Great Lakes Region Expected to See $17 Billion in Capital & Maintenance Projects Begin Construction in Fourth-Quarter 2012

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Researched by Industrial Info Resources (Sugar Land, Texas)--Recovery in the Great Lakes region of the U.S., which consists of Illinois, Indiana, Ohio, Michigan, Kentucky and Wisconsin, has been humming along for more than a year. This region was hit hard during the recession, thanks to the significant financial problems that plagued the automotive sector and the downsizing rampant among heavy manufacturing companies, both of which make up the manufacturing backbone of the region. Despite those setbacks, the region has stood up, dusted itself off and made significant strides to return to its pre-recession production levels. The recovery experienced by the automotive sector has helped tremendously, but all industries have played a significant role in the region's recovery thus far. Looking ahead at the final quarter of 2012, more than $17 billion in capital and maintenance projects are expected to begin construction within the Great Lakes region, which would cap off a very solid year on the road to recovery.

Click on the image at the right for a graph detailing capital and maintenance projects expected to begin construction in the Great Lakes region during fourth-quarter 2012.

The Alternative Fuels Industry will be the heavy hitter in total spending. Industrial Info is tracking 17 alternative fuels projects worth an estimated $10.4 billion that are scheduled to begin construction activities during the months of October, November or December, placing this key industry far ahead of its nearest competition. While this is a significant amount of spending for a single industry during a quarter, there are questions about whether all of these projects will actually begin construction. The drought that has ravaged the majority of the U.S. has significantly affected the Great Lakes region, where crop production has been devastated by the lack of water. Some of these projects may get delayed as a result of that drought, and the total expenditures would decrease--but by how much, no one is certain at this time.

The Power Industry, traditionally a major spender in the region, is currently expecting 29 capital or maintenance projects worth an estimated $3.4 billion to begin construction. While this is slightly lower than most quarters for this key industry, more than $3 billion in projected project spending is still a significant amount of expenditures for any portion of a year. The Oil & Gas Production Industry and the Pharmaceuticals & Biotech Industry are each expected to see more than $800 million in total expenditures for the final quarter of the year, while the Industrial Manufacturing Industry will contribute another $600 million and the Metals and Minerals Industry will add $579 million to the total.

Kentucky appears to be the big winner for the final months of the year, playing host to $9.6 billion of the $17 billion in the total spending for projects expected to begin construction. This marks a dramatic turnaround for the state, as Kentucky traditionally is one of the smaller spenders during any given quarter of the year. Indiana will be a distant second in total spending within its borders, with $2.6 billion in projects expected to begin construction, while Illinois and Ohio, typically major spenders in the region, will only see $1.9 billion and $1.5 billion, respectively. Michigan, which suffered greatly during the recession as companies bailed out of the state each and every day, will see lower-than-expected spending totals with only $873 million in projects beginning construction, while Wisconsin, typically a small spender like Kentucky, will add $827 million to the total.

The Great Lakes region has done a fantastic job of reinventing itself and marketing its states in order to bring industry back within its borders over the last couple of years. The recession took a significant toll on the region's bottom line, and the spending totals seen this year have done much to bring back the old swagger and confidence. Companies are finding the region attractive once again, and spending has been on the rise for most of the year, a trend that the region hopes will continue into 2013 and beyond. Provided there is not another economic collapse, the Great Lakes region should be poised to blossom throughout the final quarter of 2012 and all through 2013, bringing thousands of much-needed jobs as well as billions in spending back to a region with a long and storied history of industrial might.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.