WANTED: Skilled Workers in Shrinking Industry

WANTED: Skilled Workers in Shrinking Industry

by Janet Leiser | Senior Editor

Today, there are about 390,400 people employed in Florida's manufacturing industry, about 100,000 fewer workers than 10 years ago. Still, insiders say the industry suffers from a shortage of skilled labor.

While U.S. Department of Labor statistics show that manufacturing workers make up only about 4.6% of the state's labor force of 8,476,500, the industry has an estimated annual economic impact of $30 billion statewide, says June Wolfe, president of the South Florida Manufacturers Association. Than number pales in comparison to the king of Florida industries - tourism - which has an economic impact of at least $57 billion.

Payroll for the state's estimated 14,000 manufacturers, most of whom are small- and medium-sized with less than 500 workers, is about $17 billion a year, she says. Only about 15 to 20 manufacturers, including big defense contractors such as Northrop Grumman and Raytheon in Pinellas County and door-and-window manufacturer PGT Industries in Sarasota, employ a large number of workers.

In January 1997, nearly 468,800 people were employed in Florida's manufacturing industry. By last December, that number dipped to the current 390,400.

"We have lost a lot of jobs," Wolfe says. "But the youths and others have not been filling the ones we have. Most everybody at the machine is in their early 50s and 60s, getting ready to retire. We still have 400,000 jobs that need to be continually filled."

Manufacturing is important to the economy. It creates wealth for a community when goods are made and sold.

"If we as a country continue to let manufacturing slip away our economy will suffer severe setbacks - setbacks of which we probably can't even fathom," Wolfe says. "Our standard of living will plummet."

Increased productivity

Wolfe, immediate past president of the Florida Manufacturers Association, says there are several reasons for the decline, including improvements in technology and strides in production, all great for the industry. But the contraction is also due to the loss of factory jobs to foreign countries, including China and India, that offer cheap labor, no government oversight and little or no corporate taxes.

She contends improved efficiency means there are fewer jobs, but those available will require more highly skilled workers and pay more.

Peter Straw, executive director of the Sarasota-Manatee Manufacturers Association, agrees. He says PGT is an example of a company that's hiring more highly skilled workers. The company has 2,400 employees and is growing.

"We're blessed in Sarasota-Bradenton," Straw says. "We have valued-added tech manufacturing. Our success is not strictly based on the cost of labor."

He pointed out Medical Education Technologies Inc. (METI), a Sarasota company with about 100 employees that earlier this month received a $5.8 million contract to supply the U.S. Army with lifelike computerized mannequins for use in medical training.

Wolfe expects niche manufacturing, as well as military defense manufacturing, to thrive in Florida - both areas require highly skilled workers. She says the federal government won't let China or India manufacture missiles or other military weapons that could be sabotaged. Those jobs will remain in the United States.

Not that Wolfe expects mass manufacturing to return to the states, not when there are people in other countries willing to work for 50 cents an hour, she says.

The future of Florida's manufacturing industry lies in small and medium facilities - those that employ fewer than 500 people.

When big companies such as Tropicana Products Inc., Harris Corp. and Motorola move corporate headquarters to other states and cut back operations in Florida, they typically leave employees behind.

"People like to live here, and they don't want to leave," she says. "Some start smaller manufacturing operations to support the large manufacturers."

New advocacy group

Last month, the Florida Manufacturers Association and the Enterprise Florida Manufacturing Advisory Council combined to create the Manufacturers Association of Florida.

The new group, headed by Al Stimac of Metal Essence Inc. in Sanford, is an advocate for Florida's manufacturers.

"We just have to get the government on our side to make Florida a place where manufacturing can thrive," Wolfe says. "We're now more oriented toward tourism and agriculture than manufacturing."

The group has set a legislative agenda for the upcoming session (see "Legislative Agenda"). It's behind a bill to eliminate sales taxes manufacturers pay on the purchase of machinery and equipment. To qualify for the tax break, a manufacturer must show it's expanding output by at least 10%.

Wolfe contends the bill is needed to make Florida more competitive with other Southeastern states such as Mississippi, Alabama, Georgia and the Carolinas, that already offer tax incentives.

The bill passed the Florida House last year, she says, adding, "The legislators are listening. We just have to make Florida an easier place for manufacturers to do business."

The group is also working with local manufacturing associations to educate students, teachers and parents about manufacturing as a career - one that pays $42,000 a year on the average. Part of that education involves providing tours of facilities to the state's eighth-graders.

Straw says: "We have to work to create the perception in the community that manufacturing is not going to go away in our lifetime in Florida - if we do the right things to make it sustainable."

From the manufacturing of medical mannequins to the production of orange juice or missile parts, Florida needs high school graduates with a strong background in math and science, Wolfe says. She recalls one employer who told her about a new employee who didn't know how to read a ruler.

Kim Scott, executive director of Bay Area Manufacturers Association, offers these words of caution for the industry: If employers can't find qualified employees locally, they're apt to consider a relocation or outsourcing.

And Florida might lose more of its manufacturers.

Legislative

Agenda

The Manufacturers Association of Florida (MAF) was formed last month by the combination of the Enterprise Florida Manufacturing Advisory Council and the Florida Manufacturers Association.

The group's legislative agenda for this year includes a bill to eliminate sales taxes manufacturers pay on the purchase of machinery and equipment, if the manufacturer plans to increase productivity by at least 10%. The group says passing the bill, called the Florida Manufacturing Global Competitiveness Act, "will help level the playing field with Florida's competitors before it's too late," according to a press release.

Another issue on the group's agenda is the training of Florida's future employees with the help of state workforce agencies. "Unfortunately, there are still more manufacturing jobs available in this state than there are workers to fill them," the release states. "Manufacturing careers today are high tech, high paying, and high skill. MAF supports funding and programs that prepare students and workers for vocations, as well as higher education and encourages individuals to develop multiple skill sets."

MAF also seeks a tax exemption on the purchase of equipment used for research and development. "Manufacturers are responsible for almost two-thirds of all private sector R&D," it states. "To prosper and grow, manufacturers have to conduct research. Their research leads them to new, cutting-edge products, keeping them competitive in today's world marketplace."

In addition, the group urges the repeal of joint and several liability laws. "Each defendant should be fully liable for his or her own negligence, not someone else's," states the release. "Florida law should allocate financial damages according to a defendant's proportion of fault, not by their ability to pay. By requiring a defendant to only pay for the damages he or she has caused, fairness and real justice can be restored to Florida's legal system..."

The group also seeks ways to promote energy tax relief, although it doesn't provide specifics on how this can be done. The release states: "Manufacturers are intensive energy users; production of their products depends on it. Today's high energy prices and resultant high energy taxes are taking a significant toll on manufacturing operations."

MANUFACTURING JOBS

southeastern states

southeastern states

Dec. 2004 Dec. 2005

Alabama 293,800 297,400

Florida 387,100 392,200

Georgia 441,300 442,200

Kentucky 266,000 267,000

Mississippi 179,300 175,700

N. Carolina 581,800 568,800

S. Carolina 268,00 261,800

Tennessee 413,700 411,000

SOURCE: U.S. Bureau of Labor Statistics

Manufacturing job growth

Per county in major population centers in Florida.

Total Employment Manufacturing Manufacturing

County 2004 Emp. 2004 Emp. 2012 % Change

Alachua 134,504 4,369 4,604 .67%

Broward 795,423 35,592 31,425 -0.45%

Charlotte-Collier* 418,297 11,621 13,068 1.56%

Duval 501,788 29,067 29958 .38%

Escambia 140,852 6,383 6,295 -0.17%

Hillsborough 740,336 31,894 33,283 0.54%

Lee 209,759 6,456 7,164 1.37%

Leon 161,355 2,219 2,216 -0.02%

Manatee-Sarasota 331,389 19,490 21,620 1.37%

Miami-Dade 1,113,010 53,900 48,103 -1.34%

Orange 715,464 29,136 29,617 .21%

Palm Beach 603,054 23,317 23,492 .09%

Pinellas 508,648 39,710 40,627 0.29%

Volusia 174,494 9,890 10,557 .84%

Source: Florida Agency for Workforce Innovation *Charlotte-Collier region also includes data for Lee, Glades and Hendry counties. Figures for 2012 are projected.

Durable vs. Non-Durable Growth

Per county in major population centers in Florida.

Durable Durable Non-durable Non-durable

County Jobs 2004 Jobs 2012 Jobs 2004 Jobs 2012

Alachua 3,706 3,967 663 637

Broward 22,035 20,366 10557, 11,059

Charlotte-Collier* 8,527 9,795 3,094 3,273

Duval 16,794 17,910 12,273 12,048

Escambia 2,810 3,163 3,573 3,132

Hillsborough 16,784 17,183 15,110 16,100

Lee 5,077 5,679 1,379 1,485

Leon 1,553 1,576 666 640

Manatee-Sarasota 14,367 16,067 5,123 5,553

Miami-Dade 29,151 26,988 24,749 21,115

Orange County 20,330 21,006 8,806 8,611

Palm Beach 15,986 15,326 7,331 8,166

Pinellas 30,423 30,942 9,287 9,685

Volusia 7,448 7,897 2,442 2,660

Source: Florida Agency for Workforce Innovation *Charlotte-Collier includes data on Lee, Glades and Hendry counties.