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Pittsburgh Forging a High-Tech Future : Steel Capital Refocuses Its Economy

July 21, 1986|JAMES RISEN | Times Staff Writer

PITTSBURGH — The old mill had stood for generations along the river bank near this city's downtown, spewing out steel for Jones & Laughlin and pollution for everyone else in Pittsburgh.

In its heyday, back when all the blast furnaces in western Pennsylvania were working overtime, it was also a symbol. As the only major mill inside the city limits, it was a visible monument to the hot metal that made the Pittsburgh area flourish.

Today, the American steel industry has collapsed and much of the old J&L mill has shut down. Still, it has become a symbol once more--this time of the rapid transition in Pittsburgh from a dependence on heavy industry to a more diversified service and technology-based economy. Part of the mill is to be leveled by the city so the site can be developed into an industrial park for new high-technology companies.

The development at the J&L site is just one aspect of a startling phenomenon in Pittsburgh--America's steel capital is on the verge of becoming a strong regional center for computer-based high technology.

Great Changes Already

But what is most surprising is the extent to which the city's economy has already changed; in the Pittsburgh metropolitan area, more people now work in high-tech fields than in basic steelmaking.

"There's been a fundamental transformation going on here," observes Timothy Parks, executive director of the Pittsburgh High-Technology Council. "Now, we are very close to developing the kind of critical mass you need to have a real high-tech community, with new firms spinning off (of) established companies."

While dozens of mills and thousands of steel jobs have been lost in the Pittsburgh area over the last decade, new high-technology start-up firms, many founded by computer researchers from Carnegie-Mellon University, have slowly gained a foothold in one of the oldest and most tradition-bound business communities in America.

Research Grows

Meanwhile, medical and university research has continued to grow, and many of the major corporations based here--despite Chevron's acquisition of Gulf, Pittsburgh is still home to more than a dozen Fortune 500 companies--have continued their research and development efforts in the area even while laying off production workers. Now, Pittsburgh has the fifth-largest concentration of engineers of any city in the country.

So at the same time that steel jobs have been disappearing, high-tech employment has been steadily rising in Pittsburgh, and the two trends crossed paths sometime in the last three years, observers here say.

At least 50,000 workers are now employed in technology-related jobs in the Pittsburgh area, while steel employment has declined from 71,000 in 1975 to just 31,000 today, according to the Penn Southwest Assn., a local economic development group.

"The trend toward high tech here is changing the population of the city," notes Larry Geisel, president of the Pittsburgh-based Carnegie Group, which develops artificial intelligence software for use in computer-aided manufacturing.

"The old mill towns outside Pittsburgh are dying, but in the city itself, where most of the high-tech activity is going on, we are going from 25% white collar and 75% blue collar to exactly the reverse."

Largely Unnoticed

The gradual growth of Pittsburgh's high-tech community went largely unnoticed, even by local civic leaders, until late in 1984 when the Pentagon, after a nationwide site selection process, made Pittsburgh the home of its new national laboratory for computer software research. The center's task will be to become a nationwide clearinghouse for information about developments in software research, and it is expected to have 250 technical staffers within five years.

The Defense Department decided to locate its Software Engineering Institute on the campus of Carnegie-Mellon because of the school's computer science department, which has a longstanding reputation as one of the top two or three in the country. (At the same time, many of the new high-tech firms here, especially those founded by Carnegie-Mellon scientists, are involved in developing computer software.)

So now, John Manley, the new director of the Pentagon's software institute, predicts that Pittsburgh has a chance to become a national center for software development.

"I think there is no question that this center should help make Pittsburgh preeminent in software technology," says Manley. "We should be like a magnet. We'll become an information center on software if we are doing our job right. So eventually, people in software development might find they would be better off locating near us."

Automation Technology

With its strong background in manufacturing, Pittsburgh is also developing a niche in automation technology. Carnegie-Mellon's Robotics Institute, for instance, has 200 scientists and engineers, and is now the world's largest industry-financed center for research in robotics and manufacturing technology.

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