Baltimore Sun

Retooling for a new reality

Baltimore County's traditional manufacturers have been replaced by smaller, technology-focused firms. At Maryland Thermoform Corp., Suchat Scribunjerd operates a machine that makes moldings for the company's specialty plastics products.
When John Thornton came to Baltimore from Oxford, N.C., in 1956 to visit an uncle, he didn't expect to stay.

But 47 years later, the retired steelmaker is like many who put down roots here.

Shortly after arriving, Thornton found work at a restaurant on the grounds of Bethlehem Steel Corp. at Sparrow's Point, settled in Turner's Station, an African-American community in Dundalk, and married.

He retired in 1991 at age 62, having raised five children in the rowhome his job as a steelmaker afforded him on a quiet, tree-lined street in Turner's.

Thornton's life story is so common as to be almost cliché in Baltimore County. But for many, the story has changed. Once a national leader in manufacturing, Baltimore County now is leading the way in retreat.

And as the employment environment changes with this trend, the county's workers are adapting. Those working for large, long-established manufacturers now must accept a more competitive job market and less job security than in the past. Others are moving to newer, smaller higher-tech firms that some say represent the future of manufacturing.

Even still, workers in very large numbers are moving into the county's lower-paying retail and service sectors, where the job opportunities are more widely known.

"The county had a huge industrial base and the Baltimore region did," said Dunbar Brooks, chairman of the Turner's Station Development Corp. from 1980 to 2000. The longtime resident is manager of data development for the Baltimore Metropolitan Council.

"Many of those manufacturing jobs have either disappeared, gone overseas or have automated, computerized -- and therefore don't need as many people," Brooks said. "That meant people had to then switch over.

"The economy is changing everybody, basically -- countywide, statewide, in essence, nationwide."

A bustling economy

In its heyday, during World War II, Baltimore County was bustling with manufacturing activity.

The Glenn L. Martin Aircraft Co. employed 53,000 people in Middle River. Western Electric Co. had 9,000 workers at Point Breeze. Bethlehem Steel -- the nation's top war contractor a month after the Japanese attacked Pearl Harbor in 1941 -- peaked at 35,000 employees in 1959; 6,000 worked at the company's affiliates that year, including its shipyard.

Other major contributors to the county's labor force in the late 1950s included Aircraft Armaments Inc. (900 employees), Black & Decker Corp. (2,700), Westinghouse Electric Corp. (1,200), Kaiser Aluminum Corp. (1,000) and Bendix Radio Corp. (more than 2,000).

In 1960, the total number of manufacturing workers in Baltimore County totaled nearly 66,000.

By 1990, this number had shrunk to slightly more than 47,000 -- and the slide continued over the next decade, to a little more than 34,000 jobs in 2000, according to the Maryland Department of Labor, Licensing and Regulation. The county's 28 percent job loss in its manufacturing sector mirrored the industry's loss statewide. Maryland's manufacturing employment decreased by 34.1 percent over the period. By contrast, the share of the county's jobs in the lower-paying services sector increased to 32.4 percent, from 26.1 percent.

David S. Iannucci, Baltimore County's executive director of economic development, views the numbers this way:

"Manufacturing represents 14 percent of the economy nationwide," Iannucci said. "In Maryland, it's 7 percent. Baltimore County, about 9 percent. Given what's happening internationally, with the tremendous, unprecedented growth of China as a manufacturing sector with a far lower cost basis, it must be assumed that manufacturing in the United States overall will face incredible competitive pressure."

For many, fairly or not, Beth Steel's bankruptcy in 2001 and its subsequent sale to International Steel Group Inc. in April have become shorthand: a measure of the health of the county's entire manufacturing sector and a symbol of its status in this worldwide industry.

"I had a pension from the Point," said Thornton, who went to work for James A. Morton & Sons Funeral Home Inc. after retiring from Beth Steel. "When they filed for bankruptcy, they dropped us. They wiped out the health insurance." He's now on Medicare.

Problem for youth

Brooks, who still volunteers with Turner's Station Development Corp., sees a problem for youth in his community who are looking for employment near home.

"If you look at the major employment in Dundalk, it's retail," he said. "There are actually more jobs on Merritt Boulevard and at Eastpoint Mall than there are at Beth Steel. And retail jobs, while decent employment, don't pay a lot of money."

Brooks teaches an introductory course in computers part time at the Community College of Baltimore County-Dundalk.

"I've taught there for almost 20 years," he said. "And, certainly, I've had people from Turner's who come to the college to try to upgrade their skills.

"There are young people who are very diligent, who have gone to college, who have finished high school, who are out working," Brooks said. "They do have hope. There are others who have either dropped out of school or who have dropped out of life."

Only two of John Thornton's five children have jobs tied to the manufacturing sector: His stepson, Vernon Banks, lives in Northwood in Baltimore City and works in Dundalk for Baltimore Marine Industries, formerly BethShip, a Beth Steel subsidiary. BMI recently filed for bankruptcy protection.

Another stepson, Kenneth Banks, lives and works in the city. He is an assembler at a small factory.

Meanwhile, Thornton's daughter, Stephanie Moore, lives in Dundalk and works in administration at Franklin Square Hospital. A stepdaughter, Johnna Banks, his youngest, lives with him and works at a Wendy's International Inc. franchise.

His eldest daughter, Elva Margaret Davis, lives near Thornton in Turner's Station. She is unemployed.

Thornton says he is looking into getting health insurance for his dependents. He knows he will have to pay out of pocket.

'Going downhill'

Vernon Banks left Turner's Station for the city four years ago. His job in BMI's service department has enabled him to raise three daughters, now in their 20s.

Erica, his youngest, is a manager at Sears, Roebuck & Co. Danielle is a student and works at a local day-care center. Monique, the eldest, is a homemaker.

Banks, 48, began working for BethShip right out of Dundalk High School in 1967 and now has six years with the company in its new incarnation.

"When I first got hired with Beth, oh, it was fantastic," Banks said. "We were making money hand-over-fist. With [BMI], we took a lot of concessions: cuts in pay, benefits; profit-sharing never did materialize.

"Since this company has taken over, we've had a lot of layoffs," Banks continued. "In the six years I've been with this company, I don't think I've averaged a complete six months. I mean, it's broken -- like two months here, a month and a half here, three months here.

"But even before that, with BethShip, we had started getting [furloughed] two or three times per year. To me, it seemed like it was going downhill."

Still, Banks said, he's made a decent living. He can only hope that his children one day will earn the kind of money he has.

"To me, the opportunities are there for them right now," he said. "All they have to do is go and apply themselves."

But Banks doesn't see those opportunities in manufacturing.

"A future there? I don't see it," he said. "My company is in federal court right now for bankruptcy, as we speak. Now, I'm kind of stuck. I don't know whether to go start all over.

"Is there a future for this job?" he asked. "But I know the last time, when BethShip was in trouble, the federal government stepped in and got us government contracts. And now, the bulk of our work is naval vessels. So I'm hoping the federal government may step in and bail us out again."

Need for skilled workers

Is Baltimore County's manufacturing sector truly dead?

"I think 'evolving' is a much better word," said Iannucci, the economic development director. "What happened to Bethlehem Steel is what was happening to the steel industry in general, nationally and internationally.

"There's no particular message to be written about Baltimore County from that experience," he said. "There is a human tragedy in Bethlehem Steel, in that a thousand men and women are likely to have lost their jobs in the next couple of months.

"Manufacturing is changing from the old industrial model that perhaps Bethlehem Steel represents more than anybody on the east side of Baltimore County, " Iannucci said. "Yet, technology has put a new face on manufacturing."

He cited General Motors Corp.'s Allison transmission plant in White Marsh and ISG, with its cold roll steel mill at Sparrows Point, as examples of new, technology-based operations.

He also noted BD Bioscience Inc., "which is manufacturing in the most modern sense of the word -- biotechnology products."

Iannucci also cited the findings of a report by the Maryland Advisory Commission on Manufacturing Competitiveness released in December, when he was still Secretary of the Maryland Department of Business and Economic Development.

"[The Commission] talked to more than 100 manufacturers around the state and asked them key questions about what was important to them," he said. "And the Number One answer, and this applies to Baltimore County, was finding qualified employees.

"So the work-force issues are crucial," he added. "Employees are going to need to be sophisticated and have the most advanced skills to be employable. And that's where some of Baltimore County's focus is important -- everything from Sollers Point [Technical High School] to Eastern Technical High School, programs that are very much focused on helping produce workers the manufacturing sector would need."

Training future workers

A half-block from John Thornton's home in Turner's Station, Ed Fangman, principal of Sollers Point, works to train students for Baltimore County's changing work force.

Sollers Point, a regional magnet school, has Baltimore County Public Schools' only manufacturing programs, which educate about 60 of the school's 850 students in industrial technology, high-performance manufacturing and Cisco Systems Inc. computer networking. Sollers Point is also the only ISO-certified school in the state.

Fangman said employment opportunities in manufacturing remain underappreciated in the county.

"Living where we live in the southeast area of Baltimore County, there is an awful lot of traditional manufacturing and now more high-tech and high-performance manufacturing," Fangman said. "My predecessor, Ed Parker, felt -- and I agree -- that it was important that we address the needs of the community.

"Kids only know what they're told -- by their parents, their teachers, their uncles and aunts," he added. "The situation at Beth Steel, the massive layoffs at Western Electric, the cutbacks at GM have created the impression that there are not jobs in those industries.

"Nothing could be further from the truth, in my estimation," Fangman said. "There are jobs in those industries: They're not 30,000; they're 3,000. But the point is, the folks in those industries, they're aging. And so you have to have that replacement flow.

"The huge companies are the ones we hear about," he said. "You don't hear about Ward Machinery or Maryland Thermoform or Kenlee Precision, which are smaller shops, but still in need of employees.

"If I graduate 20 kids a year in manufacturing, I believe they can find jobs," Fangman said. "But businesses have to know I've got the pipeline open."

Smaller firms better-positioned

Scott MacDonald is chief executive of Maryland Thermoform Corp., a custom plastic products and packaging manufacturer with 70 employees. The company, one of Sollers Point's "business partners," moved from Towson in 1998 and now is located in Crossroads Industrial Park in Baltimore City.

The neighborhood where the industrial park now stands, Pigtown, was a thriving center of the slaughterhouse industry a century ago. Photos from the era decorate Maryland Thermoform's walls.

MacDonald and his partner, Jim Hall, bought and reorganized the company in 1994 with venture capital money and have made it a success, so far, by investing heavily in new technology.

"The biggest problem we have here is getting skilled help," MacDonald said. "The school system here locally does not supply you with the kind of person who can just walk onto the floor and start working.

"We're completely vertically integrated," he explained. "We do everything from concept to packaging to pushing it out the door. So we use people who are completely unskilled, which is probably 25 percent to 30 percent of our labor, to people who are very highly skilled with a computer.

"Even with so many people out of work, there still are not people who are at the front door with skills we can use," MacDonald said.

MacDonald said small companies like Maryland Thermoform are in a better position to compete with manufacturers outside the U.S., but he does not see companies like his being able to fill the gap left by such heavy hitters as Beth Steel.

"There would have to be a federal change in policy -- read that as protection, someway, somehow, to prevent the deindustrialization of the United States," MacDonald said. "Small companies are probably in a better position to survive in this environment. We can move faster. We don't have to go to corporate. We can get together in a meeting; we can make changes very quickly.

"The big guys are looking out for the low-wage dollar: China, anywhere from 50 cents a day to $3.50 a day. Mexico, the average wage is $3.50 an hour. Now, we can compete with faster, better equipment for $3.50 an hour. You can't [compete] with $3.50 a day or 50 cents a day.

"The fastest equipment, best technology in the world isn't going to off-balance it if it's a highly labor-intensive product," MacDonald said.

"Filling the gap? No," he continued. "We can help. It would take a tremendous change in not only federal government but also in the way the state nurtures small companies for us to fill it."

Major policy changes on the federal level in recent years -- including the implementation of the North Atlantic Free-Trade Agreement with Canada and Mexico in 1994 -- as well as the establishment of the World Trade Organization in 1995 have opened up markets to far greater foreign competition, trending away from the protections MacDonald supports.

Bankruptcy raises concerns

Eric Schindler Jr., 20, graduated from Sollers Point in 2001. He completed the industrial technology program. Schindler lives with his parents in the Eastfield-Stanbrook community in Dundalk and works as an iron-making maintenance tech at International Steel Group.

Following in his father's footsteps by working at Sparrow's Point has been a childhood dream. He remembers being fascinated by a foldout his father once brought home that illustrated the steelmaking process.

"My dad worked for Beth Steel for 27 or 28 years," Schindler said. "That's what I wanted to do. I wanted to go work at the Point with my dad. He would say: 'Aw you don't want to do that! You don't want to work there! Do something else.' "

"But I can't stand a desk job," the younger Schindler said. "I'd rather be outside in the elements in the heat and the cold. I like working with my hands. I couldn't stand working on a computer all day."

Schindler is happy with his job for now, he said, but the Beth Steel bankruptcy and sale have raised concerns. The union he belongs to, Local 9477 of the United Steelworkers of America, has advocated vigorously for ISG workers in wage and benefit negotiations.

He estimates the union enjoys about 90 percent support among the plant's workers.

"I make very good money for a person my age," Schindler said. "I make probably three times what the average person my age makes, even out of college. People have to go through four years of college, they get out, they get a $30,000 a year job -- and then they have to pay off their loans.

"Working [at ISG], they'll send me to school," he said. "People get their bachelor's degrees, [associate's] degrees. I thought about doing it, but I kind of want to work as much as I can, to make as much money as I can, in case the bottom falls out.

"I kind of knew what I was getting myself into," Schindler added. "I didn't think it would happen as fast as it did. I started there in July of 2001, and by October of 2001, they were in Chapter 11. But from what my father and some other people have told me, it goes downhill -- and then it goes back up."

Schindler feels fortunate.

"Most of the kids I went to school with that I knew either work around here part time or do whatever's out there: McDonald's, some work at Sears, J.C. Penney, in the malls," he said. "A lot are going to college, and some went into the military."

Aspiring for better jobs

"Kids basically aspire to the jobs that they see," said Dunbar Brooks of the Baltimore Metropolitan Council. "They can aspire for greater than that. We want to prepare them for any type of employment, not just the lower-wage retail and service jobs they see in their community. We should make them more aware of the jobs that are available in our economy today.

"We need to help our young people to know how our economy works," Brooks said. "That's part of the job of education. Community colleges are geared toward that kind of thing. But when you look at the ratio of kids to guidance counselors in the high schools, it's a wonder any guidance ever gets done."

Brooks said some high-paying jobs are available for those who don't go to college.

"There are trade jobs," he said. "We have companies stealing machinists from each other, because there's such a shortage.

"Manufacturing jobs have not disappeared entirely," Brooks said. "Part of the problem is people think of the old Beth Steel model -- smokestacks. When you look at manufacturing today, those are clean, high-paying, high-tech jobs. We have to get out good information."