What’s in store for Dayton region’s economy in 2026? Here’s what business leaders tell us

In one building, several of Brockman’s 250 Dayton employees apply a finish to a bushing for a dam gate. In another building, Techmetal workers grind away material from a faulty jet engine turbine shaft. In still another, they’re found coating bone screws for medical purposes. In a fourth, they’re repairing parts for power generation.

It’s that kind of versatility that helped Techmetals weather an uncertain 2025 and sets the stage for what Brockman believes will be revenue growth of 8% to 10% in 2026.

Asked how his company is doing, Brockman gets to the point. “We’re hiring,” he said.

Drive by the company’s Springfield Street plants, and one sometimes sees banners inviting applicants to inquire within.

Techmetals has been a story of slow but steady growth, with a number of moves in recent years.

With customers in defense, aerospace, health care, automotive and other areas, Brockman said his company can turn to industries that are doing well when others suffer.

“Selecting the right strategic customers, OEMs (original equipment manufacturers), and strategic alliances — those that share similar cultures, goals, and an abundance mentality — is essential,“ said David Ferguson the company’s marketing manager.

In the first quarter this year, Techmetals will purchase and install robotic peening cells — work stations that strengthen and harden metal surfaces — capable of supporting major defense programs, like the F-35 program, Ferguson said.

A ‘different’ era

The past year offered a torrent of economic change, from a bewildering array of ever-shifting tariffs to a lapse in federal government funding of record duration.

The torrent hasn’t eased. As recently as Jan. 17, President Donald Trump threatened Europe with higher tariff rates over his desire to acquire Greenland, then dropped the threat days later.

In this region, demand for manufactured goods fell slightly, the Federal Reserve Bank of Cleveland found. Automotive production is down, and Cox Automotive projects that U.S. new-vehicle sales this year will drop further, to 15.8 million units, down 2.4% from 2025. (Cox Automotive is part of Cox Enterprises, which owns Cox First Media and the Dayton Daily News.)

Auto market softness has affected headcount at the Dayton Mahle Behr plant (known today as Mahle Thermal and Fluid Systems Dayton LLC). The century-plus-old plant still has around 900 employees, but the need for workers is not growing, plant leaders said.

Credit: Kevin Lush Photography

Credit: Kevin Lush Photography

“It’s basically hiring for attrition at this point,” said Eugene DiGirolamo, executive director of operations for Mahle Behr in Dayton.

Nationally, 584,000 jobs were created last year, well below the more than two million added in each of the previous two years.

Still, the third quarter gross domestic product number reached a surprisingly robust 4.3%, and some are optimistic.

Go bowling?

“The sense that I’m getting just in the last couple of days is that folks are feeling a little bit more comfortable,” Julianne Dunn, who heads the Cincinnati branch of the Cleveland Fed, told the Dayton Daily News after visiting with members of her local business advisory council recently. “They’re feeling like, we know what the policies are, we’re able to move forward.”

Greg Knox likes to introduce himself as “CEO and janitor” of Knox Advanced Manufacturing Solutions in Franklin. He sells CNC (computer numeric control or computer-programmed) machines to customers in southwestern Ohio and northern Kentucky.

Credit: Nick Graham

Credit: Nick Graham

As such, he has his finger on the pulse of regional industrial players — who’s buying, who’s investing, who’s biding his or her time, who’s pulling back.

“The last couple of years have been different,” Knox said. “A good word for it — different.”

From where he stands, the economy is healthy. Ohio, as a whole, has done “amazing things,” with big names like Joby Aviation, Anduril and others joining the state in the past several years.

“These are powerhouse companies that are going to create tens of thousands of jobs — good-paying jobs,” Knox said. “So that is a real bright spot here.”

But with elections, tariffs, war in Europe and varying stresses, there are challenges. “People don’t know whether they should commit suicide or go bowling,” Knox said. “That’s just been the flavor of the day. What we have found in this economy is certainly southern Ohio has been holding its own.”

Knox isn’t shy about making the case for tariffs.

“A big secret, and we all know it,” he said. “Tariffs have been around for a long time, but they’ve just been levied against us.”

“I do believe tariffs are a good thing in the long run,” he added. “Staying the course, it does work.”

Joby Aviation doubles down

2026 was just eight days old when Joby Aviation announced that it had agreed to spend nearly $62 million on a Vandalia industrial building to boost production of flying taxi or electric vertical takeoff and landing vehicles (eVTOLs).

Pending due diligence, Joby said it had agreed to spend that much on a 728,000-square-foot building at 1669 Capstone Way.

The company’s goal is to build four eVTOLs each month by 2027.

“That’s a good price,” said Dave Dickerson, president of business development for Miller Valentine Construction.

A purchase of that magnitude turns heads, Dickerson said. “Any time a user like that buys, that means they’re making long-term investment,” he said. “Nothing is permanent, but it’s a long-term investment, versus a lease, which has an end date.”

The development market has been soft for the past few years because interest rates had been relatively high, he said. But the Federal Reserve in December cut its benchmark interest rate a quarter point to a target range of 3.5 to 3.75%.

“We’re already seeing increased activities by developers because of the decrease in interest rates,” Dickerson said.

Big local projects for Miller-Valentine in recent months have included the $30 million expansions by Modula in Franklin and the expansion of a community center in Trenton, which started last fall.

Fed findings

Dunn, the senior regional officer at the Cincinnati branch of the Federal Reserve Bank of Cleveland, said 2025 was a year of doubts for some.

“2025 seems to have been marked by so many sources of uncertainty, and that really kind of threw kind of a wrench for a lot of folks,” she said in early January after visiting Dayton. “Not wanting to make big decisions, how can we plan for this?”

Mahle Behr’s DiGirolamo said tariff rates have shifted enough to keep company planners on their toes.

“It’s an unknown impact, is what I’d say, because we can’t plan on a specific figure,” he said when asked about tariffs.

Said Mahle Behr spokesman Jeff Trent: “The key point is the cost (of tariffs) is real, and it’s not a cost we can absorb.”

Mahle Behr can negotiate supplying parts to an OEM, such as GM or Honda, DiGirolamo said. The prices are set at that point. Suddenly rising costs can’t easily be passed on to customers, he said.

Life, he added, would be “dramatically easier” from a tier 1-supplier perspective — which is what Mahle Behr is, a global automotive parts supplier — if tariffs lessened or stabilized.

Amy Schrimpf, president of the Dayton Region Manufacturers Association, said tariffs are “mixed bag” as to who in Dayton is benefitting, and harmed. She hears from both sides.

“All of our members say, ‘Tell us what the (tariff) rules are and keep them stable. And make it as level a playing field for American manufacturing as possible, with as little volatility.’ That’s what they’re asking for,” she said.

Workforce remains the top issue for DRMA members, as confirmed by a recent members’ survey.

“A skilled workforce remains the most important issue to our members,” Schrimpf said. “Tariffs came in at No. 2.”