Lakeshore area endured '09 recession

Despite global economic slowdown, several businesses open or expand

By Charlie Mathews, Herald Times Reporter

MANITOWOC —The global recession of 2009 battered Lakeshore-area businesses and workers, but didn't dampen the entrepreneurial spirits of the entire business community, including Dr. Kenneth Katz.

In November, the Manitowoc native announced his intent to go forward with a new $7 million, five-story, 35,000-square-foot central services building downtown on York Street.

The majority partner of Dermatology Associates of Wisconsin, Katz said, "It would have been more logical for us to have built in Green Bay or the Highway 41 corridor, but I grew up here, live here and believe in Manitowoc."

The 39-year-old, fourth-generation physician directs operations at 10 clinics. Katz said the new building would increase its downtown staff from its current 30 employees to 75 by the end of 2010, and add a total of nearly 125 new "white collar" jobs over the next two to three years.

Other Lakeshore-area businesses opening or expanding in 2009 or the near future, despite the most challenging financial environment in decades, included MC Sports, Aldi grocery store, Orthopaedic Associates, Aspen Dental, A&W Restaurant, Nikko's Thai & American Cuisine, Dr. Dawg, Larry's Piggly Wiggly and Union State Bank.

In the manufacturing sector, Manitowoc Tool & Machining added about 80 to the payroll by the end of 2009, including many new hires beyond recall of individuals laid off. A key to the company's expansion was the investment of several million dollars in technology.

Manitowoc Main Street, a state Commerce Department-sponsored initiative entered its second year, with a goal of economic revitalization of the downtown.

The Economic Development Corporation of Manitowoc County reported that since 2004 it has assisted several hundred existing and entrepreneurial business clients.

Help is offered through such efforts as the E-Seed course and business plan assistance.

Project Mini-Chopper entered its second year with area high schools, touting manufacturing employment opportunities as students create downsized motorcycles.

The Chamber of Manitowoc County continued supporting the business community through a buy-local campaign, educational programs, co-sponsorship with the EDC of the annual business summit, sponsorship of SAIL, the young professionals network, and other endeavors.

Double digit unemployment

Layoffs in 2009 were widespread as the city of Manitowoc's unemployment rate in May escalated to 13.5 percent, more than double the previous year and the highest in more than 25 years. The county's unemployment rate also shot into double digits, beginning with 11 percent in March.

The most recent data from the state indicated a November unemployment rate of 11.2 percent in Manitowoc, compared with 6.2 percent in 2008 and 9.1 percent in the county, compared with 5.4 percent a year earlier.

In 2009, Manitowoc Crane announced layoffs of about 100, while Busch Agricultural Resources Inc. laid off 45 individuals with the malt plant's operations set to be reduced by 70 percent.

Many businesses had to resort to less-than-full-time workweeks for employees or unpaid furloughs, including Gannett Midwest Publishing, which operates the Herald Times Reporter.

Greenwood's Video & Appliance in Two Rivers closed after 72 years of operation. The Cottage restaurant in downtown Two Rivers closed after its predecessor, Element, also was unsuccessful. Papa John's in Manitowoc also closed its doors.

Koenig & Vits, the aluminum rolling mill in Manitowoc, closed its doors and turned off ingot-melting furnaces in May. The company entered receivership in October as court-appointed personnel sought to sell the assets to satisfy creditors owed more than $7 million.

The recession had its impact on the tourism industry, as evidenced by the S.S. Badger carferry shortening its sailing season in spring and fall by four weeks.

Prices were reduced but no condominium units were sold in 2009 at The River Lofts in downtown Manitowoc, a $5 million residential project aided by some $2 million of city funding.

Presidential praise, sales lag

In March, President Barack Obama praised Manitowoc-based Orion Energy Systems at a renewable energy summit in Washington, D.C. With one of its Apollo Light Pipes on display, Obama hailed Orion as an innovator in "green" technology.

Despite the presidential endorsement, Orion officials reported at the company's annual meeting that revenue was down about 20 percent from the previous year.

Shares of Orion — "OESX" on the NASDAQ — sold on Jan. 1 for $5.40 but were priced at about $4 as 2009 comes to an end. Shares had traded at $20 just after New Year's in 2008.

Citing a global slowdown in construction, The Manitowoc Company said crane sales in the third quarter of 2009 were down 50 percent from the same quarter in 2008.

Shares of the company — "MTW" on the New York Stock Exchange — sold for $5.40 at the beginning of 2009, down from nearly $49 in early January 2008. The share price rebounded to about $10 as 2009 was drawing to a close.

Cash for Clunkers spurs sales

The federal government's subsidy of new car sales proved to be a summer stimulus across America and in the Lakeshore area, as well.

More than 100 new cars were sold at Maritime Ford-Lincoln-Mercury, Pietroske GM, Krajnik Chevrolet, First Chrysler and Vogel Chevrolet as owners turned in their "clunkers."

The national wave of dealership closings did not hit Manitowoc County, however, as all five remain open.

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