Milwaukee economic boom

[denvernative1982]

Looks like Milwaukee's economy is heating the payrolls are up 2 percent over the last year. This translates to 18,000 people on the payrolls over one year ago. This is from the Bureau of Labor Statistics. The Unemployment Rate is around 4 percent, this is down from close to 7 percent in early 2003.

Milwaukee has a big advantage on costs and is close to the Chicago Metro area, The housing market is showing signs of heating up and it was recently ranked as the most underrated city in America. I also saw a post crime rates which were very high in the late 1990's are back to levels typical of a big city?

You think Milwaukee will boom next? Shoboygan seems to have stabilized also economically!

[milwaukeeunseen]

We seem to be on the right track here. I know many, many talented people who are working like hell to bring this city into a new age of greatness. When the west end of the Menomonee Valley is redeveloped (www.renewthevalley.org) we won't look so "rust belt" anymore. I know quite a few people who could have easily landed in New York or Chicago, people working in the fields of architecture, planning, economic development, etc, who were drawn to Milwaukee because they could see the potential that's now finally blossoming.

Back in the '90s we surprised people by building high end condos Downtown. That would have been unthinkable before. The Downtown boom is so entrenched now people don't even seem to notice anymore when a new residential building goes up in Downtown, Brewers Hill, Walkers Point, etc. In the 2000s we're taking it a step further and rebuilding our city economically -- not just high end condos, but new family-supporting jobs. That's why the Valley redevelopment is so exciting. It's not only an innovative green industrial park, it's hundreds of new jobs for inner-city residents.

So, if we keep this up, and there's no reason to believe we won't, Milwaukee really could be a great Rust Belt success story in 10 years time.

[ReddAlert]

I have really high hopes for the Park East and Menomonee Valley. In their current state are nothing but concrete and industrial hell. Its kind of a clean state I would think. I would love to see more high tech industries be established or drawn to Milwaukee. As for the Park East...from what I hear, is going to mainly be condos and shopping. Good shopping is something much needed in Milwaukee in my personal opinion.
As you said unseen...alot of new housing and other buildings are being put up so fast that I cant keep up with it all. Alot of places in the Third Ward, Walkers Point...and especially that Beerline along Commerce St. Ive seen some pics of these new condos being built, and they look great--especially considering the area was all industrial across the river.
I just wish my side of town would start getting some nice things. All we ever get on the northwest side of town are Pick n Saves, chicken shacks, clearance shoe and clothing stores, and gas stations. Im glad to see Northridge being redeveloped...however its just boring old Pickn Save and Menards. I was hoping they would build a UWM extention campus like someone was saying awile back.

[EastSider]

We seem to be on the right track here. I know many, many talented people who are working like hell to bring this city into a new age of greatness. When the west end of the Menomonee Valley is redeveloped (www.renewthevalley.org) we won't look so "rust belt" anymore. I know quite a few people who could have easily landed in New York or Chicago, people working in the fields of architecture, planning, economic development, etc, who were drawn to Milwaukee because they could see the potential that's now finally blossoming.

Back in the '90s we surprised people by building high end condos Downtown. That would have been unthinkable before. The Downtown boom is so entrenched now people don't even seem to notice anymore when a new residential building goes up in Downtown, Brewers Hill, Walkers Point, etc. In the 2000s we're taking it a step further and rebuilding our city economically -- not just high end condos, but new family-supporting jobs. That's why the Valley redevelopment is so exciting. It's not only an innovative green industrial park, it's hundreds of new jobs for inner-city residents.

So, if we keep this up, and there's no reason to believe we won't, Milwaukee really could be a great Rust Belt success story in 10 years time.

Well said, Thank You.

[milwaukeeunseen]

I have really high hopes for the Park East and Menomonee Valley. In their current state are nothing but concrete and industrial hell. Its kind of a clean state I would think. I would love to see more high tech industries be established or drawn to Milwaukee. As for the Park East...from what I hear, is going to mainly be condos and shopping. Good shopping is something much needed in Milwaukee in my personal opinion.
As you said unseen...alot of new housing and other buildings are being put up so fast that I cant keep up with it all. Alot of places in the Third Ward, Walkers Point...and especially that Beerline along Commerce St. Ive seen some pics of these new condos being built, and they look great--especially considering the area was all industrial across the river.
I just wish my side of town would start getting some nice things. All we ever get on the northwest side of town are Pick n Saves, chicken shacks, clearance shoe and clothing stores, and gas stations. Im glad to see Northridge being redeveloped...however its just boring old Pickn Save and Menards. I was hoping they would build a UWM extention campus like someone was saying awile back.

I agree the Northwest Side is neglected. One third of the population of the City lives north of Capitol Drive. That's a lot of people. And the NW side gets basically no attention from the City, developers, etc.

[Steely Dan]

So, if we keep this up, and there's no reason to believe we won't, Milwaukee really could be a great Rust Belt success story in 10 years time.

there's not a doubt in my mind about that. milwaukee seems to have all the ingredients and it's now taking advantage of them and using them in a way to create a self-perpetuating cycle of urban rejuvenation. it's gonna be fun to see how different that town is 10 - 20 years down the road.

[Bond James Bond]

On a semi-related topic, here's an article about a couple of Milwaukee companies from a story in the Wall Street Journal several weeks ago. Thought I'd just stick it here, for the heck of it . . .

The Wall Street Journal
Tuesday, January 25, 2005
Investors Love the Big Machines

In the commodity boom like the one that gripped the world over the past year, many investors see a gold mine in . . . equipment makers.

It's a far cry from Internet highflyers, but digging gold, iron ore or copper out of the ground takes huge amounts of expensive machinery, which is why the share prices of companies such as Caterpillar Inc., Terex Corp. and Japan's Komatsu Ltd. Have risen over the past year.

But among this group are two lesser-known names that are even more specific to this niche; they have the distinction of being strickly mining-machine companies. One is Bucyrus International Inc., which has soared 97% from the offering price of the company's initial public offering of stock last summer. Bucyrus makes mining drills, shovels and most of the world's "draglines," humongous machines used to move soil in open-pit mines. The other is Joy Global Inc., Bucyrus' main competitor, which has seen its stock rise 60% since the start of 2004.

The question for investors is how long the current good times will last and whether it is too late to jump into these stocks. The answer to that hinges almost entirely on what happens to commodities, which are prone to roller-coaster ups and downs. Recent attempts by China to slow its booming economy and signs of moderating prices for certain commodities have made some investors cautious.

"These stocks all across the board have had a tremendous run, so we've pulled back," says Steve Allen, portfolio manager at Preservation Capital Management LLC in Frankfort, Ill. His company doesn't hold any shares in mining-equipment makers, though they have owned them in the past. Similarly, Mark Keeley, vice president of research and marketing at Keeley Asset Management Corp. in Chicago, says his company isn't looking to add to its position in these stocks. Keeley owns shares in Joy, Bucyrus and Terex.

Headquartered only a few miles apart in greater Milwaukee, Bucyrus and Joy Global were considered industrial-age dinosaurs only a few years ago, when unprofitable mines were being closed all over the globe. Both went through bankruptcy-court procedings in the past decade but are riding high now as the revival of the world's industrial economies and the emergence of China as a major importer of raw materials have fueled a surge in commodity prices.

Joy specializes in equipment for underground mining, with roughly 70% of sales going to the coal industry world-wide. James Margard, principle at Rainier Investment Management Inc. in Seattle, says that as long as the prices of oil and natural gas stay high, there will be heavy demand for coal. And even if China's economy slows, he adds, that country is is short of power it will continue to consume vast amounts of coal even through a broader economic slowdown.

Few people see the machines made by these companies, but their work helps make possible huge gains in productivity in mines, which in turn, helps contain some of the inflationary pressures at that end of the production chain. At Bayrus, for instance, the company has developed computer systems that allow technicians on the sixth floor of the company's South Milwaukee headquarters to monitor machines anywhere in the world and help them become more efficient.

"Customers use this like film in the NFL," says Tim Sullivan, the company's president and chief executive, pointing to a computer screen showing real-time movements of a dragline in northern Canada. Mine operators can use this to pinpoint bottlenecks or help machine operators deal with problems that slow production.

But it is in the cavernous factory halls nearby the companies like this see the most obvious impact of the boom. Bucyrus, which shuttered large portions of its plant during the slump, continues to reopen buildings and said last week it plans to lease a plant nearby to handle further expansion. Outside one factory building one recent winter day stood a 65-foot-tall rotary blast-hole drill, a machine used to drill into rock and set explosives. The machine, which was going through final inspection, is destined for an iron-ore mine in Mauritania.

Across town at Joy's headquarters, Chief Financial Officer Donald Roof says his company does well when his customers do well. "U.S. coal in Appalachia is selling for $62 a ton, a year ago it was $30 or $35," he says.

Joy and Bucyrus produce a relatively small number of large machines each year, but each sells for millions of dollars. For instance, Bucyrus last year sold a dragline to Ensham Resources for use in its Australian coal-mining operation that analysts expect will generate $70 million in revenue for the equipment maker and take two years to complete.

There is a crop of investors who are convinced that there is still upward potential. Rainier Investment's Mr. Margard is one. "What's going on in the world in terms of energy demand appears to us to have a long tail and will likely mean a lengthy cycle," he says. Joy is the largest single holding in Margard's Small/Mid-Cap Equity Portfolio mutual fund.

In 4 p.m. composite trading on the Nasdaq Stock Market, Bucyrus's stock eased 11 cents to $35.51, giving the company a market value of about $711 million. Shares of Joy Global, which has a market capitalization of $2.18 billion, were at $27.87, up 60 cents or 2.2% each, as its 3-for-2 stock split took effect.

To be sure, nobody expects commodity prices to keep soaring. The question is whether they will simply moderate – or plunge. Eventually, enough new mining capacity will open or global demand will slump and prices will come down, and with it the stock of equipment makers. But some analysts believe the world economy has entered an extended period in which commodity prices will have higher highs as well as higher lows.

Barry Bannister, an analyst at Legg Mason Wood Walker in Baltimore, says he expects the emergence of a vast new middle class in China and other developing regions – and the growing demand for manufactured goods that comes with it – to help bolster commodity prices until about 2015. He also sees the possibility of hoarding of commodities by users worried about shortages. Mr. Bannister has a "buy" rating on Bucyrus and Caterpillar, a "hold" rating on Joy. His company provides investment-banking services to Bucyrus. Legg Mason says it doesn't hold more than 1% in any of these three stocks.

Frank Husic, chief investment officer of Husic Capital Management in San Francisco, own shares in both Bucyrus and Joy and says he believes equipment makers have "begun a major secular bull market." He likens these investments to owning companies that make machines to make semiconductors duing the technology rally. "When semiconductors boomed in the late 1990's," he said, "you did even better in the semiconductor capital-equipment companies."

[ReddAlert]

wow, Ive heard of them shipping giagantic mining equipment out of the Port of Milwaukee--however I didnt know that it was that big around the world. Very informative....thanks for posting Bond. I guess all of our industries aint dead yet.

[Bond James Bond]

^You're welcome. :)

[Bond James Bond]

BTW, from the article, this gives you an idea of how big these things must be:

"Joy and Bucyrus produce a relatively small number of large machines each year, but each sells for millions of dollars. For instance, Bucyrus last year sold a dragline to Ensham Resources for use in its Australian coal-mining operation that analysts expect will generate $70 million in revenue for the equipment maker and take two years to complete."

For comparison, I read recently that the new Boeing 787 will sell for a typical price of about $120 million each. So, those big pieces of mining equipment are more than half the value of a big jet airplane!!

[Bond James Bond]

Out of curiosity, I just went to Bucyrus' website to check out some pics.

It would be kinda cool making stuff like this - big huge monster machines!! :D

http://www.bucyrus.com/680W.jpg

http://www.bucyrus.com/8200.jpg

http://www.bucyrus.com/2570WS.jpg

http://www.bucyrus.com/182M.jpg

[Bond James Bond]

And here's some from P&H Mining, which is a subsidiary of Joy Global:

http://www.phmining.com/photos/images/9020.jpg

http://www.phmining.com/photos/images/2800xpb.jpg

I like this one the best. :)
http://www.phmining.com/photos/images/4100xpb-1.jpg

And here's what it looks like inside one of Joy Global's factories, where they make some other stuff
http://www.joy.com/photo_gallery/photos/12CM12.jpg

So, I guess this goes to show you guys make other stuff besides beer. ;)

[ReddAlert]

70 million! Thats one pricey little shovel. Its kind of cool knowing we still build some of this heavy machinery. Others on this site also said that Milwaukee produces parts of the Space Shuttle program, the U.S. Mint, and robotics compainies. I have a question to someone who may know this kinda stuff..
I was reading a military special forces book today..and saw a Green Beret using a tracking devise that had the words Rockwell on it. The print looked the same as on the Rockwell Automation clocktower....does anyone know what they do there?

[ReddAlert]

[QUOTE=Bond James Bond]Out of curiosity, I just went to Bucyrus' website

thats what I call some heavy machinery. Pretty cool stuff. Thanks for the pics bond...very cool pics.

[Markitect]

OK, first off, a little netiquette lesson for future reference--when you are quoting somebody else's message, and it has photos in it, please, please please do not repost the photos!! It really slows down page loading for those of us with dial-up connections--and nobody needs to see the same images more than once in a single thread anyway, regardless of their internet hook-up.

Thank you.


Now, on with the rest...

Bucyrus will be expanding its Milwaukee-area operations when it moves into the former Metso Minearls complex on the South Side. It will being in some 100 union jobs and some positions that pay $22 an hour. This is thanks to Mayor Barrett, who got all the right people to sit down together and come up with a financial plan to win the Bucyrus bid (they were also looking at sites in Idaho and Texas to locate this facility).

As for Rockwell/Allen-Bradley, it makes industrial control and automation equipment. The best place for info is their website. (http://www.ab.com/)

[ReddAlert]

sorry bout that Mark, didnt even think about it. Yeah that Metso building looks pretty evil at night...it just reminds me of something from Gotham City.

[Ben]

I'm applying to Rockwell tomorrow in Richland Center(Frank Loyd Wright). I've said it before, American Signal is located in Milwaukee now that they've moved out of Mequon recently. They're sort of "tied" with Federal Sginal in University Park, IL for "best siren manufacture" as they make, and have made over the years, a diverse set of weather warning and outdoor warning device signals. They manufacture the current loudest siren and second loudest siren ever(that big 8 foot, 1,600LB 900 amp draw beast of machinery I showed you a photo of). They also have stuff in the solution news section of their website americansignal.com about doing stuff in Oshkosh, Des Moines and a few other notable installations and notable clients.

[Bond James Bond]

Good lord, what the hell is happening over there?

The Business Journal of Milwaukee - 2:54 PM CDT Thursday
State posts lowest unemployment rate since late 2001

Wisconsin's seasonally adjusted unemployment rate for April was 4.5 percent -- the lowest rate since September 2001 and the 11th straight month the rate has been below 5 percent.

Department of Workforce Secretary Roberta Gassman said Thursday that the September 2001 estimated rate was 4.4 percent. The April estimated rate also was below both March's tally of 4.6 percent and April 2004's rate of 5 percent.

In addition, the April rate compared with national rates of 5.2 percent, unchanged from March, and of 5.5 percent last year.

Gassman said the estimate for nonfarm wage and salary jobs was 2,810,300 in April 2005, up 34,200 jobs over the previous month. The industries with the largest monthly employment gains included construction, leisure and hospitality, professional and business services, and retail trade.

"Wisconsin's labor market showed continued improvement last month, with job gains of nearly 27,000 over last April, including more than 2,000 new jobs in manufacturing," Gassman said.

Compared with last year, nearly all of the state's major and industrial sectors -- except natural resources and mining, certain manufacturing sectors and financial services -- posted gains.

[EastSider]

^Isn't it fun.

[Bond James Bond]

From the stuff about Bucyrus we talked about above, here's something I just found.

This is one sale. I wonder if the salesman got a commission for this, and I wonder how much the commission was . . .

Bucyrus makes $25 million sale to Brazilian mine
By RICK BARRETT
Posted: May 16, 2005

Bucyrus International has sold about $25 million worth of mining equipment to a Brazilian copper mine, company officials said Monday.

The equipment includes two electric mining shovels and four drills. One shovel has already been shipped, and all the equipment is scheduled to be in operation at the mine later this year, said Kent Henschen, company marketing director.

All the equipment is being manufactured at Bucyrus plants in South Milwaukee and Milwaukee.

It's a large order from a single customer, Henschen said.

Bucyrus is one of the world's biggest makers of large-scale mining machines. There's strong demand for its machines in South America, Australia, China and the United States because of demand for coal and other minerals.

There's near-record demand for almost every commodity extracted from the ground, according to the National Mining Association, a Washington trade group.

The United States is almost certain to set a record for coal consumption this year, with about 1.1 billion tons of coal consumed by coal-fired power plants, steel mills and other industrial users, according to the association.

Bucyrus is building a $76 million dragline for an Australian coal mine that will be the second-largest machine of its kind in the world, according to the company.

A dragline is an excavating machine that removes earth to expose underground coal seams. The Australian machine will be taller than a six-story building and longer than several Boeing 747 airliners parked end to end. A scoop of its bucket will lift more than 700,000 pounds of dirt.

The world's biggest dragline, also built by Bucyrus, lifts about 800,000 pounds.

Most of the world's mining equipment is built in the United States or Europe. The Milwaukee area is home to two of the biggest mining equipment companies, Bucyrus and Joy Global Inc.