still is a long way from being approved for humans, is successful, Allegheny County could become home to a major new medical company.
Plextronics in Harmarville is another company that is on the cutting edge of science using organic means to create energy and harness solar power for low-power circuitry.
Both companies grew from local research.
"We bring in over a billion dollars for institutions for research and development," Mr. Davin said.
He said it was important to keep the business incubators going so the Life Sciences Greenhouse that worked with Stemnion and Innovation Works that helped Plextronics will have more technologies in the pipeline that could become tomorrow's major local employers.
"When the economy gets back to where it was two or three years ago, I think these organizations are going to get back to where they were three years ago," he said. "I think they are going through rough economic times now."
In Mr. Davin's view, the same geographic factors that made Pittsburgh an economic powerhouse in the middle of the last century will make it an economic powerhouse in this one, too.
It's not just the industries that are here, but also the natural resources, such as coal, which is still being mined from the region and is not going to disappear as a major power source anytime soon, and the Marcellus shale, which is attracting companies to its abundance of natural gas.
That means the basic factors that led to Pittsburgh's rise are still here, bringing around Pittsburgh's renewal.