The U.S. is seeing the best manufacturing jobs growth of the last 30 years. With the Port of Wilmington ramping-up infrastructure projects to handle bigger ships and quicker cargo delivery, and the Wilmington metro area adding to the local workforce with a continuing population boom, what does the future hold for area manufacturers?
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Manufacturing is experiencing a renaissance across the U.S. Is the Cape Fear region part of that good news?
RYAN LEGG: Absolutely. We have had an increase in clients in the area, with one that will be shipping about 300 truckloads into the Leland area this summer. Our other local clients have seen a spike in business as well; it is a very exciting time for the Cape Fear region.
MIKE GAWINSKI: Yes; for example, we expect our 2019 production rate from our new facility in Northchase Industrial Park to be more than 150 percent of last year’s rate when we were in a smaller facility elsewhere. Since our 2003 start-up we have seen steady growth in demand for Rulmeca Motorized Pulley conveyor belt drives. We have not had any difficulty in recruiting talented people to work with us.
JERRY COLEMAN: I think growth in new manufacturing jobs will likely be modest year over year. According to the N.C. Department of Commerce, statewide growth in manufacturing jobs (0.8 percent) is under performing compared to other industries (healthcare 2 percent, retail trade 2.3 percent, accommodation and food services 3.9 percent, construction services 6 percent).
The good news is our regions quality of place, strong diverse economy, solid infrastructure (ILM, rail, Port of Wilmington, institutions of higher education, availability of commercial / industrial sites, business support services, fintech) are all assets that can attract manufacturing activity to our area. We need to continue to actively promote all of our assets to attract new industry to the region.
PETE PETERSON: Certainly, firms like Manufacturing Methods are benefiting from the resurgence in manufacturing. With that comes the need for experienced, trained, certified, and well-paid machinists, assemblers and welders. Everyone is competing for the very best talent. This is not just a Cape Fear issue; it is a universal problem in the U.S. The National Association of Manufacturing’s (NAM) most recent survey still lists 500,000 open jobs and growing due to the skills gap workforce crisis in the U.S.
Is Wilmington manufacturing-friendly? What are some things that make it that way? What needs improvement?
GAWINSKI: Wilmington is manufacturing-friendly because of its location and established freight transportation infrastructure. We import both finished goods and component parts from our sister company in Germany; our proximity to the Port of Wilmington, major North Carolina airports, and the U.S. interstate system offers us advantages in freight scheduling and costs. An improved local traffic management system would be welcome.
PETERSON: Yes, I believe it’s very friendly. First, this is a great part of North Carolina, so you get everything that makes North Carolina what it is. In the Cape Fear Region we have fabulous weather, access to great beaches and things to do. Add the open manufacturing positions in our area and you get a great place to live and work.
COLEMAN: Yes, there are three things that made it that way for our manufacturing business: first, the region’s quality of place. For us, Wilmington is home with deeply rooted connections and relationships throughout the community. Porta-Nails, Inc. was an established business located here which we acquired in the early 1980s.
Second, having access to the Port of Wilmington was a real asset. We were able to leverage the local freight forwarding services, convenience and lower cost of shipping to our international markets. This proved to be an advantage for our business.
Third, the close proximity to institutions for higher education which included customizable vocational / technical training. For manufacturers like ours, it is essential that training resources are readily available to support a well-trained workforce. We have collaborated with Cape Fear Community College, supporting our company growth with excellent technical and soft skills training, along with UNCW’s SBTDC and the Cameron School of Business utilizing their Learning Alliance Program.
LEGG: In my opinion, Wilmington is one of the most manufacturing-friendly areas in the U.S. The eastern seaboard location is perfect because there is plenty of land in the counties surrounding New Hanover for growth, the mild weather, the port, and direct access to I-40 makes for easy for shipments in and out of the area.
What workforce challenges do manufacturers face in the Cape Fear region?
COLEMAN: Given the rapid and ever expanding advances in technology (data analytics, artificial intelligence, robotics, 3D modeling and printing, Internet of things) finding local employees that contain the requisite technical skills is an ongoing challenge for manufacturers.
Our community leaders, business leaders and educators need to collaborate with each other to focus efforts on providing the necessary educational programs, in order to keep pace with technology advances we are experiencing at an ever increasing rate, to support business and industry needs.
GAWINSKI: Staying in touch with what the local workforce wants will always be a challenge for manufacturers, not only in the Cape Fear region, but everywhere. A stable, safe, and pleasant work environment, a fair wage, and possibilities for advancement are essential. The Cape Fear region is a great place to work and live. However, business owners and managers must establish and maintain healthy work environments within their companies.
PETERSON: As I mentioned earlier the U.S has a skills workforce gap. At the national level the Manufacturing Institute is focusing on veterans, women, and youth, improving the quality of education programs and documenting best practices. Through the Center for Manufacturing Research, there are many new initiatives that partner with leading consulting firms driving critical issues in manufacturing and pushing awareness of the available jobs to companies, schools, government and organizations across the country.
In the interim, here in the Cape Fear Region we look to the community colleges and their workforce development and certification and degree programs to help fill the void. This means working in the public-school system earlier to help families and our future workforce workers recognize that there are excellent paying jobs to be had in manufacturing that do not require a four-year degree and that they are available in our area.
LEGG: For us at MegaCorp, the biggest obstacle is letting people know we’re here in town and are able to arrange shipments for full and less than truckloads for our manufacturing clients. With this being said, I think that it would be similar for manufacturing companies for getting the word out that our area is a great location for growing businesses.
Are there ways to increase the number of skilled workers in the area?
LEGG: I think internships for all ages, offering affordable training and continuing education are the best ways to increase the number of skilled workers in the area.
PETERSON: First and foremost, it’s an awareness issue. Manufacturing jobs and opportunities today are not what they were years ago. The old assembly line manufacturing jobs of the past are just that - behind us. Today’s jobs are high-skilled, competitively compensated with full benefits and provide a real job growth career opportunity.
Second, community colleges like Cape Fear and Brunswick Community need to continue with their advanced manufacturing and engineering programs, create more top notch graduates and get the word out so skilled labor stays in our region.
Additionally, workforce development programs and apprenticeship programs are ways of bringing available workers with programs that are led by industry to match the skill levels needed for today’s manufacturing.
GAWINSKI: We feel strongly that in-house training, as well as a tuition-reimbursement plan for advanced education, are essential in recruiting and retaining skilled workers. That includes production, administrative, and sales/marketing staff. Our technology is so specialized, and our market niche is so narrow, that we have consciously decided to “grow our own” talented people. But training is only part of it -- we work hard at sustaining a work environment where employee creativity is not only accepted but encouraged and rewarded.
COLEMAN: I believe manufacturers, community leaders, and educators should work collaboratively to define the skill gaps and work jointly with our middle schools, high schools, community college and university to expand educational offerings to meet these needs. Offering apprenticeships with a job placement guarantee tied to the educational program completion can help attract student’s interest in a manufacturing career.
We also need to work on changing the prevailing negative stigma of manufacturing as being dirty, blue collar, low paying, and boring assembly line type work, along with the long-held belief that you must earn a bachelor’s degree to secure a good paying job. In reality, manufacturing jobs have changed dramatically because of technology innovation.
We need to change this paradigm by communicating to kids in middle and high school that modern manufacturing is high-tech with jobs that pay extremely well. We need to create interest and excitement among our youth that a job in manufacturing is something to aspire to - making things really is cool!
What role do local K-12 school systems and area universities play in the Wilmington manufacturing scene?
PETERSON: They have the leading role in making students aware of the new opportunities in manufacturing that include careers in advanced machining, engineering and welding programs offered in our community colleges in the region. While this may be directed to some students, notably high school juniors and seniors. it needs to be made known to middle schoolers and their families there is an alternative to four-year university programs. STEM awareness and education is a big focus in America at this time and young people need to be thinking “t” technology, “e” engineering and “m” for math with an emphasis on “M” for manufacturing. STEM is alive in today’s manufacturing world and provides high paying jobs and careers for young people.
Also consider the Brunswick County “College Guarantee Program” that features entering the community college system and university with credits towards an Associate Degree and free ride in the Brunswick Community College for Brunswick County graduates.
COLEMAN: At Cape Fear Community College, we see that as part of our mission. Through our Continuing Education Division, CFCC partners with local manufacturers who are new or expanding in the area to provide on-site training for their employees through the North Carolina Customized Training Program. We’ve trained 693 people as a part of this program which is projected to create and support 304 new jobs.
LEGG: K-12 school systems introduce the youth to how manufacturing plays a role in their daily life. For example, a field trip to a manufacturing facility allows the students to see firsthand what goes into making a commodity and also shows a potential career path. Universities can take this to another level by offering internships within different departments with manufacturing facilities that they partner with.
GAWINSKI: The local educational institutions have been very beneficial to our company. Nearly two thirds of our current staff obtained degrees or are currently attending UNCW and Cape Fear Community College.
How does the Wilmington transportation infrastructure - highway, rail, ports - stack up with other parts of the country for manufacturers?
LEGG: I think for the size of our city we are spot on with our infrastructure but there is always room for improvement as more and more people move here. For manufacturers, the Wilmington area has a leg up with access to the port. I should mention too that my company, MegaCorp Logistics, is headquartered here in Wilmington, which is also a great asset to rely on for local manufacturers and we are a top 40 logistics company in the U.S.logistics company in the U.S.
GAWINSKI: Speaking from ten years of inbound freight experience, we have found the Port of Wilmington, Independent Container Lines (who offers weekly container deliveries from Europe), and Transgroup (our local freight forwarder) to offer quicker ocean freight deliveries at a lower cost than what we had when we used another major East Coast port. Since we are located on the U.S. interstate system, our outbound LTL freight is adequate to meet our needs. Although we use ICL exclusively for inbound ocean freight, we use a variety of truck freight carriers for outbound deliveries throughout the U.S. As necessary, we use the Charlotte and Raleigh Durham airports for expedited outbound and inbound air freight deliveries.
We were delighted to see the recent developments at the Port and in the Cape Fear River. Although the amount of freight we bring through the port is relatively small, we are happy to see that investments are being made in freight handling equipment and river dredging.
PETERSON: This has vastly improved in the recent years. First, the addition of lanes to and from the Cape Fear Memorial Bridge make access in and out of Wilmington significantly better. Second, there was the opening of the I-140 exchange bypass to US 17 from I-40 with exits at Mt. Misery Road and access to the Town of Leland, the Leland Industrial Park and US 74-76. Plans in the Leland Industrial Park, led by the new Leland Innovation Park nonprofit initiative, will improve an already very successful industrial and manufacturing location in our area.
Improvements made and ongoing were badly needed and the focus on improving traffic flow patterns in Wilmington is always important. The port and its many improvements about managing larger container ships, with additional and new bigger cranes and deeper channels to handle the larger vessels are also great infrastructure improvements as well as work to improve rail connectivity.
In the Leland Industrial Park we already have full services like gas, water, electrical, sewer, waste management, and recently 5G fiberoptic services from ATMC. We in this area are competitive to other areas in North Carolina and the country and ready to add more manufacturing.
Wilmington’s natural environment is an important part of its identity; how do area manufacturers help protect it?
LEGG: They can help protect the environment by using as many biodegradable products as possible. They can further help by operating their facilities with solar power.
PETERSON: We do this with the use of the most advanced manufacturing equipment that maximizes electrical, gas and water usage as well as using machines that collect unused metal for recycling. The facility we use is powered with LED lighting systems and our air conditioning systems are new and energy efficient (thanks to Florence). We don’t discharge anything harmful into the environment. In short, we keep the environment just like everyone likes and wants it to be.
GAWINSKI: We had extensive storm water catchment and retention ponds installed during last year’s construction of our new 20,000 square foot facility. In 2018 we also purchased and installed a closed-loop parts washer system to collect 100 percent of the used oil in Motorized Pulleys we have received for maintenance and repairs.
How do local Chambers of Commerce and regional development organizations help area manufacturers?
COLEMAN: Chambers of Commerce and regional development organizations are key advocacy partners for our business community. They work closely with business and industry to advocate on our behalf and ensure resources and infrastructure are in place and work tirelessly to breakdown barriers to support a business friendly ecosystem. They also actively promote our region’s economic development by effectively articulating our regions value proposition.
For example, we had a fire in our production facility which destroyed 60 percent of our factory. One of the first calls we made was to Wilmington Industrial Development to help us find a new location as it would take a year or longer to rebuild. Their efforts enabled us to relocate production operations and return to full production in less than 90 days, and we did not lose a single customer.
GAWINSKI: Chambers of Commerce and regional development organizations can take an active lead in convincing young people that acquiring a “trade” can be rewarding, both professionally and personally. Trade fairs and career seminars can provide an excellent venue to make that point.
LEGG: They help by attracting new manufacturers to the area. They also help by attracting new people to the area which can turn into new employees for the manufacturers.
PETERSON: The mission of chambers of commerce is to promote local businesses and help establish relationships with companies in their respective geographic footprint. We have numerous chambers in Brunswick county and of course there is the Greater Wilmington Chamber of Commerce. All offer events, seminars, mixers to “meet and greet” other businesses and to stay connected, make new contacts and they offer a variety of education and other resources. Each does its part to promote our area and this helps support recruiting and hiring of employees.
Is the Wilmington area’s population growth good or bad for area manufacturers?
LEGG: This is great for manufacturers because the population growth brings more qualified job applicants. With the right people, a great work environment and product, the manufacturing company will continue to grow, which will fuel our local economy.
PETERSON: I believe it’s good if managed properly. We are enjoying some of the greatest population growth in the country in our area, which is great but there needs to be other areas of attention and growth to support the many new people. There needs to be community development that includes affordable housing and apartments, general community support services, access to all forms of retail, local businesses services, restaurants, entertainment options for weekends with family, and of course the management of our beautiful beaches.
GAWINSKI: Wilmington’s population growth is encouraging for area manufacturers because it indicates that the local economy is healthy. That, in turn, makes Wilmington an attractive place for potential employees to live and work. A couple of us here at Rulmeca Corporation relocated our families to work in the Motorized Pulley industry. The climate, the beach, the quality of life, and conservative values were factors in drawing us to Wilmington.
One thing that concerns us is that local real estate development (especially houses and apartments) often outpaces road building and traffic management systems serving the area.
How is manufacturing in the region different today than five years ago?
LEGG: It has increased.
COLEMAN: I think the most significant change has been the continued decline in the unemployment rate and increasing number of baby boomers entering retirement. This combination of events has resulted in a real labor shortage challenge for manufactures. In addition, we are seeing rapid advancements in technology (AI, big data, robotics) which is putting added pressure on finding qualified candidates to support manufacturing high-tech job needs now and in the future.
GAWINSKI: Although we’ve not done research to validate it, we think there is more manufacturing in the region than there was five years ago. For example, when we decided to lease a larger commercial property in 2017 we couldn’t find one. That’s what prompted us to negotiate a lease on a new building. Additionally, we have found that our local vendors are booked out. This, of course, means that business is good for local fabrication and machine shops.
PETERSON: For too many people today, the picture of manufacturing goes back to large noisy smokestack plants with large assembly lines. This is no longer the case. To be competitive in global manufacturing, U.S. companies like ours, have moved to sophisticated computer-controlled manufacturing machines managed by skilled machinists, assemblers and welders. These machines provide precision parts and assemblies that offer unmatched accuracy and detail and do it consistently and efficiently.
Modern “just in time” processing systems maximize operations and productivity yielding greater output and profits. Robotics and automation are part of today’s manufacturing; working side by side with workers who increasingly oversee operations and assume a greater role in the quality control and assurance of the manufacturing process.
What does the next decade hold for manufacturers in the area?
GAWINSKI: In our small market niche, we predict a bright future because our technology meets a basic need. Plants, mines, quarries, and food processing facilities have used conveyors for more than 100 years and are likely to continue doing so. Although we began manufacturing Motorized Pulleys at our German production center in the early 1950s, many customers in the US are still unaware of their benefits. Therefore, we find ourselves selling what appear to be “new inventions” (i.e. hermetically-sealed and internally-powered conveyor drives) even though we know they have stood the test of time for more than 60 years.
COLEMAN: I believe there are two significant areas that will affect manufacturers over the next decade, one being the accelerating pace of technology innovation and disruption. As we enter into the fourth industrial revolution over the next decade, we will see significant advancements in AI, the Internet of Things and Systems, and smart technologies that will interact autonomously with our customers, suppliers and production operations.
In other words, manufacturing operations will be fundamentally different. Thus, we must be nimble and quick in our strategic planning and plan execution in order to keep pace and remain relevant to our customers.
Another area I see affecting manufacturers is the potential disruption to the supply chain due to current domestic and geopolitical uncertainty, particularly as it relates to open markets and global trade. Movement toward policies like increased tariffs which may limit trade create uncertainty while adding cost and risk, potentially disrupting supply and distribution channels manufacturers depend on.
LEGG: The next decade holds a lot of growth for manufacturers in our area. I believe many more facilities will catch on to the slice of paradise we have here in southeastern North Carolina and open up their HQ here or an additional branch in our location. It is a perfect blend for business and pleasure. For the facilities here, I think a lot of them will see rapid growth due to the increasing talent pool.
PETERSON: North Carolina has a very large number of successful manufacturers and they all are using new and more efficient manufacturing processes. There will certainly be more technology and even bigger, better, smarter and faster machines. The companies, already in precision manufacturing, are making investments in their companies, operations and people that will help them grow. Smarter machines, continuous advancements in technology and a skilled, trained and well-paid workforce mean a better future in the US and our area in manufacturing.
Smarter and better educated and trained workers remain the key to being a manufacturing leader in this country. This means that all levels of education, from middle and high school and community colleges and universities will continue to promote manufacturing as an excellent career opportunity and will need to continue to better integrate manufacturing best practices in their workforce-related associate certificate programs and curriculum.
What are three things our community can do to draw more manufacturing to the Cape Fear region?
COLEMAN: We can continue to make investments to enhance our quality of place like environmental stewardship, access to quality education and healthcare, reduction in crime rate, and easing traffic congestion. Investments in infrastructure need to continue for ILM, the Port of Wilmington, rail and road enhancements, and broadband internet access, in our rural communities and under-served urban areas. And we need to address workforce needs and any skills gaps in support of existing business and that will attract new organizations and industry to the area.
LEGG: Advertise in areas of the country that have a strong manufacturing presence. Referral incentives. Tax incentives.
PETERSON: I would say produce more ready well-trained skilled workers. Through efforts in the community promote manufacturing as a real career opportunity for everyone, male and female, through education in public schools and the community college systems.
Industrial parks in the area should be improved to meet today’s model of advanced manufacturing parks. Besides available and affordable land, there needs to be improved roads and sidewalks, better landscaping, running and biking paths, lunch and meeting locations, food truck traffic, periodic park activities and more. These are things that today’s younger generation and future workers factor into their decisions for job and career selection.
It is also important to have greater local awareness of the great things that are happening in manufacturing in our area. The Greater Wilmington Business Journal does a great job through their weekly newspaper and other publication, the WilmingtonBiz Expo each year, and insightful articles from local professionals like the INSIGHTful DISCUSSIONS series.
GAWINSKI: Infrastructure improvements (e.g. roads) are essential in drawing manufacturers to the area. Without coordinating real estate development and traffic management we run the risk of deteriorating the quality of life in our region.
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