What happened to Pittsburgh

Every G-20 Summit (formerly G-8 Summit) has two side stories. The first side story is about the protesters. The second side story is about where the meeting is happening. In this case, the story is about Pittsburgh's transformation from steel to the knowledge economy. For example, this morning's Washington Post has a story on Pittsburgh Shows How the Rust Belt Can Be Polished Up. The emphasis of these stories has been the rise of the educational and health care sectors of the city's economy. (See also this OurFuture.org blog posting on the coverage.)

But that focus may be misleading. A report from OurFuture - Pittsburgh: The Rest of the Story - offers a more detailed analysis:

First, manufacturing did not disappear entirely. In addition to steel, Pittsburgh industry diversified into products ranging from advanced metal alloys to surgical implants and sophisticated robotics. With roughly 100,000 workers, or 10 percent of the area workforce, manufacturing remains a vital part of the regional economy. Manufacturing jobs are generally unionized, so they pay well and generate economic activity beyond the company payroll.
Second, these changes didn't happen automatically. This wasn't an unstructured evolution from gills to lungs. It was the result of deliberate plans, of partnerships between government and private industry to achieve shared goals. It involved public investment in infrastructure, private and government subsidies, and express plans to "pick winners" and support them until they gained a lead. It is a story of industrial planning, a piece that has been missing from our national economic equation for the last 30 years.

Interestingly, that transformation includes metals:

The manufacture of steel grew and transitioned into the manufacture of specialty metals and sophisticated alloys. Allegheny Technologies Incorporated manufactures titanium, hafnium, tungsten, and cobalt. With 9,600 full-time employees and $5.3 billion revenues in 2008, the company forges custom fittings for the defense, aerospace, and nuclear energy industries. Over 300 other metals technology service firms provide steel production equipment, engineering services, parts, and supplies.

In other words, manufacturing in Pittsburgh is part of the knowledge economy.

That is a lesson we need to remember.