It’s time for manufacturing to invest in Appalachia


Recently, another company announced plans to build a facility in Appalachia. KeyState LLC, which is already building Pennsylvania’s first blue hydrogen natural gas plant, plans a second facility somewhere in the Appalachian region[1]. It is not the first company to announce new investments in this strategically important region.

Intel recently announced plans to build America’s first semiconductor factory in a generation. It will be a $20 billion investment near Columbus, Ohio, with the potential for $100 billion in expansion. Nucor Corporation announced a $2.7 billion investment in a new sheet metal plant in West Virginia, and Sherwin-Williams announced it would invest $324 million in Statesville, North Carolina, to significantly expand its manufacturing capacity and building a new distribution center and fleet transportation.

But why are some reluctant to invest? Most likely, they are waiting for a return to normal.

The harsh truth is that we will not return to an old normal and our industry cannot afford to wait for a new normal. It’s here, and it’s not playing well. The sooner we recognize it, adapt to it and move on, the sooner we will begin to see success in it.

Challenges and crises are not new to our businesses, our nation or the world. Companies have always had to evolve and surpass themselves. Now we must do so with a growing sense of urgency in the face of ambiguity. We must look to the future to adequately prepare for 2025, 2030 and beyond, regardless of the scale of the current crisis we face together.

What do we do with what we have learned over the past two years? How does it inform our thinking and strategic decision-making? We cannot be paralyzed by the fear of uncertainty and the unpredictability of times. Rather, it is the perfect time to be inspired by the future we can create. Opportunities abound for our operations and expansions to benefit our businesses and the communities where we choose to do business.

Barely a decade ago, big decisions were made that are now taking shape. Shell’s ethane cracker, just outside Pittsburgh, is working to a safe start. These are big decisions made as early as 2012 and even before, at a time when the world was just beginning to feel “normal” again after the Great Recession.

These places were not chosen at random. These were daring games based on meticulously calculated investment decisions, born out of fantastic innovation work. Such decisions have the power to revitalize and strengthen areas that once powered the nation but have suffered the most from economic setbacks. These locations made a lot of sense more than a decade ago, and this scouting strategy has made them long-term plans for companies leaning forward in the saddle.

The Appalachian region in particular is ripe for investment. The workforce is well trained by vocational schools and special education programs. And we’re loyal – West Virginia, for example, has the lowest turnover rate in the United States. Appalachia is conveniently located within a day or two of the majority of the US population and is less susceptible to disasters like tornadoes and hurricanes. The cost of living is low and the region is rich in resources.

Investments like this are made possible by decades of exceptional performance. And not just financial performance. These investments are made possible by strong business fundamentals, diversity of thought, by generating customer and market demand, and by innovating. And, as everyone in our industry knows, outstanding safety performance and environmental protection are the fundamental enablers.

Still not sure?

Look at the data. In addition to geographic and labor advantages, conduct benchmarking research, set new goals, and measure progress against those goals. At MATRIC, we are working to implement advanced use of artificial intelligence in the trading market to find predictive indicators and prescriptive actions based on all of the data analytics from our Morgantown business unit , West Virginia Advanced Systems Technology.

It is imperative that manufacturers predict trends in advance to position their businesses and innovations in the right place, at the right time, even before the rest of the market realizes that they are maneuvering. Think about the workforce pipeline and examine areas for expansion with training opportunities aligned with your hiring needs.

Contact your local and national representatives to discuss the business climate in your area and local policy options such as tax incentives and funding opportunities. Most local governments are part of the economic development fabric of their region and seek contributions and partnerships with local business leaders.

Solving problems, becoming safer and more environmentally friendly and being profitable at the same time is a complex undertaking. The “new normal” is what we make of it. Now is the time for confidence, boldness and the next big decisions to move our industry and our country forward for the next decade and beyond. And Appalachia is the perfect place to do it. At MATRIC, we’ve made our own bold decisions for the future here, and we invite you to join us.

Steve Hedrick is Chairman, President and CEO of the Mid-Atlantic Technology-Research & Innovation Center, which supports the chemical, energy, environmental and advanced software sectors.


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