Now Hiring
For the first time in 25 years, Iron Range workers can see the light at the end of a very dark economic tunnel
BY TOM MASON
Joe Scipioni is a lifetime Iron Range resident and a third generation miner. His grandfather arrived from Italy in 1903 and spent more than 40 years in the mines. His father, too, devoted his career to the mines. And Scipioni, after getting a degree as a civil engineer from the University of Minnesota, has spent more than 30 years in mine management. His family has endured the ups and downs of the economy; the best of times and the worst of time.
For the last quarter century, it has been the worst of times.
During its heyday, the Iron Range employed more than 16,000 mining jobs. Today’s Range only employs about one-quarter of that number. Its low point may have come in February 1989, when 2,300 unemployed miners applied for just 25 temporary mining jobs.
That’s all about to change. While much of the American economy has slowed considerably, fueled by problems in the credit markets, the Iron Range is poised for an unprecedented surge in economic growth. The long-stagnant price for steel has broken free as the economies of China and India—each growing at nearly 10 percent per year— have developed a demand for steel. To date, this demand has inspired more than a dozen mining and energy related projects poised to breathe new life into the Iron Range economy.
Sandy Layman, commissioner of Iron Range Resources, has predicted that these projects could bring in 7,000 construction jobs and create 2,500 well-paying permanent jobs on the Range. Iron Range Resources is a state agency based in Eveleth that has focused on economic development on the Iron Range, providing a variety of incentive programs to assist businesses that want to expand or relocate to the Iron Range.
“No one expects that every project in the queue right now is going to come to fruition,” Layman says. “But we all know that the more projects you have in play, the better your chances of success.”
As president and CEO of PolyMet Mining, Scipioni may be part of the most interesting project on the list.
PolyMet has invested $40 million in the process, planning and permitting of the redevelopment of the former LTV mine in Hoyt Lakes that has laid dormant for more than six years since LTV shut it down. The conversion will require some 250 construction jobs over two years and will employ 400 people when the plant is in operation. When finished, its investment will grow to $380 million.
The PolyMet facility will use modern technologies to mine and process nonferrous metals from what Scipioni says could be one of the largest deposits of copper and nickel in the world. His operation will also mine a long list of precious metals that include gold, silver, platinum and palladium.
PolyMet’s operation is expecting the results of the state’s environmental impact study. If all goes well, Scipioni says construction could begin near the end of this year.
Scipioni’s enthusiasm is not just for the mining industry, but also for the multiplier effect of other companies that will grow and expand to serve the mines and the growing economy. A study by the University of Minnesota Duluth estimates that PolyMet’s NorthMet project will create nearly 500 full-time, permanent jobs, more than 200 additional jobs at companies that supply to the copper facility and 353 additional jobs at places where new workers spend their paychecks, such as restaurants. In other words, the boom’s ripple effect will expand the Iron Range economy in all different directions.
“That’s what’s exciting,” Scipioni says.
“This is going to spark a rebirth of the Iron Range,” says Peter McDermott, president of the Grand Rapids-based Itasca Economic Development Corp. “For the past 30 years, our average wages have stayed flat, at about $30,000 per job. Back in 1980, we actually had a higher average wage than the rest of the state because of mining and the forest products industry, primarily. Today, we’re about $10,000 per job behind. I look at this as an opportunity to bring back the Iron Range to its prior heyday.”
To be prepared for the expected boom, Iron Range area officials created the Range Readiness
Initiative to recruit and train a work force, find temporary and permanent housing and exploit related economic development opportunities. The Initiative is a group of government, nonprofit entities that works on economic development throughout the Iron Range, the Arrowhead area and Douglas County, Wis.
“If we don’t do anything, there will be a good multiplier effect of maybe one to two. But if we do a good job, we could get that up to two to three,” McDermott says. “That’s the key. We need to get people to think of northern Minnesota as a place that they could work and put their businesses. We need to diversify our economy.”
Housing, too, will be tough. McDermott says the Readiness Initiative has been working to establish an infrastructure for housing, something that hasn’t been needed over the Range’s 25-year economic slump. “Some of these smaller communities don’t have zoning rules or the sort of infrastructure to support these things,” McDermott says.
Duane Northagen, community economic development director for the city of Hibbing, agrees that temporary housing might be a challenge. “There are going to be a lot of people looking for housing that we don’t have,” he says. “Permanent housing will happen gradually and more gracefully. It will be a challenge, but a wonderful challenge to have.”
Some progress has been made to prepare for the influx of Range workers. In Hibbing alone, Northagen says, Iron Range Resources has already approved one housing infrastructure grant and is processing four more this year for housing developments of between 10 and 55 units. “For Hibbing, that’s huge,” Northagen says.
In his 11 years in Hibbing, there has been only one other new development.
“This is a blessing for us, that we are poised to have one of our best growth periods in my lifetime,” he says.
McDermott agrees. “When you look at a map and see the large number of projects, you say, ‘This is unbelievable.’ Even if half of them happen, even if a third of them happen, it’s going to be a very big deal.”
As compared to the rest of the state, the Iron Range has a higher percentage of people over 65 years of age, according to McDermott. But he hopes these new opportunities will entice younger workers to stay. “People like to live here, they lost their jobs but they stayed. But worse, they told their kids there were no jobs and that they had to leave,” McDermott says. “Now we have this opportunity. We have to impart on our kids [that] there are jobs. There is a good quality of life. You will be able to make a living here. And I think that’s key.”