Region mixes old and new to grow economy

Vermont Business Magazine, Aug 01, 2004 by Barna, Ed

The big dark hail cloud in the farm picture this year is a jump in feed prices. As with the milk prices, a number of factors appear to be at work: bad weather and fungus disease that hit the South American soybean crop in 2003; lower American soybean yields in the same year; and an increase in exports.

The expectation was for soy bean oil meal, the main source of protein in dairy cow feed, to cost perhaps $300 per ton this summer, instead of $180 per ton as in 2003. Wellington said one cause lately has been China using its trade surplus earnings to buy feed on the world market.

Made In Vermont

Nice as it is to see labels on food products saying they are of Vermont origin, those concerned with economic strategy would like even more to see manufactured goods coming from the state. In that regard, the past year has seen something of an upturn.

"Things are definitely better," said Jamie Stewart, who as executive director of the Addison County Economic Development Corporation is probably in contact with more manufacturers than anyone else. "They are still not where they were three or four years ago, but they're better than they were a year and a half ago. There's light at the end of the tunnel," he said, but, "it's been a very slowpaced recovery, if that's what we're terming it."

Businesses differ in that regard, Stewart said, with some showing increases in profits of maybe 7 to 10 percent, and others still struggling.

"Natural resources businesses have been the most devastated," he said, such as agricultural and wood products.

Foreign competition is no longer a matter of inferior goods low-balling American quality products, Stewart said. They come into the market competing immediately on quality, he said, partly because American companies have gone overseas to find cheaper production and have taught their suppliers. In some cases, companies are seeing knockoffs of things they designed move in, not cheap imitations but quality substitutes at lower prices.

One response from the regional has been a major effort to put together a Comprehensive Economic Development Strategy, Stewart said. A discussion of that process and product will end this article.

Several manufacturers of major significance to their communities have shown some strength recently. One is Goodrich, formerly BF Goodrich Aerospace and before that Simmonds Precision, which has historically been northern Addison County's largest single employer.

Among other positives, Senator Patrick Leahy has not been shy about calling on his seniority to make sure their strength in the field of integrated monitoring systems for aircraft performance has played a role in the recent military buildup.

In July 2003, their Integrated Mechanical Diagnostics, Health and Usage Management Systems (IMD-HUMS) were chosen for 500 new Navy helicopters. The Fuel & Utility Systems division in Vergennes, was to do both the engineering work and production of IMD-HUMS equipment.

In March, Boeing chose Goodrich's fuel quantity indicating system and fuel management software for their 7E7 Dreamliner, a move expected to bring the Goodrich plants about $100 million, a significant amount of which would come to the one in Vergennes.