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Shapiro, LVEDC tout Lehigh Valley’s economic success at annual meeting

Pa. Gov. Josh Shapiro speaks at the LVEDC annual meeting at SteelStacks in Bethlehem. PHOTO/STACY WESCOE
Pa. Gov. Josh Shapiro speaks at the LVEDC annual meeting at SteelStacks in Bethlehem. PHOTO/STACY WESCOE –

Saying that if Pennsylvania wants to show that it’s “open for business” it needs to work at the speed of business and not at the speed of government, Gov. Josh Shapiro was the featured speaker at the 2023 Lehigh Valley Economic Development Corp. annual meeting at SteelStacks in Bethlehem. 

Tuesday’s event was the first live event the LVEDC held since 2019 and the standing-room-only crowd was the largest the event has had since it was formed in 1995, no doubt because of the featured speaker. 

Shapiro highlighted what his administration is doing to make Pennsylvania a more business-friendly state, including speeding up the licensing and permitting process and offering a money-back guarantee to businesses if their permits aren’t decided by the promised time. 

He called the Lehigh Valley a shining example of what can be done when business, government and stakeholders, like the LVEDC can do when they work together. 

LVEDC President and CEO Don Cunningham told the crowd that once again the Lehigh Valley was named as one of the top 10 regions for new development by Site Selection Magazine. 

For 2022, the Lehigh Valley was ranked number two for regions of its size for new development with 46 new projects under development during the year. 

It was bested only by Greensboro, South Carolina, which had two more projects under development in 2022 than the Lehigh Valley. 

He also noted that the Lehigh Valley has seen a rebound in the manufacturing sector. 

While many still think of the days when Bethlehem Steel was a major force in the Lehigh Valley, Cunningham said industry has modernized and diversified with major national manufacturers like B Braun, Martin Guitar and Crayola, which bring the same sort of pride to the workforce that the Steel did in its heyday. 

“Our strength is in our balanced economy,” he said. 

He said last year manufacturing once again became the top economic sector for the Lehigh Valley for the first time in 15 years, making up 18% of the region’s economic output. 

Cunningham noted that there are 75,000 people employed in the logistics and warehousing industry in the region, and while the term “warehouse” may conjure up negative connotations for many, he said that they are an important part of the post COVID-19 economy as manufacturers realize they need to make and source products closer to U.S. population centers, making the Lehigh Valley a go-to place for business. 

He also pointed to companies like Shift4 Payments of Allentown, a tech company which has grown dramatically in recent years and put the Lehigh Valley on the global map with founder Jared Isaacman recently going to space on missions with SpaceX. 

Congresswoman Susan Wild also spoke at the event. She said that interest in the Lehigh Valley from companies is so high, she regularly meets with company officials in her Washington office, who are looking to locate in the Lehigh Valley because of the good things they have heard about the region. 

Supporters, detractors debate former governor’s complicated legacy

Governor Josh Shapiro was just minutes into his inaugural speech on Tuesday, Jan. 17, when he turned to address the outgoing chief executive, Gov. Tom Wolf. 

“Thanks to his leadership,” Shapiro stated, “we now find ourselves in the strongest financial shape in the history of the Commonwealth of Pennsylvania, allowing us to make critical investments for tomorrow.” 

Supporters of Wolf likely found Shapiro’s praise for his predecessor providing a moment of warmth on a day otherwise chilled by wintry wind and leaden skies. The President & CEO of Lehigh Valley Economic Development Corp., Don Cunningham, believed Wolf’s greatest contribution to the state’s businesses and economy to be the reduction of the corporate net income tax from 9.99% to 4.99% by 2031. 

“It’s very significant for those of us to do economic development,” Cunningham said. “He proposed it in his budgets and finally got agreement from Senate Republicans. That’s what leaders do.” 

Not everyone on that gray inaugural day shared Shapiro’s sunny sentiments for Wolf’s impact on Pennsylvania’s businesses. State Senator Scott Martin (R-Berks/Lancaster) said there was “a lot of frustration” the past eight years. The reason being that many of Wolf’s policies were, said Martin, “counterproductive to Pennsylvania tapping into its full economic potential.” 

David N. Taylor, president & CEO of the Pennsylvania Manufacturer’s Association, cites the “deeply disturbing” practices of the Wolf Administration that he says have destroyed an untold number of businesses in Pennsylvania. 

“Governor Wolf, during his tenure, was markedly unhelpful to Pennsylvania’s business competitiveness,” Taylor said. “At every turn, he was pushing for more government, higher spending, and he did a number of specific things that were especially damaging to the economy.” 

One such thing, said Taylor, was the 2017 Tax Cuts and Job Act (TCJA), which changed the depreciation, deductions, tax credits, and tax items that affect business. 

“When the tax policy was changed at the federal level, that was the starting gun for the process of American companies considering where to bring those overseas earnings to reinvest in America,” Taylor said. “Pennsylvania was the only state to say ‘no’.”  

Another point of contention was the additional tax on the production of natural gas in Pennsylvania that Taylor said Wolf called for in his annual budget addresses. 

“Even though he was never going to get that, the fact that you had the sitting governor calling for it rendered our investment environment uncertain,” Taylor said. “If you want to go back and look at when the rigs stopped coming in or when did they start leaving, 2015 was that turning point.” 

Jon Anzur, vice president of public affairs for the PA Chamber, called Wolf’s record on working with the business community “a mixed bag.” 

At the beginning of Wolf’s first term, he had what Anzur said was “a very adversarial” relationship with the business community. The issue at the heart of the impasse were business-related, a tax-and-spend approach not in line with the business community. 

“As Wolf went along,” said Anzur, “rather than treat the business community as an adversary, he treated it as a partner.” 

Supporters of the Wolf Administration point to what they see as life-changing investments in the people of Pennsylvania and the building of a business-friendly climate via the following actions: 

  • Collaborated with 430 companies to create and retain close to 194,000 jobs. 
  • Diversified state contracting so that diverse, small, and veteran businesses comprise 20% of Pennsylvania’s contractors. 
  • Eliminated the Capital Stock and Franchise Tax. 
  • Launched Manufacturing PA to link job training to career pathways. 
  • Partnered with the private sector to address the worker shortage. 
  • Placed Pennsylvania on track to a Corporate Net Income Tax rate of 4.99%. 
  • Reformed Occupational licensure to cut red tape, help workers, and strengthen the workforce. 
  • Distributed grants to help more than 10,000 small businesses and the hospitality industry survive the pandemic. 

“He did some things that were very focused on what we need to do to grow the economy,” Cunningham said. 

At the same time, Wolf’s handling of COVID-19 came under criticism. A state audit called the business waiver program confusing and inconsistent, declaring that it created for Pennsylvania companies an unfair playing field. 

Martin agreed. “Direct competitors, even in my own district, one would get a waiver to stay open and their direct competitor would not,” he said. 

Taylor recalled Wolf’s shutting down of businesses being done without the okay of those whose livelihoods were affected by the decision. 

“There was no outreach to say, ‘How will this play out in the real world?’” Taylor said. “You would think any leader would want to have the most comprehensive overview information as to how will this play out… Governor Wolf didn’t reach out to anyone.” 

Like many politicians, Wolf leaves behind a legacy that is complicated and conflicting. Supporters say it abounds with innovative programs, people-driven policies, and investments aimed at creating a more prosperous Pennsylvania. The Rainy Day Fund, dangerously low when Wolf took office, now stands at an historic $5 billion, and his administration secured a $5.3 billion budget surplus, albeit aided with federal funding. Still, Wolf is the first governor since 1987 to hand his successor a surplus. 

Critics call Wolf’s business policies catastrophic and see the former governor, in Taylor’s words, “hurling down thunderbolts from on high” during the pandemic, preventing citizens and their enterprises from adapting to the circumstances, forcing them to “sit back, do nothing, and watch their business die.” 

Martin likewise believed Wolf’s policies made the pandemic worse, and that Pennsylvania’s businesses have not fully recovered. 

“Businesses continue to struggle and some no longer exist because of the policies he put in place,” said Martin. “It had a lasting impact.” 

Cunningham noted that Wolf was operating in real time and trying to find the balance between keeping people safe and keeping businesses open. 

Good and bad, Wolf’s two terms provided what Anzur termed “an evolution in office,” the former governor finding “common ground to move the ball forward for Pennsylvania.” 

As recession looms over 2023 local leaders see hope

As the nation rings in the New Year, it has the “R” word on its mind. 

Many economists are predicting a recession in 2023, but opinions vary on how bad it could be and just what would be impacted. 

Don Cunningham, president and CEO of the Lehigh Valley Economic Development Corp., said from what he’s being told all of the signs are there pointing towards recessionary conditions, but if a recession does come, he doesn’t think it will hit the Lehigh Valley as hard as some other regions. 

He noted that there is a strong diversity of industries in the Lehigh Valley and there remains a strong interest in locating here. 

A recent report by Century 21 Commercial showed that the Lehigh Valley industrial market had the tenth lowest vacancy rate in the nation, and the second in the Northeast region, behind only the New York Metro. 

“Looking ahead I think most people are forecasting a little bit of a slowdown in the industrial market,” Cunningham said. “But we’re not there yet.” 

He said the popularity of the region for warehousing and light industrial companies may be one thing that slows down economic development in 2023. 

“A lack of locations and higher interest rates could impact the economy,” he said. 

The commercial office space may continue to remain slow in 2023.  Many companies have adopted work from home or hybrid office policies that mean most aren’t opening new office space right now. 

Richard Hobbs, president and CEO of the Manufacturers Resource Center, said for the most part many of the issues that manufacturers faced in 2022 will carry over into this year. 

He said the looming recession and higher interest rates will be factors that will affect manufacturers in the Lehigh Valley. 

“There’s still the same fundamental issues, but with twists to them,” he said. 

Areas of improvement for 2023 should be in supply chain management, he said issues at ports and with transportation have eased and more materials and goods are getting to their destinations. 

Hiring shouldn’t be as big of a challenge, either. 

“At the beginning of [2022] there was a craze in trying to hire,” he said. That drove up wages and led employers to offer a variety of extra bonuses and benefits to attract workers from the limited talent pool. 

“There’s still a hiring press, but not as crazy as it was before,” he said. 

He expects wages to normalize and for employers to be more focused on retention than hiring. 

“How do we retain these people we spent all that money to bring on,” he said. 

Hobbs said he thinks the biggest impact on manufacturing and the regional economy in 2023 will be the reduction in the Corporate Net Income Tax, which begins this year. 

Once among the highest in the nation, the tax will be reduced starting this year from 9.9% to 8.99% as of Jan. 1 of this year and ultimately down to 4.9% by 2031. 

“I think that’s going to be a big attractor to bring manufacturers into the state,” Hobbs said. “It’s the right way to go and it’s the right thing to do. 

During a recent press conference on the tax reduction, Christopher Kuhn, CFO of Olympus of the Americas in Center Valley, said the tax reduction will benefit local operations at his company.  

“We will be able to more aggressively grow our business with both organic and inorganic investments in Pennsylvania,” Kuhn said. 

On the flip side of the tax reduction, interest rate increases are expected to continue. 

The Federal Reserve has indicated that it’s unlikely 2023 will see any interest rate cuts and kept the possibility open that more rate hikes could be coming this year. 

John Hayes, CEO of New Tripoli Bank and member of the PA Bankers Association, said that the higher rates have already put some commercial projects on hold and he expects slowed activity through 2023. 

But he said in some ways that’s a good thing. He said development in the region couldn’t “continue to perform at that level over a long period of time,” and that the slowdown is more of a normalization of development. 

Still, with major movement in food, beverage and pet food manufacturing and many European companies looking to move into the Lehigh Valley, Cunningham said he said he expects, overall, the Lehigh Valley in 2023 will be “full speed ahead toward economic growth.” 

 

Lehigh Valley GDP hits record $47B in 2021

The Lehigh Valley economy is booming according to new data released by the U.S. Bureau of Economic Analysis. 

With manufacturing making up the largest part of the region’s economy in 2021, the region’s Gross Domestic Product soared to a record $47 billion. 

The GDP measures total market value of the goods and services produced in a region over a year. 

With an economic output of $8.4 billion, manufacturing has now overtaken finance, insurance and real estate as the Lehigh Valley’s top contributor to the GDP, according to the Lehigh Valley Economic Development Corp. 

Manufacturing made up 18% of the Lehigh Valley’s private sector output compared to 12% in the nation as a whole last year. 

The GDP of the Lehigh Valley’s top four sectors were still within about $2.5 billion of each other, indicating a balanced and vibrant economy. 

“It seems that each year a new chapter is written on the economic renaissance of the Lehigh Valley,” said Don Cunningham, president & CEO of the LVEDC. “2021 was another record-setting year with the region’s GDP increasing by almost $5 billion and manufacturing taking the top spot as the Lehigh Valley’s largest economic sector.” 

The private sector economic output has recovered from the adjusted figure of $42.5 billion during the first year of the COVID-19 pandemic in 2020. After factoring in inflation, the GDP rose by 6.4% from 2020 to 2021, Cunningham said. 

The Lehigh Valley metro region includes Lehigh, Northampton, Carbon and Warren counties. Lehigh and Northampton County make up $40.6 billion of the metro region’s $47 billion private sector output. 

Cunningham noted that the Lehigh Valley’s private sector output is the 65th largest in the nation and is bigger than the entire states of Alaska, Vermont and Wyoming. 

If the Lehigh Valley were a country, its economy would be the 88th largest in the world, he said. 

Following manufacturing, the largest sectors in the Lehigh Valley’s GDP: 

  • Finance, insurance and real estate ($8.1 billion)
  • Educational services, health care and social assistance ($6.9 billion)
  • Professional and business services ($5.9 billion)
  • Wholesale trade ($3.7 billion)
  • Information ($3 billion)
  • Retail trade ($3 billion)
  • Transportation and warehousing ($2.7 billion)

One sector that had yet to recover from the pandemic was arts, entertainment, recreation, accommodation, and food services. Among the hardest during the pandemic-induced downturn, Cunningham said that sector produced an output of $1.8 billion last year. 

He said the Lehigh Valley’s output has been steadily rising over the last five years, even when accounting for the drop during the pandemic. The Lehigh Valley’s private sector output has increased at a compound annual rate of 1.4% over the last five years.  

 

PA Chamber, local leaders tout Corporate Net Income Tax cuts

PA Chamber President and CEO Luke Bernstein speaks to local leaders at the Lehigh Valley Economic Development Corp. Headquarters in Bethlehem. PHOTO/STACY WESCOE –

The PA Chamber of Commerce was joined by local lawmakers and business leaders at the Lehigh Valley Economic Development Corp. headquarters in Bethlehem Thursday to highlight the benefits of business tax reform in the 2022-2023 budget. 

PA Chamber President and CEO Luke Bernstein spoke during a press conference following a roundtable discussion with the group. 

 “For far too long, Pennsylvania has had the second-highest Corporate Net Income tax rate in the country, which has been a giant stop sign for companies considering moving and investing here,” he said. 

In the new budget the Corporate Net Income Tax, which is currently 9.99 % will be reduced to 8.99% on Jan. 1, 2023, with automatic, annual .50 percentage point reductions until the rate reaches 4.99% in 2031. 

The change will make Pennsylvania the eighth lowest CNI tax in the country. 

Bernstein said one of the best parts of the change was its strong bipartisan support. 

Mike Schlossberg, D-Lehigh, said as a progressive Democrat, he was very proud of his yes vote on the measure. 

“Taxes aren’t bad,” he clarified. “We need them to survive. They’re the price we pay for civilization. But there’s nothing positive or progressive about having the second highest Corporate Net Income Tax in the country.” 

He said by making the cuts, he expects to see future gains as companies invest that savings back into their business and more companies are drawn to Pennsylvania because of the more competitive tax rate. 

Christopher Kuhn, CFO of Olympus of the Americas in Center Valley, said the tax reduction will benefit local operations. 

“We will be able to more aggressively grow our business with both organic and inorganic investments in Pennsylvania,” Kuhn said. 

Don Cunningham, president and CEO of the LVEDC said the lowered rate will help his organization in its mission to recruit new business to the Lehigh Valley. 

“The CNI tax has been a disadvantage for our companies here in the Lehigh Valley and certainly on our work to draw businesses into the region,” he said. “This is a huge game changer.” 

Bernstein noted that the higher CNI rate has cost Pennsylvania business in the past. 

He pointed to Intel Corp., which was considering moving to Pennsylvania, but chose to locate in Ohio instead, which is a state with no CNI tax. 

He said he hopes the tax reduction is just the first step in tax reform efforts to help make Pennsylvania more competitive. 

State Rep. Ryan Mackenzie, R-Berks/Lehigh, agreed that more tax reform is needed. 

“This reduction in Corporate Net Income Tax helps both large and small businesses,” he said. “This will bring meaningful changes for small businesses, but it’s just the first step with more steps moving forward.” 

 

 

Lehigh Valley helps Crayola succeed says CEO at event

Rich Wuerthele, president and CEO of Crayola speaks at the LVEDC Fall Signature Event. PHOTO/SUBMITTED –

Rich Wuerthele, president & CEO of Crayola Inc. In Easton, was the Keynote speaker at the Lehigh Valley Economic Development Corp.’s Fall Signature Event. 

He told the crowd that this past year was the largest in the 119-year history of the company, eclipsing each of the prior two years, which had then also been record years.  

The company’s market share in the United States has never been higher, and international growth is up about 9% over the last three years, and he gave much of the credit for that to the company’s location in the Lehigh Valley. 

He said 70% of Crayola’s products are made at the company’s Forks Township facility, and the company has benefitted from the region’s central location, access to markets, transportation infrastructure, and high-quality talent.

“Quite simply, the Lehigh Valley has been instrumental to our success over our 119-year history,” Wuerthele said. “It’s not only been instrumental in our overarching success, but really critical to the heartbeat of our business, which is manufacturing.” 

The event highlighted the Lehigh Valley’s thriving manufacturing sector – which is now one of the top 50 manufacturing markets in the U.S. with job growth that outpaces the rest of the nation. 

“Lehigh Valley manufacturing is once again a powerhouse and a national story,” said LVEDC President & CEO Don Cunningham. “We still make things here. Just as manufacturing in the Lehigh Valley of yesterday drove the industrial revolution of the last century, Lehigh Valley manufacturing 2.0 serves the new diversified economy of today.”

Lehigh Valley manufacturing job growth outpaces the nation’s

Mack Trucks is a Lehigh Valley manufacturer. PHOTO/SUBMITTED –

Employment in the Lehigh Valley’s outsized manufacturing sector grew at a rate 11 times faster than the nation as a whole in the last five years primarily because the popular products made here helped drive the economic recovery during the pandemic, according to a new Lehigh Valley Economic Development Corp. analysis. 

Home to iconic manufacturers including Mack Trucks and Crayola, the Lehigh Valley realized an annualized net employment gain of 2.2%, or 3,600 manufacturing jobs in total. U.S. manufacturing employment is at 12.7 million, rising by two-tenths of a percent annually in the last five years, according to workforce data analyzed on Chmura Economics’ JobsEQ platform. 

At 35,000 jobs, manufacturing employment in the Lehigh Valley now exceeds what it was before the pandemic and its economic output, at $7.9 billion, ranks among the nation’s 50 largest manufacturing markets. 

The region is a “boomtown” for growth, particularly among beverage manufacturers, because of its ample water supply, sewage infrastructure and location in the heart of the Northeast market, within a four-hour truck drive of 38 million people, said Adrian Ponsen, director of U.S. Industrial Analytics at CoStar, a leading source of real estate data. 

The Lehigh Valley is located “in the middle of the Northeastern U.S.’s Washington D.C. to Boston corridor — the largest cluster of purchasing power in the Western hemisphere,” Ponsen said. “This not only makes the Lehigh Valley an optimal location for distributors, but also for manufacturers who want their production to remain as close to as many of their customers as possible.” 

LVEDC President and CEO Don Cunningham said the data reinforces the message that he’s been sending for years: the Lehigh Valley still makes stuff. 

“Manufacturing has a long and rich history in the Lehigh Valley and remains a cornerstone of the evolving economy,” Cunningham said. “The new data speaks volumes about the resilience of our manufacturers and the economic assets that make the Lehigh Valley a manufacturing powerhouse.” 

The data in the analysis measures manufacturing employment growth in Lehigh and Northampton counties from the first quarter in 2017 to the first quarter in 2022 and is based on a four-quarter moving average, which smooths out seasonal variations. 

The data JobsEQ uses is derived from the Quarterly Census of Employment and Wages, a cooperative program involving the Bureau of Labor Statistics and State Employment Security Agencies. The program serves as “a near census” of monthly employment and quarterly employment and wage data by industry on the national, state and county levels, according to the Pennsylvania Center for Workforce Information and Analysis. 

On the eve of the pandemic, the Lehigh Valley’s economy was expanding as it produced a record Gross Domestic Product topping $44 billion, larger than three states, and manufacturing was fueling that growth. Global employers, such as B. Braun Medical and Coca-Cola, announced significant expansions in the region. 

When COVID-19 disrupted the economy, Lehigh Valley manufacturers adapted to the supply shocks and labor shortages brought on by the pandemic as it worked to supply the nation with medical supplies, food and other essential items. 

By the end of 2020, the Lehigh Valley became the nation’s 49th largest manufacturing market. By the end of 2021, exports had recovered, rising to a record $4.1 billion, according to the U.S Bureau of Economic Analysis. 

Last year, manufacturers completed $221 million worth of development which was linked to 1,000 new jobs in the Lehigh Valley. Another $500 million worth of development, tied to more than 700 jobs, is either under construction or announced. 

Among them is B. Braun Medical, a German-owned life sciences company with its U.S. headquarters in the Lehigh Valley and manufacturing operations. The company is expanding its Allentown plant as part of a $1 billion investment in modernizing and updating U.S. facilities, adding 250 employees to the 2,000 already employed here. 

“The expansion of our Allentown facility reflects B. Braun’s long-time commitment to grow our business in the Lehigh Valley,” said Robert Albert, senior vice president and chief marketing officer. “With its central location, high quality workforce, vibrant communities, and ability to partner with leading healthcare and academic institutions, the Lehigh Valley is an ideal location for a company like ours.” 

Manufacturers value the Lehigh Valley for its affordable location 90 minutes from the financial centers in New York City and within a day’s drive of a third of the U.S. population. Exporters can take tax advantages in the region’s Foreign Trade Zone that LVEDC administers. The Lehigh Valley has a skilled workforce, and the region is growing in population. Educational partnerships are working to keep the talent flowing. 

That has helped stem the fallout from the disruptions caused by COVID-19 and rebound employment quicker than other parts of the country, Cunningham said. 

The Lehigh Valley, which is home to Freshpet and Just Born, outperformed the nation when it came to employment growth among food and pet food manufacturers, an LVEDC target sector, over the last five years. The nation’s employment in the sector grew by an annualized rate of 1%. Food manufacturing in the Lehigh Valley grew at a rate of 7.9% or 1,245 jobs. 

Among the stronger manufacturing employment gains in the Lehigh Valley were in chemical manufacturing, a wide-ranging sector that includes everything from shampoo to vaccine production. Employment in chemical-making grew at an annualized rate of 7.9%, or 1,068 jobs, over the last five years, eclipsing the national rate of 1.5%. 

Some of the local manufacturers working in that space include Piramal Critical Care, which makes inhalation anesthesia products; BioSpectra, which makes pharmaceutical ingredients; A.P. Deauville, which makes personal grooming products, and Evonik, a German specialty chemical company which bought a specialty additive business from Air Products, a Fortune 500 company headquartered in the Lehigh Valley. 

The Lehigh Valley is continuing to show strong signs of manufacturing growth. Last month, Phoenix Tube, a leading manufacturer of stainless-steel products, announced it is expanding its operation in Bethlehem, a move that will result in a new production line and the creation and retention of at least 165 total jobs. 

“While high inflation and uncertainty over the recovery still looms, interest in the Lehigh Valley among manufacturers continues to be strong,” said Kristin Cahayla-Hoffman, vice president of business development and attraction for the LVEDC. 

She said 31 of the 38 prospects the LVEDC was tracking in July were manufacturers. 

 

Lehigh Valley promoted at prestigious foreign investment summit

Kristin Cahayla-Hoffman, LVEDC Vice President of Business Attraction and Development, meets with an international trade representative at the SelectUSA Investment Summit. PHOTO/COURTESY LVEDC –

Lehigh Valley Economic Development Corporation (LVEDC) leaders spent four days highlighting the region’s economic assets to executives, investors, and high-ranking government officials in June at the annual SelectUSA Investment Summit, the nation’s highest profile event dedicated to attracting foreign-owned companies to the United States. 

The event, organized by the U.S. Department of Commerce, provided access to a record 2,000 international participants from 70 countries at the Gaylord National Resort and Conference Center just outside Washington, D.C. The event was also an opportunity to learn the latest trends in the international market from 300 speakers, including U.S. Commerce Secretary Gina Raimondo. 

The conference comes as companies are reconsidering their global footprints amid supply shocks brought to light during COVID-19. 

SelectUSA was a great opportunity for LVEDC to connect with companies from all over the world and explain why the Lehigh Valley is the right place for them to expand their business,” said Kristin Cahayla-Hoffman, LVEDC Vice President of Business Attraction and Development. 

Foreign Direct Investment is an important part of LVEDC’s work because of the family-sustaining wages many of these companies bring. Average wages from foreign-owned companies are typically 14% higher, according to SelectUSA. 

Lehigh Valley’s diverse economy includes a strong portfolio of recognizable foreign-owned companies. German-owned B. Braun Medical has manufacturing facilities and its U.S. headquarters is in the Lehigh Valley. Mack Trucks, owned by Volvo in Sweden, begins the assembly for all its trucks for the North American market in Lower Macungie Township, and Olympus of the Americas, a global medtech leader based in Japan, has its U.S. headquarters in Upper Saucon Township. 

SelectUSA analysis conducted last year shows the Lehigh Valley ranks within the top 10% on the Foreign Direct Investment Attractiveness Index. 

At the conference, Cahayla-Hoffman and Business Attraction and Lending Director Doug Warfel explained why the Lehigh Valley is attractive for foreign investment and fielded questions about the Lehigh Valley from companies particularly in the life sciences, food production and other manufacturing industry sectors. 

The conversations centered on the Lehigh Valley’s attractive location in the heart of the Northeast market, breadth of talent support provided by the region’s educational institutions, the tax benefits of the Foreign Trade Zone that LVEDC administers and the region’s strength in manufacturing. The Lehigh Valley is among the nation’s top 50 manufacturing markets and home to companies that make iconic products like Crayola crayons and Martin Guitars. 

The prospects were also offered swag from Lehigh Valley companies. Mack Trucks donated a box of company-branded items, including the iconic Bulldog hood ornament and collectible trucks to that were raffled to participants. Just Born donated its popular candies: Peanut Chews, Mike and Ike, and Hot Tamales. 

Lehigh Valley companies played a prominent role in conversations at the conference. 

A panel discussion on health care included Robert Albert, senior vice president and chief marketing officer of B. Braun Medical. He was the featured speaker in a discussion about the competitive advantages of the United States. The session examined the select subsectors of the industry and areas of interest for foreign investors. 

Albert noted 80% of B. Braun’s products for the U.S. market are made in the United States, and that the country ranks No. 1 in science and technology, with $245 billion spent on medical and health R&D in 2020. On the eve of the pandemic, the company made the decision to invest in the U.S. market, committing $1 billion to modernize its facilities and bring medical product manufacturing closer to our customers and patients. The decision was made long before the pandemic exposed supply chain issues and prompted conversations about reshoring. 

“With our more than $1 billion of investments in US manufacturing facilities, B. Braun is doing its part to ensure the reliable, long-term supply of vital IV fluids and infusion therapy products that healthcare providers depend on for patient treatment,” Albert said. “The expansion of our Allentown facility reflects B. Braun’s long-time commitment to grow our business in the Lehigh Valley. With its central location, high quality workforce, vibrant communities, and ability to partner with leading healthcare and academic institutions, the Lehigh Valley is an ideal location for a company like ours.” 

The United States ranks as the No. 1 destination for foreign direct investment. In 2019, the latest state data reported by SelectUSA, Pennsylvania had 1.3 million jobs from companies based in the United Kingdom, 898,800 in Germany, 793,400 in France, 587,200 in the Netherlands, and 509,600. Manufacturing accounts for 36% of those jobs, the largest share. 

In 2012, the latest local employment data available, the Lehigh Valley has nearly 24,000 jobs supported by foreign-owned companies, according to SelectUSA. The average salary of workers at foreign-owned companies in the Lehigh Valley then was $55,368. That was $10,500 more than the average of all the region’s companies. 

Lehigh Valley has landed more foreign-owned companies in the last decade. Before the pandemic, LVEDC leaders traveled on international mission trips to England, Germany, France and China to promote and assist companies investing in Lehigh Valley and Pennsylvania. Among the recent successes from those trips was Norac Foods/bakerly, a French maker of baked pasta and frozen desserts that opened a new facility in Forks Township. Fuling, a plastics manufacturer from China, opened its first U.S. manufacturing operation in Bethlehem, and SunOpta of Canada announced its plans to expand its Upper Macungie Township facility. 

LVEDC is tracking more than 80 foreign-owned companies in the two-county region. 

Lehigh Valley economy remains strong despite pandemic impact

Don Cunningham delivers presents the LVEDC annual report. –

The world may still be dealing with the lingering effects of the COVID-19 pandemic, but it hasn’t hurt economic growth in the Lehigh Valley. 

Don Cunningham, president and CEO of the Lehigh Valley Economic Development Corp said in his annual report that the economy was strong in 2021 and the region has experienced nearly full job recovery since the start of the pandemic in March of 2020. 

“The Lehigh Valley economy was not held back by the pandemic,” he said. 

According to Cunningham, part of the success the region has been seeing is because of a dramatic and diverse growth in population. 

In the last ten years, he said the population of the Lehigh Valle has grown 6.2% to 687,508 people, making it one of the top 25 fasting growing regions in the U.S. 

The Lehigh Valley, he said, is also getting younger. The increase in the population of people 18 to 34 grew by 10.7%, which he said has led to a reinvigoration of local industry and has bolstered the need for apartment housing in the urban cores where the younger population prefers to live.  

He noted that developers are leasing apartments as fast as they can build them. 

He also said that while White people are still 70% of the population in the Lehigh Valley the minority population grew by double digits in the last ten years and there was a 46% growth in the Hispanic population alone. There were also nearly 25,000 international immigrations to the region. 

The pandemic also contributed to the population growth as many people sought to leave denser populated areas for places like the Lehigh Valley. There was a 14% increase in people moving to the Lehigh Valley from New York City since 2020, particularly young workers, he said. 

With the influx of people came an influx in industry. 

Cunningham noted there were 50 major expansion or new economic development projects in the Lehigh Valley in 2021, putting the region in the Top 10 of regions of its size for new development and the top region overall in the Northeast. 

“We still make the products the nation consumes,” he said. 

He cited projects from companies including Sharp, Stuffed Puffs, Biomed Sciences and Follett Corp as companies moving to or expanding in the Lehigh Valley in 2021. 

For 2021 the Lehigh Valley had a Gross Domestic Product of $42.9 billion, just slightly lower than the record high in 2019, before the start of the pandemic. 

With 700 manufacturers, Cunningham said the Lehigh Valley is one of the top 50 manufacturing markets in the country. 

And the manufacturing sector continues to grow. The food & beverage industry alone has grown by 60% over the last decade, he said. 

Overall, the top three industries in the Lehigh Valley are finance & real estate, manufacturing and health care. 

The top employers were health care, logistics and manufacturing. 

The employment picture is also strong, he said. 

The unemployment level was a low 4.3% in December 2021, down dramatically from a high of 17% at the height of the pandemic in April 2020. 

Cunningham noted there were 11,900 workers added in 2021, but still the overall number of workers was down as many people chose to leave the workforce. 

That has led to a stronger demand for qualified workers and has driven up wages. 

He said the median household income in the Lehigh Valley was $67,0000 in 2021, compared to the national average of $62,000. 

Looking toward the future, Cunningham said the LVEDC is looking forward to working on its new strategic plan for 2021-2024, which focuses on building on the existing economic foundation and using marketing and the generation of data to grow and develop high value sectors including the life sciences and food and beverage manufacturing. 

Ed Dougherty, chair of the LVEDC board of directors, said that when the organization was formed in 1995, its goal was to promote regionalism to build on economy that was changing from a handful of large manufacturers, like Bethlehem Steel, to a more diverse economy. 

“Regionalism has been exactly the right approach,” he said, and he expects the different cities in the Lehigh Valley will continue to work together with the LVED to continue their mutual growth. 

LVEDC moving to former Bethlehem Club building

520 N. New Street, City of Bethlehem PHOTO/SUBMITTED –

The Lehigh Valley Economic Development Corp. is moving into the former Bethlehem Club on North New Street in Bethlehem. 

The announcement comes after a two-year search for a new  headquarters. The move into the three-story 11,000-square-foot building will allow the LVEDC to be the sole tenant of the building. 

“While several high-quality locations were considered, the new building was the only one that provided LVEDC the opportunity to be a single tenant,” said LVEDC President & CEO Don Cunningham.   “Additionally, like LVEDC’s previous space, its Bethlehem location is ideally central to within the overall Lehigh Valley region.” 

He said that the LVEDC regularly host business leaders and decision-makers who are considering establishing a location in the Lehigh Valley and he believes the new office will provide a great environment to help introduce them to the region. The new building is a larger space with greater opportunities for holding events and functions. 

Cindy McDonnell Feinberg of Feinberg Real Estate Advisors represented the LVEDC in the lease. 

“It was a pleasure to help LVEDC with their very extensive two-year search of the Lehigh Valley,” said Feinberg. “The organization had an opportunity to personally tour fifteen properties and considered numerous lease proposals. At the end of the process, 520 N. New Street in Bethlehem proved to be a perfect new home for the LVEDC.” 

The building is expected to be ready for occupancy in March. 

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