The future of manufacturing in Baltimore
By MEGAN DAVIS, BEN LAING & JACOB STOLZENBACH
Baltimore Watchdog Staff Writers
What this story covers
Throughout its history, Baltimore has made its mark as a thriving manufacturing city. Now, however, many old factories are empty. Lawmakers, among others, are trying to bring manufacturing jobs back. But the new jobs won’t be like the old ones.
Why it matters
Baltimore has long been a city of makers, but in recent decades that hasn’t been the case. Manufacturing is key to the city’s economic revival.
What was once one of the country’s leading industrial cities is now a cautionary tale of manufacturing’s decline.
Thousands of square feet of empty factory floors are uninhabited along the Jones Falls Expressway and in Sparrows Point. Manufacturing jobs have left Baltimore in droves in recent decades, putting a dent in the local economy and the psyche of a city that prided itself on making things.
Efforts are underway to bring manufacturing jobs back to Baltimore, as training centers and government tax benefits aim to rebuild what was once a major manufacturing hub.
Baltimore’s manufacturing past
With its deep-water port and railroads that link the city to the rest of the country, Baltimore has long had the right location for the import and export of goods needed for a thriving manufacturing industry.
“From the very outset, businesses took off because it was a great natural setting,” said Jack Burkert, the senior museum educator at the Baltimore Museum of Industry.
Manufacturing started in Baltimore with a focus on agricultural supplies. With wheat and tobacco traveling in and out of the port, there was a demand for ship repair. Factories appeared on the water to service the ships as well as utilize them for trade.
One item that became a popular commodity was oysters. During the peak of oyster business, when fishermen would dredge up oysters and deliver them to factories to be canned, about 18 million bushels were sold a year, Burkert said.
The Platt Oyster Co., now occupied by the Baltimore Museum of Industry on Key Highway, sold canned oysters all over the country. After oysters were over-harvested, the city pivoted to another industry, which eventually meant the birth of iron and copper smelting businesses.
At one time, Baltimore had the largest smelting facility in the world, Burkert said. The garment industry also thrived, including factories such as the Henry Sonneborn Corp. It was tallest factory in the city, according to the United States Department of the Interior Heritage Conservation and Recreation Service.
The steel industry picked up as the garment business died down after demand for textiles dropped. Bethlehem Steel claimed the title of the largest steel mill in the world, said Burkert.
Alongside Bethlehem Steel was the creation of the Domino Sugar factory, which sits along the deep water port of the Baltimore Harbor.
“Domino Sugar is in the perfect place,” said Peter O’Malley, the vice president for corporate relations at Domino Sugar. “We can get our ships in from all over the world.”
The Domino Sugar factory was built in 1920. The factory received shipments of raw sugar and used steam-powered machines with direct use of the deep-water port, O’Malley said.
Eventually, this would lead Domino Sugar to become one of the few manufacturing factories to remain.
Cheaper steel from other countries forced Bethlehem Steel to close. Baltimore was eventually left with decaying factories.
Factories were replaced with hotels, and the Inner Harbor became home to restaurants and tourist attractions. Wharfs had been located where the Ritz Carlton is located, and the Key Highway once had railroad tracks that connected factories to the harbor, O’Malley said.
When manufacturing left Baltimore, the jobs left too. More than 17,000 manufacturing jobs left Baltimore between 1947 and 1963. Between 1967 and 1972, 16,000 additional jobs left the city, said historian Kenneth Durr. The city’s share of the region’s manufacturing employment had dropped from 75% in 1954 to 30% in 1995, while its share of the region’s retail sales fell from 50% to 18% in 1992, according to The Baltimore Book.
Baltimore’s manufacturing present
[pullquote]“The aging workforce in place today had the benefit of going through vocational schools and on-the-job training. Those schools went away and now that manufacturing has come back again, including here in Baltimore, there’s nobody there with the skills to fill those jobs.” — Steve Bjorkman, manufacturing jobs expert[/pullquote]
City and state government agencies are attempting to re-establish the manufacturing industry and bring jobs to Baltimore. Factories have been built and have established themselves in the city. One of the next steps is training.
Jane Addams Resource Corporation, a community development organization first started in Chicago, came to Baltimore in 2015. The organization teaches Baltimore residents manufacturing skills such as welding, and computer numerical control, which is coding for machines that weld mechanical parts.
“Our mission is that people who work should not live in poverty,” said Elaine Carroll, the site director for Jane Addams Resource Corporation (JARC) in Baltimore.
Added Steve Bjorkman, the director of manufacturing operations at JARC: “The aging workforce in place today had the benefit of going through vocational schools and on-the-job training. Those schools went away and now that manufacturing has come back again, including here in Baltimore, there’s nobody there with the skills to fill those jobs.”
JARC is focused on training Baltimore residents on manufacturing by utilizing hands-on experiences. The organization owns multiple machines and tools that are set up and available to use at the facility. The machines are set up similar to a manufacturing workplace so that their trainees can receive 500 hours of hands-on experience, said Jerrell Lester, a trainee at JARC.
The center’s programs not only focus on welding and other hands-on skills but also life skills.
“They’ll sit you down and coach you and be like ‘look, it’s bigger than welding here, it’s bigger than CNC, it’s life skills,” said Michael Spencer, a recent trainee from JARC who is now a certified welder. “They’ll put you in the position to win.”
Many who participate in the program are grateful for what they are taught and look forward to work in the future.
“The teachers here are excellent teachers,” Lester said. “They really put their arms around you and grab you in no matter where you fall on the totem pole and they just try to bring you up and allow you to be your best self.”
Baltimore’s manufacturing future
Many states in the U.S. have started incentive programs to address the issue of bringing back manufacturing jobs. Maine, Minnesota and Oklahoma have had early success with such initiatives. Maryland has followed their lead.
Gov. Larry Hogan, flanked by two democrats, then Senate-President Thomas V. Mike Miller and House Speaker Michael Busch, signed a new law to create tax incentives for companies creating jobs in Maryland. The More Jobs for Marylanders Act of 2017 created incentives for companies to expand or relocate to Maryland.
Companies such as Link Gear & Machine Co., Chesapeake Machine Co., and Jumbie Industries are all manufacturing companies based in Baltimore that could be eligible for the incentives program.
“There’s a ton of potential in advanced manufacturing processes, cnc cutting, laser cutting and 3D printing,” said Andy Cook, founder and campaign director of Made in Baltimore. “Not only jobs in the production, but jobs in the programing and maintenance of the machines.”
A qualified job, according to the law, pays at least 120% of the state’s minimum wage, is full time and is filled by an employee for 12 months. Baltimore City is a “tier 1” region that offers the most tax incentives. New companies can also have more incentives if they are new businesses to the state.
“We’re trying to help companies add jobs with incentive programs we have,” said Bill Sorenson, director of regional growth & retention for the Office of Business Development of Maryland Department of Commerce. “So we grow the workforce in Maryland.”
These incentives include refunding companies’ income tax — and the incentives can last for 10 years. The amount of incentives the company is eligible for is directly linked to the amount of jobs created by the company.
“It’s an attractive program for companies,” Sorenson said. “Companies have to meet the hiring requirements before they can take advantage for the tax incentives, so we’re going to see very soon how effective it is.”
Companies have started to relocate to Baltimore, but the extent of job creation remains unclear. The actual numbers of jobs created by the program should be more visible by the end of 2019. These results will give the city government insight into the future of manufacturing and if tax credits are a useful tool for the state to bring back manufacturing companies.
The city of Baltimore is also taking steps to bring back manufacturing jobs. Made in Baltimore is an initiative created by the Baltimore City Office of Sustainability. The program was created to allow Baltimore-based companies an opportunity to showcase their Baltimore roots.
Manufacturing companies that are members of Made in Baltimore include Domino Sugar and Harbor Designs & Manufacturing, a company that designs and manufactures products for other companies. There are also furniture and home goods companies that belong to Made in Baltimore.
“Our core activity is a business certification,” Cook said. “If a business makes or manufactures products in Baltimore City, and once accepted, they can use the logo on their product, packaging and marketing materials.”
Made in Baltimore offers companies a chance to express to customers that products are not only made in America but are made in the city. The program also offers workshops and networking events to help the companies. Workshops can help show companies the process to get more loans.
Made in Baltimore targets local, small companies. Most of these companies have few employees. Some companies, such as JennyJen42, a line of handmade gifts made by Jennifer McBrien, have just one employee. Most of the manufacturing companies do not meet the jobs creation requirement of the More Jobs for Marylander Act, so they cannot take advantage of the tax incentives. The companies may not be big, but they are growing.
“They’re growing at exactly the right pace,” Cook said. “In a way that the companies can manage.”
Experts say that manufacturing in Baltimore in the future will not be massive factories. It will be companies that are smaller than the manufacturing of the past. The days of one company employing thousands of workers manufacturing products are long gone.
The future will be small operations of just a handful of people making things in Baltimore.