Business

Tri-City Made: Manufacturing critical to current, future Tri-Cities economic health

• Editor’s note: This is the first in an occasional series on manufacturing in the Tri-Cities.

Circuit boards, cancer treatments, nuclear fuel, rifle scopes and mammoth cranes don’t seem to have much in common.

But in the Tri-Cities, they do. Those are all products area manufacturers make and sell to companies around the world.

The Tri-Cities has a healthy, growing manufacturing industry that accounts for about 7 percent of all area jobs and wages. But this critical piece of the economy is somewhat hidden, overshadowed by Hanford.

Manufacturing is the part of the economy that local officials hope to continue to grow as the Tri-Cities works to better prepare for the eventual end to Hanford cleanup activities.

But what we have already is more diverse than many realize. The Tri-Cities is home to quite a few food and beverage manufacturers, but local companies make so much more than french fries and wine.

For example, Areva’s Richland plant produces nuclear fuel that supplies about 5 percent of U.S. electricity. The company sells the fuel to nuclear power plant operators.

About 1,000 national and international cancer patients a year receive direct radiation treatment from seeds containing the radioactive isotope Cesium-131 made by Richland’s IsoRay Medical. A single titanium seed is the length of a piece of rice and thin as pencil lead.

And Kennewick’s Manufacturing Services builds circuit boards for companies that manufacture medical, military, wireless communications and other products.

“No matter what we do, we need manufacturing, and we can either pay someone else to do it, or do it ourselves,” said Patric Sazama, Impact Washington’s regional project director for Eastern Washington.

Jobs tend to pay better

The Tri-Cities has seen manufacturing grow overall during the last two decades. New companies have opened up shop, outside companies have moved in and existing companies have expanded.

Take Pasco-based TiLite, a custom manual wheelchair manufacturer. It has grown from 15 to more than 230 employees and expanded from the Port of Kennewick’s Oak Street Industrial Park to its own manufacturing facility in the last 18 years.

TiLite made more than 15,000 customized manual wheelchairs for U.S. and international customers last year. The company, which was sold to Swedish power wheelchair manufacturer Permobil last year, plans to continue to grow.

And they aren’t the only ones.

Overall, the average number of Tri-City manufacturing jobs has gone from about 5,000 in 1993 to more than 7,300 in 2013, according to data from the state Employment Security Department.

Food and beverage manufacturing dominate, at an average of 3,750 food manufacturing jobs and 1,300 beverage manufacturing jobs in 2013.

Tri-Citians also work in fabricated metal, machinery, electronics, chemical, wood and other types of manufacturing.

Total manufacturing wages increased each year during the last eight years. That happened despite the recession and layoffs with the closures of J.R. Simplot Co.’s Pasco plant in 2008, Prosser’s ConAgra Foods Lamb Weston plant in 2010, and Parsons Technology Development and Fabrication Complex in Pasco in 2012.

Tri-Citians working in manufacturing earned about $338.3 million in 2013, up 3 percent from the previous year.

An average Tri-City manufacturing worker earned $46,100 a year in 2013, about $1,000 more than the average Tri-City worker for all industries.

Advances in technology and automation mean that fewer people are needed to do the same amount of work, but those jobs tend to pay better because they require more skill.

Ripple effect through the economy

The Tri-Cities may already have a strong industrial base, but local leaders want more.

Kennewick’s efforts to expand the city’s urban growth area south of Interstate 82 and west of Highway 395 stem from a desire to have more industrial land to offer to large manufacturers.

Local efforts to get some of Hanford’s land for economic development also aim to bring in manufacturers in the energy sector.

The Tri-Cities Research District in north Richland is home to some manufacturers already and aims for even more.

Economic development efforts have historically focused on manufacturing, since the jobs tend to pay better and it’s a way to keep outside money flowing into the community, said Gary Ballew, the Port of Pasco’s director of economic development and marketing. Manufacturers are selling their goods and services around the nation and world.

But it’s also something communities can impact, he said. Manufacturers that are growing tend to look for expansion opportunities, and savvy communities can market themselves to bring that business in.

Manufacturers have a ripple effect through the local economy because of their need for supplies, which can create business for other area companies, Sazama said. They also help support a need for more retail and service industry jobs.

Manufacturing also can bring in tourists. Wineries are a good example, but people also will visit food manufacturers, especially if they can get a sneak peek into the process, said Gary White, the Tri-City Development Council’s director of business retention and expansion.

Manufacturing is where future jobs are at, especially those in science, technology, engineering and mathematics, or STEM, fields, Ballew said. There aren’t enough of those skilled workers.

A huge investment

While the desire is there, recruiting manufacturers is a tough task. It takes a lot of time to see a project come to fruition.

“It’s a huge investment for a manufacturer to build in a new community,” said Terry Walsh, Kennewick’s executive director of employee and community relations.

For example, attracting food processors to the Pasco Processing Center took a lot of time, Ballew said. The Port of Pasco sold the last large piece of land in the 250-acre park off Highway 395 just last year, about 20 years after the center’s first business opened.

For now, TRIDEC is honing in on trying to market the Tri-Cities as a hub for food and beverage manufacturers, focusing on the region’s strengths.

White is preaching the “Columbia Basin gospel” as being the place to be for food and beverage manufacturers. The Tri-Cities already has a cluster of such manufacturers and the infrastructure to support them, he said.

But that doesn’t lessen community leaders’ desires to see other types of manufacturers move to and grow in the Tri-Cities.

The Tri-Cities does have some advantages local officials sing as they try to draw in new companies.

Available land at reasonable prices, low power costs and highly skilled workers rank high on that list, said Diahann Howard, the Port of Benton’s director of economic development and governmental affairs. The cost of doing business and cost of living for workers also is low.

The Tri-Cities is easy to access by water, rail and highways, she said. It’s also close to Portland, Spokane and Seattle.

And companies also have a chance to partner with Pacific Northwest National Laboratory and Washington State University Tri-Cities, Howard said. That’s key since manufacturing also is a path to developing new technologies.

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