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BusINess » BusINess Story of the Week

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Economic recovery slow to emerge

(Photograph by Tony V. Martin/The Times.)

(Photograph by Tony V. Martin/The Times.)

“We didn’t get into this economic crisis overnight. We won’t get out of it overnight.”

David Bochnowski pulls no punches when discussions turn to the local, state and national economic situations.

“Community banks, traditional bankers in communities across the country, did not engage in the practices that caused the meltdown of our financial system,” says the chairman and CEO of Northwest Indiana Bancorp and Peoples Bank. “That was caused by the practices of unregulated mortgage originators and mortgage brokers.”

The consequence of this upheaval is the deepest, longest-lasting recession in American history, he says.

“This is taking much longer, and we haven’t seen the rapid recovery of other recessions of the past, particularly those of the 1980s, when we emerged stronger,” Bochnowski says, adding that changes will come slowly if current circumstances are any indication.

During his recently-completed tenure as chairman of the government relations committee of the American Bankers Association, Bochnowski had a unique perspective on the recession and how the federal government is handling it.
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Auto industry’s return to ‘normal’ boosts steel

A Chicago Assembly Plant employee works on the assembly line. A bevy of challenges remain in the auto and steel industries as lower operating rates, high unemployment and reduced levels of consumer demand are expected to temper short-term performance expectations. (Photograph by The Times.)

A Chicago Assembly Plant employee works on the assembly line. A bevy of challenges remain in the auto and steel industries as lower operating rates, high unemployment and reduced levels of consumer demand are expected to temper short-term performance expectations. (Photograph by The Times.)

Improvements in the domestic auto industry will be a key driver to the economic recovery for steel production, analysts and company executives said.

However, a bevy of challenges remain in both industries as lower operating rates, high unemployment and reduced levels of consumer demand are expected to temper short-term performance expectations.

At a steel conference in Chicago earlier this month, Kim Korth, president of auto research firm IRN, said the recent recession seemed worse than prior ones because the automotive industry sustained a lot of damage in a short time. The 43 percent drop in overall light-duty vehicle production between 2007 and 2009 happened in half the time than the last precipitous decline in the late 1970s and early 1980s, according to IRN’s data.
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Community leaders discuss support for GRIP, NWI revitalization efforts

Ron Sims, deputy secretary of the U.S. Department of Housing and Urban Development, sits on a panel Wednesday morning to discuss federal priorities in development and renewal at the Genesis Convention Center in Gary. The discussion was part of the daylong meeting of the Gary and Region Investment Project, or GRIP. (Photograph by The Times.)

Ron Sims, deputy secretary of the U.S. Department of Housing and Urban Development, sits on a panel Wednesday morning to discuss federal priorities in development and renewal at the Genesis Convention Center in Gary. The discussion was part of the daylong meeting of the Gary and Region Investment Project, or GRIP. (Photograph by The Times.)

To sustain Northwest Indiana’s viability, all hands have been called on deck.

In the launch of a regional collaborative effort Wednesday, about 200 business and community leaders, local and national development officials and legislators discussed strategies on supporting projects that can maintain communities and revitalize the area’s urban core.

Attendees of the daylong meeting of the Gary and Region Investment Project, or GRIP, also helped give input on which efforts can create long-term growth in the area.
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From recession to recovery

U.S. Steel Gary Works, along Lake Michigan's southern shore, is the company's largest plant, churning out more than 7 million tons of steel a year. Officials say the recession, which sent automobile sales and steel production tumbling, forced region manufactures to become more adroit.

U.S. Steel Gary Works, along Lake Michigan's southern shore, is the company's largest plant, churning out more than 7 million tons of steel a year. Officials say the recession, which sent automobile sales and steel production tumbling, forced region manufactures to become more adroit.

Eileen Chmielewski, of Crown Point, said Oct. 2, 2008, was the worst day of her life. She lost her job working for an insurance company in Chicago.

More than two years later, she continues to struggle making ends meet as she is only employed part time in Northwest Indiana, netting a fraction of her former full-time pay. While she’s thankful for her job, the recession brought economic pain that was difficult for her and her two children to foresee.

“Who wants to be in this position? Nobody. Nobody,” Chmielewski said. “We do what we have to do. I never thought I’d be let go. . . . it’s devastating.”
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Wind turbine components part of recovery at Port

Wind turbine fan blades sit in the Port of Indiana Burns Harbor before being shipped out. (Photograph by The Times.)

Wind turbine fan blades sit in the Port of Indiana Burns Harbor before being shipped out. (Photograph by The Times.)

Green energy is creating a boon for the Port of Indiana Burns Harbor as it handles a large set of shipments this season—components for an Illinois wind turbine development.

Jody Peacock, spokesman for the Ports of Indiana, said the shipments have been taking place over the past few months. Most of the equipment is being removed from ships and transferred to trucks or railcars destined for Illinois. Some is being staged at the port for future shipment.

The majority of equipment such as turbine blades and steel tubes for turbine towers will be heading to Chicago-based Invenergy LLC’s White Oak wind energy development in McLean County, Ill. The development is expected to generate 150 megawatts of electricity and is expected to go online next summer, said Bryan Schueler, a vice president of development at Invenergy.
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Bridging the gap

A worker welds parts together at the Tri-State Industries manufacturing plant in Hammond. Some manufacturers cannot fill their openings. The problem, companies say, is a mismatch between the kind of skilled workers needed and the ranks of the unemployed. (Photograph by The Times.)

A worker welds parts together at the Tri-State Industries manufacturing plant in Hammond. Some manufacturers cannot fill their openings. The problem, companies say, is a mismatch between the kind of skilled workers needed and the ranks of the unemployed.
(Photograph by The Times.)

The manufacturing industry has slowly been adding jobs since the beginning of the year, giving a lift to the fragile economic recovery. Partly because the industry laid off so many workers—more than 2 million since the end of 2007—manufacturers now have a vast pool of people to choose from when they do hire.

Yet some of these employers say they cannot fill their openings. Plenty of job candidates apply for the jobs. The problem, companies say, is a mismatch between the kind of skilled workers needed and the ranks of the unemployed.

As unlikely as it would seem, manufacturers who want to expand find that hiring is not always easy. During the recession, domestic manufacturers appear to have accelerated the long-term move toward greater automation, laying off more of their lowest-skilled workers and replacing them with cheaper labor abroad.
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As recession lingers, more people making hardship withdrawals from retirement funds

Christina Rybolt talks about the Hammond house she is trying to sell after moving into her husband's home in Crestwood. "We got married in September, and we've combined two homes," she said. "I can't sell my house. I've been trying for about a year, and I'm still paying the mortgage on it." (Photograph by The Times.)

Like tens of thousands of others, Christina and Keith Rybolt felt they had no choice when they tapped into their 401(k) retirement accounts in 2009 and again this year.

“We got married in September, and we’ve combined two homes,” said 44-year-old Christina Rybolt, who moved to her husband’s residence in Crestwood from Hammond, where she made her home for 17 years. “I can’t sell my house. I’ve been trying for about a year, and I’m still paying the mortgage on it.”

Fidelity Investments, which accounts for 20 percent of the U.S. employers 401(k) plans, recently reported that more than 62,000 workers—2.2 percent of its active participants—initiated a hardship withdrawal from their retirement accounts during the second quarter, an increase of 15,000, or 2 percent, from the same period in 2009.
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Majestic Star files bankruptcy plan

(Photograph by John Luke/The Times.)

(Photograph by John Luke/The Times.)

The parent of Majestic Star casinos and hotel in Gary is taking its first crack at showing its Chapter 11 bankruptcy reorganization plan.

Majestic Star Casino LLC and affiliated companies filed a reorganization plan and financial disclosure statement Friday in a federal bankruptcy court in Delaware.

While the plan will create a framework for what creditors ultimately will receive in the deal, the company admitted that discussions are ongoing to create the best resolution for all parties involved. Majestic Star listed $540.5 million in assets and $941.7 million in liabilities as of July, which includes more than $630 million of outstanding debt.
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Study: Lakeshore shipping boon for NWI economy

Port of Indiana (Burns Harbor): Leeco Steel, steel distributor and processor, of Darien, Ill., has become the port's newest tenant this year. (Photograph by The Times.)

Port of Indiana (Burns Harbor): Leeco Steel, steel distributor and processor, of Darien, Ill., has become the port's newest tenant this year. (Photograph by The Times.)

Waterborne shipping along Indiana’s Lake Michigan shoreline generates an estimated $14 billion each year to the state economy and supports more than 104,000 jobs, according to a study released last Tuesday.

The Ports of Indiana consulted with Martin Associates, the same Lancaster, Pa.-based maritime economic consulting firm that called for a study of the economic benefit of the three Indiana ports, to do the study.

John Martin, president of the firm, said the port in Burns Harbor, steel mills and other local industries depend on using the waterways as a low-cost mode of transportation.
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One Region, One Vision in race to win

<em>Times</em> Publisher Bill Masterson Jr. and state Sen. Ed Charbonneau talk Friday at the One Region, One Vision luncheon at the Radisson Hotel in Merrillville. (Photograph by The Times.)

Times Publisher Bill Masterson Jr. and state Sen. Ed Charbonneau talk Friday at the One Region, One Vision luncheon at the Radisson Hotel in Merrillville.
(Photograph by The Times.)

The dean of regionalism in Northwest Indiana passed on the baton Friday before 350 people at the Anniversary Overview of One Region, One Vision.

“My grandfather’s generation built a lot of steel mills and refineries in Northwest Indiana,” U.S. Rep. Pete Visclosky told his audience at the Radisson Hotel. “My father’s generation built more steel mills, the Toll Road and saved the Dunes. Now it’s our chance to move Northwest Indiana ahead.”

The congressman was the keynote speaker in the middle of the two-hour conference, which brought together leaders from government, business, education and community service organizations from seven counties.
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