How an American City Can Become a Manufacturing Hub
Bloomberg's Odd Lots podcast hosts Tracy Allaway and Joe Weisenthal interview Allentown, PA Mayor Matt Turk at the Bloomberg City Lab conference in Madrid. They discuss Allentown's industrial history, deindustrialization, and current efforts to reindustrialize through strategic zoning reform, federal grants, and attracting component manufacturers. The conversation explores what practical urban manufacturing revival actually looks like versus the romantic notion people hold of it.
Summary
The episode opens with Tracy Alloway connecting the Billy Joel song 'Allentown' to the broader theme of deindustrialization, noting that Allentown became a symbol of American manufacturing decline in the 1980s. Mayor Matt Turk provides a detailed history of Allentown's industrial evolution, starting from cigar and silk manufacturing in the 19th century, through Mack Truck production (which moved from Brooklyn in 1915), World War II bomber manufacturing, Western Electric transistor production (a precursor to Broadcom), and eventually the decline tied to Bethlehem Steel's final cast in 1998. He notes the local controversy that the Billy Joel song was geographically inaccurate, as the steel industry was more in Bethlehem than Allentown itself.
Turk describes how regional leaders in the early 1990s foresaw the end of Bethlehem Steel and made conscious efforts to diversify, attracting companies like Olympus (surgical devices) and Air Products (industrial gases, including helium). Today, approximately 17% of jobs in the Lehigh Valley are still manufacturing jobs, much higher than the national average. He also highlights the region's geographic advantage — being within a day's drive of over 100 million Americans — which made it attractive for e-commerce warehousing and 'weight-gaining industries' like Ocean Spray cranberry juice and Sam Adams beer, where water is added locally to reduce shipping costs.
Turk recounts his early career at the Allentown Economic Development Corporation starting in 2008, where he helped develop a re-industrialization strategy focused on attracting smaller-footprint, boutique manufacturers to the city's existing industrial building stock of sub-100,000 square foot multi-story gravity-flow buildings. He helped form the Urban Manufacturing Alliance with San Francisco, the Pratt Institute, Philadelphia, and Detroit to share ideas. He also describes the forgotten 2010s wave of maker culture and 3D printing enthusiasm, which ultimately fizzled without transforming the manufacturing landscape.
On zoning reform, Turk explains that Allentown recently passed a form-based zoning code in early 2026 that focuses on building appearance rather than interior use, enabling light industrial manufacturing in mixed-use and residential neighborhoods. He argues that modern manufacturing is far cleaner and quieter than the smoky factories of the past and can coexist with residential areas, potentially rekindling younger generations' interest in manufacturing careers by making the work visible in everyday life — echoing historical factory towns where workers walked to nearby plants.
Regarding federal industrial policy, Turk describes how the Biden-era programs (CHIPS Act, Inflation Reduction Act, EDA Recompete Pilot) provided tangible support. Allentown secured a $20 million implementation grant after identifying a neighborhood of 23,000 people with a 12% prime-age employment gap. He notes the city scrambled post-November 2024 to lock in all grant commitments before the administration change. He expresses measured optimism about bipartisan support, citing Republican Senator David McCormick's interest in Pennsylvania competitiveness and Eli Lilly's $3.5 billion GLP-1 manufacturing investment just outside city limits — creating 850 jobs he wants Allentown residents to access.
On the tension between manufacturing romanticism and automation reality, Turk acknowledges that advanced manufacturing is less labor-intensive but argues there is a growing consumer preference for handmade goods and a societal need to preserve the dignity of work. He is skeptical of fully automated operations and sees value in keeping humans involved in production processes. On data centers, he describes Allentown as an AI skeptic city that has amended its zoning to require data centers to demonstrate energy sourcing and compliance, motivated largely by rising utility bills that burden residents already facing high food and housing costs. The episode concludes with a discussion of Allentown's demographic transformation — now 55% Latino — and the local hot dog loyalty controversy around Yako's.
About this episode
<p>The residents of Allentown are still sore about that Billy Joel song. While it's true the Pennsylvania city became synonymous with deindustrialization after the US steel industry began its decline in the 1970s, Allentown should be known for more: In the 1950s, for instance, some of the first mass-produced transistors were made in the city, which were the precursor of today's semiconductors. The city is also a unique logistics and e-commerce hub — it's a day's drive from nearly 40 percent of the US population. Mayor Matthew Tuerk, who has held office since 2022, has made reindustrialization a focus of his mayorship. In today's episode, recorded in Madrid at the Bloomberg CityLab conference, we speak to Mayor Tuerk about the city's grand strategy for building back and sustaining its manufacturing base, implementing industrial policy on a local level, how rezoning has changed in the last decade, the political puzzle of data centers, recruiting companies to come to Allentown, de-risking the American supply chain, and our favorite new category of industry — weight-gaining industries — which Allentown specializes in.</p> <p>Read more:<br /><a href="https://www.bloomberg.com/news/articles/2026-05-04/new-brookfield-venture-may-restart-abandoned-us-nuclear-project?utm_medium=referral&utm_source=podcast&utm_campaign=odd_lots&utm_content=article">New Brookfield Venture May Restart Abandoned US Nuclear Project</a><br /><a href="https://www.bloomberg.com/features/2026-proto-town-texas/?utm_medium=referral&utm_source=podcast&utm_campaign=odd_lots&utm_content=article">Texas Ranch Lures Futuristic Startups to Revive US Manufacturing</a></p><p>See <a href="https://omnystudio.com/listener">omnystudio.com/listener</a> for privacy information.</p>
Key Insights
- Mayor Turk argues that Allentown's existing industrial building stock — multi-story gravity-flow buildings under 100,000 sq ft — is actually well-suited for boutique and component manufacturers, not the large-footprint modern warehouses the region has been building for e-commerce.
- Turk claims that 'weight-gaining industries' — products like cranberry juice or beer where water is added during production — are naturally drawn to the Lehigh Valley because shipping the finished, heavier product from nearby reduces logistics costs compared to manufacturing far from consumers.
- Turk argues that the visibility of manufacturing in everyday neighborhoods is critical to rekindling younger generations' interest in manufacturing careers, drawing on the historical model of factory workers walking to nearby plants with lunch boxes — a visibility that disappeared when factories moved to exurbs.
- Turk contends that the COVID-19 pandemic validated what economic developers had been arguing since the early 2010s — that onshoring manufacturing to reduce supply chain risk and protect intellectual property from theft (particularly in China) made strategic sense, but no one had listened until supply chains visibly broke down.
- Turk describes Allentown's new form-based zoning code as enabling light industrial manufacturing in residential and mixed-use neighborhoods by focusing regulations on building appearance rather than interior use, arguing that modern manufacturing is clean and quiet enough to coexist with housing.
- Turk claims that the primary concern mayors have about data centers is not land use or lack of jobs, but the significant rise in utility bills that data center energy demand drives — adding financial pressure on residents already strained by rising food, gas, and housing costs.
- Turk argues that Pennsylvania is well-positioned to become a center of defense manufacturing, citing Bethlehem Steel's WWII shipbuilding legacy, Mack Defense's presence in Allentown, and the current demand for munitions given ongoing geopolitical conflicts.
- Turk notes that Allentown's demographic transformation to 55% Latino population makes the Billy Joel 'Allentown' narrative of a homogeneous declining industrial city feel completely disconnected from the city's current reality, framing the song's continued association with the city as a misrepresentation of its present character.
Topics
Transcript
Odd Lots is brought to you by VanEck. For years, investors basically forgot about real assets, energy, gold, and infrastructure. But look what's driving markets now. Central banks loading up on gold, massive CapEx cycles, currencies doing weird things. These assets are at the center of it. Rax, the VanEck Real Asset ETF, is an actively managed one-stop shop for real assets spanning gold, commodities, natural resource equities, and more. Go to vanek.com slash RAAXpod to learn more. Fun disclosures later in this episode. Everyone has been there. Your team's feedback is scattered across emails, chats, and sticky notes. It's a mess. But PDF Spaces and Adobe Acrobat gives you one collaborative workspace to streamline every file and comment. So…
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