Rezoning Puts the Squeeze on Manufacturing
New York City has lost 37,000 industrial jobs since Bloomberg took office, and, if the next round of rezonings goes through, it will have surrendered 20 percent of its industrial space. So says the Daily News in a story based on the Pratt Center for Community Development’s latest study. The City itself offered opposing statistics—they…
New York City has lost 37,000 industrial jobs since Bloomberg took office, and, if the next round of rezonings goes through, it will have surrendered 20 percent of its industrial space. So says the Daily News in a story based on the Pratt Center for Community Development‘s latest study. The City itself offered opposing statistics—they say the number is 31,000 jobs (still nothing to extoll) and 11,000 square feet of what the story calls “factory-friendly” land. Much of the rezoning was intended to create office space; instead, a lot of former industrial space has turned to residential use, especially in neighborhoods like Red Hook and Greenpoint. The less industrial land there is, the more expensive that land becomes. But the news isn’t all bad, apparently. Though we lost twice the percentage of industrial jobs than the national average, we gained 1,700 last month.
City Industries Feel Squeeze with Rezoning Attracting Developers [NY Daily News]
Sugar. Photo by mezzoblue.
Folks;
Some interesting points raised. My response:
Lurker in the mist: perhaps I’m reading too much into it, but I do think there is some sentiment among some of the Brownstoner crowd for trying to return Brooklyn to some semblance of its industrial past. It is not so obvious in this story, but read the posts on a recent article about the theory that the land that IKEA stands on could have been put to better use as a ship repair facility.
I will concede the point to you and MFS that I am talking about global manufacturers, as this is the world I know. I really can’t say anything intelligent about mom-and-pop manufacturers, as I’ve only dealt with them in a few instances. I do have two questions about them: do they really pay middle-class wages to their workers, and can you really build a substantial economy with them in a city like NYC?
Denton: I have to disagree with you about marketing. I’m not just talking about the relatively simple task of advertising. I’m talking about what it takes to build a brand that means something to consumers. When you see the words Sony or Google, they mean something to you. Compare that to brands that have been allowed to decline, like Zenith, or Magnavox. What do they mean to you today?
I’ve spent 15 years in engineering, 7 years in sales and now 3 years in marketing, and I believe that true marketing is the must sublime of the skills a company can possess. It’s like watching a master play an instrument: it looks easy, but it is not. It is my belief that the Chinese presently do not possess what it takes to build up a brand image. If you want to understand why, I recommend that you read Francis Fukuyama’s book “Trust”. The tile is a clue about the key ingredient that is missing from China today.
mfs,
I bought my granite counters (yes, granite, sorry stoner) from an immigrant stone merchant in the South Bronx. They had beautiful big slabs there and you pointed and bought the one you liked. Not Home Depot.
I think they were illegally located in a residential district, but oh, well, that’s NY. China it ain’t.
The heart of small business in NY is the getting around regulations, not the obeyance of regulations, or the meetings with the planning departmemt to get their gold star. Just make money, you know?
Most of those commenting have little or no interaction with manufacturing companies. Of course Benson’s global company is not going to open a plant in NYC. But plenty of entrepreneurs who here are going to and have, especially those making a locally- oriented product.
Do you enjoy having custom-made cabinets? Stone counter tops cut to fit into your kitchen? Do you eat muffins from a coffee cart? Do you enjoy seeing bands perform on stages outdoors? Almost of these things will happen of within city boundaries.
We’re not talking about Dupont- we’re talking about the companies with 15-25 employees.
I hadn’t even considered that aspect, sam. It’s true and I also have to agree about it being unsustainable. Oh lord- I think I just broke out in a rash when I typed that! :-). As you said- we’ll see, but we do live in interesting times.
One of the reasons that companies have trouble in ny is that their middle managers and junior executives can’t afford to live here. Sure, you can find low-skilled help aplenty in the boros, but frankly, you can find that anywhere. The brains of a business in its supervisory and foremen-level skilled employees, these are positions that pay well, but not well enough to buy a 1.8 million dollar brownstone in need of repair. That is why the NYC picture is so wacked-out comapred to the rest of the country. in most places you don’t have to be a goddam heiress or merchant prince to buy a goddam decrepit old dump of a house. In brooklyn, you have to shell out millions for a house that does not even have a place to park your car. it’s wacked and I think unsustainable. we’ll see.
Hey Benson:
I agree with you for the most part but about Chinese brands I imagine that will happen sooner rather than later. After all marketing is easy, any number of American or international ad agencies will be able to get this done.
I’m sure some will disagree but marketing prowess is far easier than manufacturing prowess. A lot of pretty good stuff coming out of China, including just about everything Apple makes. But who cares, the box says in big letters ‘Designed in California’. Until one day it will say designed in India.
I think Korean brands have only recently come into prominence, Samsung being the only one that people prefer over alternatives. Would you rather drive a Hyundai or a Kia or a BMW? Of course I am aware of the big Korean multi-nationals like Hyundai in shipbuilding and Posco in steel but they’re barely making their way into the consumer vision.
Of course I remember when ‘made in Japan’ was a derogatory term, much worse than ‘made in China’. There are certainly interesting differences btw Japanese and Chinese culture. The Japanese paid their dues to the West and hired Edward Deming, while the Chinese steal as much as they can. The Japanese used to be accused of a failure to innovate, which is no longer true. China can also be accused of the same but they are moving much faster.
I used to collect photographic monographs and that was what turned me on to the de-industrialization of Japan, as you mention. Amazing industrial ruins there! Naoya Hatakeyama is bit one of many fine photographers mining this vein.
One point I’d like to make is the seeming assumption on your part- and correct me if I’m wrong- that these kinds of conversations are held by folk with a romantic hankering for the past, (bring back the farms”?) who waft ethereally though life with nary a clue or thought in their heads. I get impatient with those who would rather shut down a conversation rather than take the opportunity to add a more knowledgeable perspective and insight.
Everyone is impacted by the economy and loss of jobs. Everyone is impacted by the social and economic changes incumbent on this so it’s only natural that everyone has their own opinions. They aren’t invalid opinions either. Just as you judge from your particular vantage point, so do they. I’m a firm believer that there is no universal truth or universal answer for what ails us. While your viewpoint is based on your experience, quite a few others also have both the background and experience that forms their differing opinions. So if you want perspective, you have to be willing to help provide some.
China doesn’t just manufacture cheap toys- it manufactures the parts that are used by all those hi-end industries, including computers, cars, appliances, whatever. They don’t need a brand because their fingers are in everything.
But I’d be interested in your take on small and mid level manufacturing, the kinds of businesses that are often mom and pops. Individually they don’t add up to much, but collectively they do. They’re getting squeezed out, and they can’t go to China. They provide necessary items and jobs, pay taxes. Your analysis seems to overlook them and I find them of much more interest to me than big corporate manufacturers for a variety of reasons.
Lurker in the mist;
I admit to having a certain amount of impatience with some of these discussions because they lack any historical or economic perspective, and rely on trite arguments.
No one doubts that there are negative aspects to any great transformation. I imagine that the transformation from an agricultural to an industrial economy had some bumps in the road, and some real segments of the population got hurt. However, that should not serve as a basis for stopping progress, nor engaging in wishful thinking about bring shipyards back to the East River. How about a movement to “bring back the farms”? I am supportive of programs to retrain people to adapt to transformations in the economy, but that is not what people are talking about here.
Moreover, as I said above, some of these arguments lack any historical or economic perspective. I hardly think that China is an “economic juggernaut” as a simple comparison of their GDP-per-capita with ours will reveal. Taking over the low-hanging fruit of cheap manufacturing labor is hardly an economic coup. In addition,it seems that China does not have the business class that is ready to move up the economic ladder, as the Japanese did years ago. Can anyone on this post name one Chinese Brand that has planted its image firmly in the mind of consumers, as the Japanese and Koream firms had done years ago(and effetively, I might add). The real money these days is in marketing, services, distribution, etc., not in paying slave-like wages to manufacture cheap toys. The US has created whole new economic sectors in the past 20 years. Where is the Chinese, Japanese or European version of Google, E-Bay, Intel, Apple or Microsoft? Answer: they do not exist.
Finally, I can tell you that the de-industrialization that folks lament here is happening on an even grander scale in Japan and Europe, despite (or perhaps because of) their protectionist and xenophobic urges. I go to Japan often to visit the home office for my company, and whole industrial cities are emptying out there, much as cities like Youngstown and Cleveland are doing here.
A little perpective, please.
Prosperity in the United States is becoming more and more concentrated into one demographic. The gap between rich and poor is widening- that’s a fact.
You present a pretty basic bottom line assessment for a large industrial manufacturing company and that’s fine. Can’t argue with anything you said (although you could have been less condescending to Lisa and those who don’t agree with your perspective), your version is not the whole picture and leaves unanswered many questions.
Frankly, no one thinks or even wants to stop the tide of globalization. But in view of the many negative aspects you’re ignoring, it’s hardly a waste of anyone’s time to ask questions or try to come up with solutions. You seem to think the conversation shouldn’t even be held.