Across North America, manufacturing is at a critical juncture. To meet the moment, manufacturers need a new playbook, with fresh strategies based on the right facts.
The industry faces geopolitical shocks, regulatory pressures, labour shortages and relentless tariffs. Automation and artificial intelligence are dramatically changing the game, too. For some, it might be a perfect storm. For others, it’s an exciting opportunity to adapt and expand.
Expanding to a new location can boost your manufacturing operations. There are several contenders across the continent for manufacturing investment. We obviously think Waterloo is a strong and safe bet, but comparative data is the fastest and clearest way to determine which location is right for your company.
Our Manufacturing Data Book compares 11 top manufacturing ecosystems across North America in talent, cost and quality of life. In this article, we compare Pittsburgh to the Waterloo region, providing you with a snapshot of what to expect in the book.
Pittsburgh and Waterloo are incredibly similar cities; both have a legacy of manufacturing expertise, strong AI clusters and mid-sized populations. Let’s see who comes out on top.
Key Takeaways
- Choosing the right manufacturing location comes down to hard data — workforce concentration, salaries, energy costs and tax rates all play a role in long-term competitiveness
- Manufacturers pay significantly less for salaries in Waterloo than in Pittsburgh, without sacrificing the quality, experience or education of the workforce
- In addition to being environmentally friendly, emission-free energy sources like hydro and nuclear also deliver more reliable, dispatchable output for manufacturers
- The Waterloo region’s corporate tax rate of 25% beats Pittsburgh’s 29%, improving cash flow, supporting reinvestment and strengthening competitiveness for manufacturers
Data Point #1: Manufacturing Workforce & Growth
Pittsburgh and Waterloo are mid-sized manufacturing hubs. Neither are massive industrial cities, like Detroit, Chicago or Dallas, but both boast sizable manufacturing workforces and the headquarters of major industry players (Toyota Motor Manufacturing Canada and BWXT in the Waterloo area, PPG Industries and US Steel in Pittsburgh, just to name a few).
Pittsburgh’s total manufacturing workforce is larger than Waterloo’s by about 40,000 people. This speaks to Pittsburgh’s well-established manufacturing industry, and strong presence of skilled workers.
However, Waterloo’s concentration of manufacturing talent is almost double Pittsburgh’s, and the latter is experiencing negative workforce growth. Our region’s manufacturing industry is growing for several reasons: our network of post-secondary schools with manufacturing-related programs, an ecosystem that attracts and supports companies and our community’s strong quality of life.
Data Point #2: Salaries for Key Occupations
You pay less for better quality talent in the Waterloo region. Hourly wages and salaries will run your manufacturing company significantly less than it would in Pittsburgh. And the talent you hire in Waterloo is well-educated, dependable and experienced. When people are your biggest asset, these factors are indispensable in building a successful company.
We recently launched our Manufacturing Cost Calculator, a tool that allows you to calculate the costs of expanding to different manufacturing cities across North America. Check it out for more data on salaries, industrial rent, energy cost and more.
Data Point #3: Emission-free Energy Generation
Many manufacturers are seeking to reduce their environmental impact, and the easiest way to do that is through the use of cleaner energy. In the Waterloo area, 84.3% of generated energy is emission-free. This means our energy grid is primarily fueled by clean energy sources, like hydro and nuclear. In addition to cleanliness, this electricity mix makes our energy grid more reliable, providing steady and dispatchable energy output.
Pittsburgh’s energy grid, like so many others across the US, is powered by gas and coal. Although some states across the US are starting to invest in cleaner energy, most regions are slow on the uptake and remain dependent on fossil fuels.
Data Point #4: Energy Cost per kWh
On top of having a cleaner energy grid, Waterloo’s energy costs less than Pittsburgh’s. The exchange rate between the two countries plays a role, in addition to Ontario’s cost-saving benefits for manufacturers.
In addition to lower base costs, Ontario offers industrial programs and province-level incentives that reduce corporate bills, like the Renewable Cost Shift and the Industrial Conservation Initiative, further shifting some of the cost away from ratepayers.
Although actual bills depend on rate class, delivery charges and load profile, our community has the edge in manufacturing-market comparison if your priority is low power cost.
Data Point #5: Corporate Tax Rate
A small tax change can have a big impact on capital projects and investment decisions. In addition to the obvious (your bottom line), corporate tax policies influence innovation, R&D and competitiveness for manufacturers.
From a financial perspective, lower corporate tax rates improve cash flow and make reinvestment easier. For export-oriented manufacturers, low rates also increase pricing flexibility and boost innovation productivity, which makes firms more competitive on national and global scales.
Comparing tax burdens across jurisdictions help manufacturers decide where to expand. And the Waterloo area’s low corporate tax rate (25% to Pittsburgh’s 29%) is another compelling reason to consider our community for your manufacturing expansion.