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Neighborhood manufacturing revival: Chicago can build more than skyscrapers

Try walking, bicycling, driving or parking around downtown and it’s clear we’re in the midst of a high-rise construction bonanza.

At the same time, however, the stage is being set for another type of economic boom: A neighborhood manufacturing revival.

It’s as vital to the commercial and employment well-being of the city as the rush of attention-grabbing, $1 billion-plus office and upper-end residential developments being built.

Chicago business and political leaders would be smart to capitalize on this impending manufacturing opportunity, which can jump-start neighborhood employment and spawn other related area businesses.

While beset by constant overseas competitors and a fickle marketplace, U.S. manufacturing — especially in urban areas — is starting to rebound.

The economy is strong and industrial orders are solid, the Trump administration is stressing the need for made-in-America goods, and Congress is seeking to lower business taxes.

Chicago is in a unique position to take advantage of the rebounding manufacturing environment.

With a national unemployment rate around 5 percent, there’s a labor shortage that’s hurting rural-based manufacturers much more than those operating in big cities.

Even in Indiana — often seen as Illinois’ economic nemesis — a chronic worker shortage in rural “company towns” is forcing employers to look into relocating operations to urban centers like Chicago.

For those coming to Chicago, there’s no shortage of available industrial space opportunities. Same goes for firms already here that must relocate because their facilities are in the pathway of encroaching real estate developers.

Chicago has 26 designated industrial corridors, located in nearly every city corner and containing two-thirds of all the land that’s zoned for manufacturing.

That group includes 15 planned manufacturing districts, areas that are zoned to restrict land for mostly industrial uses. Last year, City Hall announced plans to modernize Chicago’s industrial corridors, raising some fears the overall plan could reduce manufacturing space.

As in any real estate deal, location is important. That’s Chicago’s edge.

Many of the city neighborhoods where these industrial and light manufacturing sites are available are a couple of miles from expressways, airports, and rail lines — transportation arteries that are essential to getting products to customers.

It’s a logistics play that’s essential to manufacturers pressed to meet today’s real-time delivery demands.

“Making things is important,” says David Doig, president of the nonprofit Chicago Neighborhood Initiatives, which works on many grassroots commercial redevelopment projects. “But, it’s also about getting stuff where it needs to be sent.”

Yet if Chicago is going to attract and retain more manufacturing jobs, City Hall needs to be involved.

Smarting from criticism the Emanuel administration is more focused on downtown development and wooing corporate headquarters, it’s been keen on deploying methods aimed at attracting and keeping manufacturers.

In recent years Chicago has scored some notable victories. Finkl Steel relocated to the South Side from Lincoln Park, as did Vienna Beef from Bucktown. San Francisco-based Method Products opened a plant in historic Pullman Park.

Through its industrial growth zones program, the city helps potential tenants find a site, speed the permit process and locate financial assistance. It also provides job training and seeks to bridge the “skills gap” by connecting workers with employers.

The city also is pushing real estate gurus developing those downtown office buildings to pitch in a little for community improvements through the Neighborhood Opportunity Fund. Simply stated, some money from downtown developments is funneled into commercial corridors, primarily for business districts.

A similar plan to encourage neighborhood manufacturing may soon surface, say City Hall sources.

But such public policy backing isn’t enough.

The private sector’s involvement is essential to getting the most out of the neighborhood manufacturing scene.

Established companies of all sizes, startups and entrepreneurs, must be willing to take a calculated risk on the city’s industrial footprint.

As important, banks have to back their play with loans that will help get these manufacturing projects up and running.

I think the potential payback for everyone involved could be tremendous.

For too long, Chicago has squandered its industrial legacy or shied away from it because of concerns that manufacturing is too dirty or not fulfilling as a career.

But the high-tech manufacturing world is dramatically different from the old smokestack era. These days, factories are smaller, cleaner and leaner.

They’re also tapping into digital technologies and churning out customized parts and products for major industries, including the Midwest-oriented automotive business.

That’s a pretty good job skill for a new economy.

So let’s not abandon Chicago’s manufacturing side or squander this resurgence.

We can build more than office towers.

roreed@chicagotribune.com

Twitter @reedtribbiz

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