In January of this year we welcomed a new member to our Browne & Co. sales team and with manufacturing companies opening up again, it's about time we introduce you to Jeff Terrace!

Just before joining Browne & Co in January 2019, Jeff worked at Hoffmann Group, a German cutting tool, hand tool, workstation and storage solutions manufacturer.

Jeff has been working as an InovaTool representative since February of 2019 and recently joined Browne & Company at the beginning of 2020 as our Cutting Tool Specialist. Please send Jeff and email or give him a call to introduce yourself or pick his brain about an application question.

​(Tribune News Service) — The U.S. Defense Department office that oversees development of the F-35 Lightning II combat jet has awarded project leader Lockheed Martin a $1.9 billion contract to support and sustain the expanding global F-35 fleet through 2020.

by Janet Kavandi - Former Astronaut &  Director of NASA’s Glenn Research Center in Cleveland

CLEVELAND -- Ohio is the aerospace state. Our history is unrivaled by any other state when it comes to achievements in the air and in space. Home to the Wright Brothers. Birthplace of John Glenn and Neil Armstrong. The Buckeye State has produced some 25 astronauts, and their achievements make up a significant part of NASA’s legacy.

That’s why NASA’s Artemis Program is calling on Ohio to make landing humans on the moon by 2024 a reality. Once there, we will quickly and sustainably explore the moon and its resources, and use what we learn to enable our next great endeavor – human exploration of Mars.

(COLUMBUS, Ohio)—Ohio Governor Mike DeWine today announced he will lead a business development mission to Japan in September.

Japan is Ohio’s top international investor, with more than 72,860 Ohioans employed at 852 different Japan-owned establishments across the state. Japan also was Ohio’s fifth largest export market for Ohio products in 2018, when Ohio firms exported more than $1.67 billion worth of products to Japan.

“Ohio and Japan share a special investment relationship, and my administration is committed to strengthening those ties,” said Governor DeWine. “This business development mission looks to find new opportunities for partnership and build upon the successes and ties that have benefitted the people of both Ohio and Japan.” 

Official meetings and events are scheduled from Sept. 8-13, 2019.

In addition to growing relationships with current and prospective company investors, the Governor will seek to create more awareness of Ohio for company representatives, key influencers, and government leaders.

J.P. Nauseef, JobsOhio president and chief investment officer, and Lydia Mihalik, director of the Ohio Development Services Agency, will join the Governor to support the mission.

Anchoring the mission will be Governor DeWine’s visit to the 51st Midwest U.S.-Japan Association (MWJA) annual conference in Tokyo. MWJA is a bilateral organization comprised of the governments of ten U.S. Midwestern states, eight prefectures in Japan, and about 100 Japanese corporations.

This will be the first visit by an Ohio Governor to the MWJA Annual Conference in more than a decade. In addition to the Governor’s delegation, more than 50 government and economic development officials will represent Ohio regions and communities at the conference.

The mission will also include a visit to the Saitama Prefecture, Ohio’s sister state in Japan. Next year marks the 30th anniversary of the Ohio-Saitama sister state relationship. Governor DeWine plans to explore ways to build on the strong ties that have been established with Saitama.

Governor DeWine has been deeply engaged in boosting Ohio investment since the beginning of his administration. On his third day in office, Governor DeWine attended the North American International Auto Show in Detroit, Mich., which included visits with Japanese automakers and suppliers.

In February, Governor DeWine and First Lady Fran DeWine met with Japan's Ambassador to the United States, Shinsuke J. Sugiyama, at the Embassy of Japan during a meeting of the National Governors Association. In June, Governor DeWine took advocacy of Ohio to the SelectUSA Summit in Washington, D.C., where he also met Japanese business leaders and economic development professionals.

Ohio's manufacturing industry is in pretty good shape, a new report found, though the state trails some of its nearby competitors.

In the report from Ball State University, the state received a solid "B," the same grade it earned in the 2018 analysis of the data. The Ball State research measures each state's manufacturing industry in the following areas: logistics industry health; human capital; worker benefit costs; tax climate; expected fiscal liability; global reach; sector diversification; and productivity and innovation.

Only five states received a grade of "A," but four of them are in the Midwest or border Ohio: Indiana, Iowa, Kentucky and Michigan. The fifth state receiving an "A" was South Carolina.

Ohio's best grade within the categories came in logistics, where it earned an "A" for 2019, just as it did in 2018. Its lowest grade was in the worker benefit costs category, though Ohio rose to a "C-" this year from "D" a year ago.

The only category in which Ohio declined was sector diversification, which fell to a "B-" from a "B."
Here are the 2019 grades for Ohio:

• Logistics health: A
• Human capital: C
• Worker benefit costs: C-
• Tax Climate: C
• Expected fiscal liability: C
• Global reach: B
• Sector diversification: B-
• Productivity and innovation: C

Two big Northeast Ohio manufacturing companies, Eaton and Parker Hannifin, are part of this Bloomberg Opinion roundup of prominent developments in the industrial sector.

Bloomberg Opinion's Brook Sutherland writes that Eaton's recently released second-quarter results "did little to endear analysts and investors to its current structure. While the company's aerospace and electrical divisions put up strong numbers despite currency pressures and a more challenging economic environment, the hydraulics and vehicle units were disappointments, yet again. Eaton now estimates organic growth in the hydraulics business will be flat to up 1% for the full year, down from a previous guide of 3% to 4%. Margin expectations for that unit were also slashed. In the vehicle division, Eaton sees as much as an 8% decline in organic sales this year."

Asked by Goldman Sachs Group Inc. analyst Joe Ritchie about the hydraulics unit's long-term fit within Eaton's portfolio, CEO Craig Arnold pointed out that the company's overall performance was solid "despite the fact that we have one of our businesses that's not today firing on all cylinders."

Sutherland concludes, "That's true, and yet while I'm wary of industrial companies' passion for breakups going too far, 'despite' is really the key word in Arnold's comments. This isn't a momentary slip-up for either the hydraulics or the vehicle business, and they're increasingly perceived as more cyclical roadblocks holding up even greater margin improvement and sales growth for the overall company. Arnold has signaled in the past that if the company can't get struggling businesses to targeted profitability levels, that could be a catalyst for divestiture.

The piece also examines Parker's deal to buy Exotic Metals Forming Co. for $1.73 billion.
Via Sutherland:

The name might lead you to believe this company crafts metalworks on some sort of tropical island, but it's based in Washington and makes complex high-temperature engine components and exhaust-management systems for aircraft including the Boeing 737 Max and Lockheed Martin Corp.'s F-35 fighter jet. On the one hand, the addition of Exotic Metals will boost the share of Parker Hannifin's revenue tied to faster-growing, more profitable aerospace products to more than 20% by Bloomberg Intelligence's estimate, which will help to offset the sales slowdown in its industrial-products divisions. At about 13 times 2019 estimated adjusted Ebitda, the Exotic Metals deal is cheaper on that basis than the $3.7 billion acquisition of adhesives and coatings company Lord Corp. that Parker Hannifin announced earlier this year. But this is another debt-fueled bet on the aerospace industry at a time when skepticism is growing about how much longer the multiyear boom in that sector will last.

The conclusion: "Exotic Metals' already-high Ebitda margin of nearly 30% and compound annual sales growth of more than 16% over the last three years leave little room for improvement. A goal of a high single-digit return on invested capital in year five for the Exotic Metals deal isn't terribly impressive to begin with; the risk is, even that is optimistic."

EVENDALE, OH -- The GE9X engine for the Boeing 777X set a new GUINNESS WORLD RECORDS title for thrust to become the most powerful commercial aircraft jet engine (test performance) after reaching 134,300 pounds. This achievement breaks the record held by GE’s GE90-11B engine of 127,900 pounds set in 2002.

The new record-breaking thrust occurred during an engineering test on November 10, 2017 at GE’s outdoor test facility in Peebles, Ohio. GUINNESS WORLD RECORDS acknowledged the feat today at a ceremony at GE Aviation’s Ohio headquarters as part of the company’s 100 year celebration.

“The GE9X engine incorporates the most advanced technologies that GE Aviation has developed during the last decade and is the culmination of our commercial engine portfolio renewal,” said David Joyce, president and chief executive officer of GE Aviation.

“While we didn’t set out to break the thrust GUINNESS WORLD RECORDS title, we are proud of the engine’s performance, which is a testament to our talented employees and partners who design and build outstanding products for our customers.”  

More than 700 GE9X engines are on order with eight customers. The GE9X engine is in the 100,000 pound thrust class and has the largest front fan at 134 inches in diameter with a composite fan case and 16 fourth-generation carbon fiber composite fan blades.

Other key features include: a highly efficient 27:1 pressure-ratio high-pressure compressor; a third-generation low emissions TAPS III combustor; and lightweight and durable ceramic matrix composite (CMC) material in the combustor and turbine. Certification testing of the engine continues and is expected to be complete later this year.

IHI Corporation, Safran Aircraft Engines, Safran Aero Boosters and MTU Aero Engines AG are participants in the GE9X engine program.

GE Aviation, an operating unit of GE (NYSE: GE), is a world-leading provider of jet and turboprop engines, components, integrated digital, avionics, electrical power and mechanical systems for commercial, military, business and general aviation aircraft. GE Aviation has a global service network to support these offerings and is part of the world’s Digital Industrial Company with software-defined machines and solutions that are connected, responsive and predictive.

​GE Aviation is part of a $1.5 billion deal with the Boeing Co. to produce fighter jets for the U.S. Navy.

​A division of General Electric Co., GE Aviation has a facility in Vandalia that makes electric power generations and related systems for military and civilian aircraft. The Vandalia plant will produce parts for the Navy jets, which will support the government of Kuwait.

​The ‘80s futurist John Naisbitt once called manufacturing a “a declining sport,” and to be sure the share of Americans working in factories has fallen far from the 1950 peak of 30% to roughly 8.5% last year.
​
Yet, manufacturing’s contributions to the economy are far out of proportion to its shrinking share of employment. In 2013, the manufacturing sector employed 12 million workers, but generated an additional 17.1 million indirect jobs. It has the largest multiplier of any economic sector: each dollar’s worth of manufactured goods generates $1.40 in output from other sectors of the economy.

Perhaps most important may be the higher wages it provides for blue-collar workers. According to the latest BLS data,  goods-producing industries pays $56,799 a year on average during the latest period in our rankings—much higher than other working-class fields like health care and education (averaging $45,676 annually) and leisure and hospitality ($20,879).

by Chad Moutray
The Bureau of Labor Statistics said that manufacturers added 24,000 workers in April, extending the 22,000 gain seen in March. It was the seventh consecutive month with robust growth in hiring in the sector, averaging 26,571 per month over that time frame.

As such, the latest jobs numbers confirm that the labor market has tightened significantly, with manufacturers increasing employment by a rather robust 19,000 per month on average since the end of 2016. That is quite a turnaround from the sluggish job growth experienced in 2016, and it is a sign that firms have continued to accelerate their hiring as the economic outlook has strengthened and demand and production have improved considerably.

Today’s report is very encouraging. Strong job growth in April shows that economic confidence remains high in the wake of historic, pro-growth tax reform. Moreover, manufacturers continue to invest, raise wages and hire more workers as they expand their businesses and plan for the future. Congress and the president delivered on their promises, and now manufacturers, through our “Keeping Our Promise” campaign, are showing how we are delivering on ours.

Along those lines, average weekly earnings for production and nonsupervisory employees in the manufacturing sector rose from $901.39 in March to $907.78 in April. That translated into a whopping 4.2 percent increase over the past 12 months, up from $871.10 in April 2017, which further illustrates the strength of the labor market right now.

Since the end of the Great Recession, manufacturing employment has risen by 1,202,000 workers, with 12,655,000 employees in the sector in this report. That is the highest level of manufacturing employment since December 2008.

Despite the healthy increase in employment in manufacturing, nonfarm payrolls were up by just 164,000 in April. While this represented an improvement from the gain of 135,000 in March, it was below the consensus estimate of around 190,000.

Meanwhile, the unemployment rate dropped to 3.9 percent in April and continued to be the lowest level since December 2000. In addition, the so-called “real” unemployment rate, which includes discouraged, other “marginally attached” workers, fell from 8.0 percent to 7.8 percent, the lowest level since July 2001.