In 2021, the City of Kent saw over a dozen businesses open or expand, and only three businesses closed. The city reported its highest tax revenue on record, and the unemployment rate plummeted, Kent Economic Development Director Tom Wilke said in a presentation on the economy to city council on Feb. 2.
In November, Kent reported an unemployment rate of 2.9 percent, the lowest it has been since the city began keeping track.
“I don’t have records that go back [that far], but I’m guessing 2.9 percent is the lowest it has ever been,” Wilke said. “If you look at the city of Kent, unemployment is actually virtually exactly the same as we were the last year before the pandemic.”
Low unemployment is often seen as a crucial marker of economic prosperity. But in the city of Kent, and across Portage County, it marks a challenge: the county’s total workforce is decreasing, and businesses are struggling to fill positions as they grow.
Economic recovery
Across the country, service businesses like retailers and restaurants struggled during the pandemic as large numbers of people felt uncomfortable going out in public to do their shopping.
Some businesses closed, and many had to lay off employees, but officials say the businesses of Portage County largely weathered the storm.
“The business environment has been pretty strong, especially since Covid started, which reflects a positive atmosphere in Portage County,” said Dennis West, economic development director for the City of Ravenna. “Even with the pandemic, as businesses had to lay people off on a short-term basis, or some businesses that were on a smaller scale — typically family-owned businesses, a few have shuttered — but all in all most of the businesses are resilient. They stood the test of time and the pandemic.”
West said that the main goal for Ravenna now is refilling those businesses that closed and providing the infrastructure and commerce that will help continue recovery.
“We are trying to focus mainly on what Ravenna needs to grow,” he said. “We want to attract businesses that are going to be resilient to times like what we have been going through, that will be able to attract the consumer expenditure that is needed in order for the community to grow as a whole.”
In Kent, Wilke said there was a spirit to the people of Kent that lifted up the businesses of Main Street.
“It just shows how resilient these [business owners] are,” Wilke said. “And I talked to a lot of the owners and managers and they attribute a lot of that to so many people in Kent being committed to buying and shopping locally and going to local restaurants whenever they can, so credit to the residents of Kent.”
Burgeoning manufacturing
Brad Ehrhart, director of the Portage County Economic Development Board, said that the first two years of the pandemic were some of the county’s best years for completing development projects since he arrived here in 2011.
The economic development board worked on 13 projects (new or expanding businesses in the county) in 2020, which brought over $124 million of investment to Portage County. Those projects will eventually create 400 jobs with a total annual payroll of $111 million.
In 2021, the county saw 15 projects bring in $47 million in investment.
While these new jobs and income in the area will likely be a boon to the service industry, the projects and direct investment came mostly in the form of heavy industry, manufacturing and distribution.
Ehrhart said many of the county’s manufacturers were well positioned to benefit during Covid-19. He used the example of Berry Plastics, a company that operates two plants on opposite sides of the Aurora-Streetsboro border. Berry produces plastic containers and food wrappers at those plants, and both plants saw demand rise during Covid.
Patrick O’Malia, the economic development director of Streetsboro, reiterated how well the city’s production and manufacturing had done over the last two years.
“The pandemic affected office and service industries dramatically, but a majority of our economic base is manufacturing operations,” O’Malia said in an email. “The lines had to keep humming and, in many cases, actually experienced increased demand, so manpower still had to show up and be physically present. As such, our income tax collections are actually trending upwards, not downwards.”
In that Feb. 2 presentation in Kent, Wilke mentioned that the largest active economic development project in the city was one “nobody ever sees.”
Behind the North Mantua Street headquarters of the Davey Tree Expert Company headquarters, Davey, one of the county’s largest employers, is working on an expansion which will create room for 35 new jobs and $1.8 million in annual income.
“Davey Tree is growing at a very fast pace, and the pandemic has not changed that,” said Jennifer Lennox, Davey Tree director of public relations. “As a service company, we can only grow as fast as we can hire people to support client needs. So we have been hiring, are currently hiring and will continue to hire people. “
Similarly in Ravenna, the largest economic developments are not happening on Main Street, but off the beaten path.
LG Chem America, a subsidiary of the South Korean LG Chem, which is one of the world’s largest chemical companies, is working on a plant in Ravenna Township expected to create 99 jobs and $6.9 million in payroll. Menards also plans to build a distribution and production center in the township that will service Ohio, Pennsylvania and West Virginia. They anticipate the center will create 90 jobs and $4.7 million in payroll, West said.
West said both projects plan to break ground in the spring, and he expects they will bring in an additional $8 million in “indirect investment” to the township and city.
Workforce loss
Despite this investment and growth, all the officials The Portager spoke to agreed that Portage County faces one economic issue that must be tackled.
“The vast majority of our companies are having a tough time [finding workers],” Ehrhart said.
At the start of the pandemic, the total civilian workforce of Portage County dropped substantially.
In March 2020, the total civilian workforce of Portage County was 88,530 people, according to the U.S. Bureau of Labor Statistics. Just one month later, in April 2020, the workforce had dropped by more than 7,000 people to 81,269. Total workforce accounts for everyone in a given area who either has a job or is actively looking for one.
The workforce has since recovered somewhat but is still smaller than it was in March 2020. This means that despite the low unemployment numbers in Portage County, the businesses in the county are short on workers and are having trouble finding new ones.
“Trying to find the workforce for these businesses is a struggle,” West said. “I think that’s the biggest issue right now; why is the workforce such a struggle to find? And we’re trying to figure that answer out. It’s about being creative in seeing how we can bring the workforce here, what is the workforce looking for?”
Although Covid pushed people into early retirement and kept parents out of the workforce, Ehrhart says the issue of job surplus has been around for much longer than the pandemic. As Akron and Cleveland shrunk in the 1980s, Portage County’s population shrunk, too, Ehrhart explained.
“To be honest with you, [workforce] has been the number one issue since the ‘90s in this region,” he said. “It took us quite some time to recover from that change and evolve. We went from very labor intensive processes to very capital intensive processes.”
Ehrhart said the struggle to hire workers has led some business owners to express worries they would have to leave the county. But he believes the market will correct the disparity between job seekers and job openings — which is to say, employers will have to raise wages to fill open spots.
“If you want to hire someone you better pay them $15 an hour, or you aren’t going to have anyone working for you,” Wilke said.
Covid-19 exacerbated Portage County’s labor shortage, but as income taxes increase and manufacturing remains strong, only time will tell if the county will continue its economic recovery.
“I think [it was] pretty clear as we went through this, Covid is still a dominant theme and there’s issues with the workforce in particular,” Wilke said. “There’s still a lot of uncertainty. There’s no predicting the future at this point.”
Owen MacMillan is a reporter with the Collaborative News Lab @ Kent State University, producing local news coverage in partnership with The Portager.