Harry Moser had already anticipated a U.S. manufacturing comeback in 2013 when I started telling stories of American manufacturers. He was tracking how many jobs companies planned to reshore in support of U.S. production, and today is among the nation’s top experts on reshoring because the trickle he reported early on became a tsunami.

It’s good to be right.

His new report measures more of the same: Moser’s Reshoring Initiative (RI) tracks the number of manufacturing jobs U.S. companies plan to reshore, as well as foreign direct investment (FDI) in domestic manufacturing, and RI’s “current 2022 projection of jobs announced is around 350,000 — another record, up from 260,000 in 2021. If the projection is achieved, 2022 will bring the total jobs announced since 2010 to over 1.6 million.” (Kentucky, North Carolina and Georgia are the top three destinations for jobs, all with large EV battery investments. Texas has dropped from #1 in 2021 to #13. Arizona ranks #16.)

It’s no mystery why companies want more U.S. manufacturing: Doing business in China (the source of 44 percent of reshoring announcements) is risky, offshore supply-chain bottlenecks are wreaking havoc, and consumers want stuff made in the U.S. Brand promises matter.

Companies are also just doing the math — with Moser’s help. RI’s Total Cost of Ownership (TCO) tools are helping many companies factor in all the expenses involved in offshore manufacturing operations, not just price (cost of production.) As the report notes, “The Chinese factory price is, on average, 30 percent lower than the U.S. price,” but “by switching to TCO, companies will see that about 20 percent of what they now import from China can be sourced domestically without raising prices or cutting profits.”

How important is TCO? Moser notes that historically, most companies that left to find cheaper factories offshore just didn’t do the math — in industries like machinery, transportation equipment, and appliances. “More recently, activity has shifted to include more essential products which the U.S. government should have recognized as too essential to rely so heavily on imports, including electric batteries, semiconductors, PPE, pharmaceuticals, and rare earths,” the report concludes.

But demand for more U.S. manufacturing runs headlong into what Moser describes as America’s “deindustrialization” policy — a mix of anti-manufacturing policy outcomes that stand in the way of more domestic production. He’s leading the charge for a “permanent industrial policy” that would “level the playing field enough that the companies would decide to reshore in their own self-interest.” Here’s Moser’s Congressional testimony to that effect.

His roadmap is part of a new national narrative that’s identifying ways to lower barriers to growing U.S. manufacturing. His prescriptions would:

• Train a new — and much larger — skilled workforce

• Reduce the value of the U.S. dollar

• Maintain low corporate income taxes and capital investment breaks

• Lower healthcare costs to reduce burden

• Make the Section 301 tariffs permanent, or, better, replace it with a border adjustment tax (BAT) on all imports from all countries

• Eliminate other sales taxes and use the extra revenue to fund Social Security and Medicare

• Cooperate with Mexico and Canada to attract work from Asia to North America

• Fill supply-chain gaps in the U.S. — and aggregate demand to drive the domestic supply chain

While Moser’s roadmap may end up being his true legacy, it’s also worth asking how realistic it is to assume that key pieces of the plan are likely to cross a finish line. For example, how likely is it that Congress would agree on a strategy to lower the value of the U.S. dollar and implement tariffs to specifically benefit manufacturing?

It’s fair to say that U.S. policymakers — and most U.S. multinational corporations — oppose tariffs, border taxes, and industry-targeted VATs of any kind. You’re normal if you support “free trade” and seen as a bit unconventional if you don’t. It’s deeply ingrained: Most business leaders, politicians, and chambers of commerce and trade associations oppose tariffs. Because most U.S. corporations do.

Instead, America’s new industrial reality will likely be shaped by us, by families and young people and employers who decide manufacturing is an occupation worth pursuing. The U.S. will need more than 3 million new, highly skilled manufacturing employees in the next decade, to meet the demand Moser anticipates and sustain a post-global industrial economy.

RI’s report touches on a promising trend: “Currently, reshoring and FDI are continuing to add more high-tech jobs than low-tech ones, again driven by the essential products push. . . . . The challenge is to upskill our workforce so that more of them can work competitively on more highly automated production of lower-tech products.”

I anticipate a pivot to this seminal point in future RI reports — that automation and technology transforming U.S. manufacturing will catalyze employment growth in the sector, not diminish it, which is today conventional wisdom. When U.S. manufacturing companies can compete with their technology counterparts for STEM students, we will have won.

We might look back on one small nugget in Moser’s 2022 Congressional notes as a clue to what might transpire in the years ahead — Utah’s new Manufacturing Modernization Grant, a modest $10 million fund designed to help “establish, relocate, retain, or develop the manufacturing industry in Utah.” If companies use the money to invest in new equipment, assets that act as a magnet for new talent, others will follow.

More on the challenge and promise of transparent supply chains, and their potential to fuel more reshoring, in future editions.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com.

I’ve written about the manufacturing supply chain since 2013, and today believe the “next big thing” in America’s latest (and ongoing) industrial revolution — a.k.a. Industry 4.0 — will be the interconnection of the U.S. supply chain.

The big breakthrough is AI-enabled search that will help manufacturers find ideal suppliers. In May, I bet the future of CompanyWeek on the idea, joining forces with Sustainment, the ascendent tech startup developing an advanced sourcing and connectivity software platform.

It’s left to all of us to nurture a growing community of suppliers, and our new partnership will enable us to showcase more companies and people, but to also lean into our role as a champion for domestic suppliers. For me, it will be more of the same.

In early 2015, I took note of companies leaving Colorado in search of suppliers. “Gold Star is a good example of how much manufacturing growth in Colorado will pivot on supply chain development,” I wrote. “It’s why manufacturing is developing unevenly across industries and why the economy will be well-served by efforts to shore up resources that will drive manufacturing businesses.”

Our clarion call was underway by 2016. “Want to engage in a real conversation to advance U.S. manufacturing?” I asked after the election. “Be an advocate for the domestic supply chain so that U.S. manufacturers have everything they need to make things here, including labor.”

In 2018, I encouraged communities to “assess how well-matched target industries are to local and regional business assets,” and “whether steps can be taken to address supply-chain gaps, or whether a pivot to better-matched manufacturing industries might be a better plan.”

By January 2021, my optimism had turned to pandemic-fueled exasperation. I complained that: “American companies in part funded China’s world-class supply chain. Cheap labor and short-term profits were too hard to pass up. Now it’s up to us to bring it home. Let’s earmark substantial public sector support to hasten its reshoring as we take matters into our hands.”

But during the pandemic, we launched SCoP, short for “supply-chain portal”, to provide more transparency into the growing community of manufacturers featured in CompanyWeek, and to enable easier and more informed connections between manufacturers and suppliers. We put words into action. But it wasn’t great.

By January of this year, in a column entitled “Supply-chain scramble: the race to connect you with suppliers and OEMs,” I acknowledged others were in the game. Today, multiple players are striving to better connect the U.S. manufacturing economy, from Xometry/Thomasnet to Mfg.com to Connex Marketplace.

But Sustainment impressed me most, and by May, we’d joined forces. Here’s why.

First, our shared vision is that the community, not the technology or data, is most important. As I discussed a partnership with CEO Bret Boyd and the Sustainment team, the narrative always returned to one thing: you. Today our community is 50,000-plus CompanyWeek readers and technology users in 20,000 manufacturing companies across the West — and growing – connected by stories and a common mission but not yet by advanced tools and software.

That will change quickly. Sustainment has been building software and enabling tools since 2020 to help U.S. Air Force customers in Oklahoma and Texas reimagine procurement in what is a massive defense supply chain — millions of parts, components, and products. It’s a “local and regional first” development strategy: locate and map the closest suppliers to start.

It’s a tech foundation that I trusted would be the best match for CompanyWeek’s audience. Our goal is to bring together our community with Sustainment technology to connect with each other, meet new people, find new buyers and providers, publicize new processes and capabilities, and otherwise help you be successful. Today, we’re in this together.

Our approach is to perfect the platform for suppliers and contractors in the machine-shop economy, by focusing on supplier processes, then expand the platform into other key manufacturing industries beginning this fall. Every small business machining, fabricating, or finishing parts or products should be listed in the Sustainment platform now — and we can help.

Join the platform. There are no fees. Take it for a drive. Tell us where we can improve. I’m confident we’re building on a solid foundation.

Join here.

We’re not alone in this quest, nor should we be. If we’re successful, manufacturing will have taken a momentous next step — as a prelude, it turns out, to Industry 5.0 – an era that “recognizes the power of industry to achieve societal goals beyond jobs and growth to become a resilient provider of prosperity.”

As we’re a public benefit corporation, we’re ready for that, too. More on that in future editions.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com.

The narrative around the health of California’s economy changes depending on where you are. But as U.S. manufacturing’s fortunes rise, so too does the outlook for California’s economy. Yes, the state may earn its notoriety as a high-cost place to do business, but if your company makes things, California’s production ecosystem is a calling card.

That’s especially true in aerospace, and the companies atop California’s bluechip sector are determined to remind anyone who listens that the epicenter of U.S. aerospace manufacturing tilts decidedly West.

Alongside the California Manufacturing and Technology Association (CMTA) and the Aerospace State Association (ASA), California’s largest aerospace companies are hosting Aerospace Day, August 3, in Sacramento. The program is organized through CMTA’s Aerospace Defense Alliance of California (ADAC) committee.

We recently caught up with Joe Ahn from Northrop Grumman, Mark Taylor from Boeing, and Eric Fox from Lockheed Martin to talk about California aerospace and the event.

CompanyWeek: Tell us what’s at stake here. Why an Aerospace Day, and what are you trying to accomplish?

Joe Ahn: I’d begin by just providing a 50,000-foot view of the aerospace industry in California. The numbers speak for themselves: $100 million in economic activity, 511,000 high-paying jobs, $11 billion in wages and benefits, $2.9 billion in payroll taxes, and $7 billion in state and local taxes paid.

As for Northrop Grumman, we’re the largest aerospace organization in the state of California, with 32,000 employees in 120 locations. And like my colleagues from Boeing and Lockheed, we make everything from military aircraft to long-range strikes, hypersonics, satellites, and components. Probably our most recognizable system right now is NASA’s James Webb telescope. We’re happy to say it was built, manufactured, and designed here in California.

Mark Taylor: Boeing also has a rich history in California today, with about 13,000 employees at our four main sites and dozens of other smaller sites including a couple high-profile joint ventures and subsidiaries.

We have the world’s largest satellite manufacturing facility, we provide 24/7 support to 14,000 in-service airplanes for 900-plus operators worldwide, and we can’t forget about all of the design and engineering support our teams in California provide across our enterprise. We are also building for the future in areas such as autonomous systems, all here in California.

Just to circle back to the event, Aerospace Day is to remind the Capitol community how important aerospace is. Joe did a nice job of summarizing the high-level statistics, and they open people’s eyes to the fact that aerospace, as an industry in California, is larger than entertainment and agriculture combined!

I think there’s a misconception that aerospace has left California, and that couldn’t be farther from the truth. In addition to all the big companies that are still here with a huge presence, Boeing has more than 2,200 suppliers in the state of California, and it’s the number two state in the country in terms of our supply base, both by dollar value and by number.

Far from being gone, aerospace has a huge presence here. We’re the backbone of the economy. And we’re here to ensure the future is equally bright for aerospace in California.

Eric Fox: Lockheed Martin has been in California since 1912, flying a seaplane in San Francisco Bay. We’ve got about 10,000 folks in California as well, prominent in Sunnyvale for our space systems and, of course, the iconic skunkworks in Palmdale. That was in Burbank, California, after World War II. Across our footprint we’re also working on batteries and energy sources for the future.

To amplify what Mark said to give you an idea of the scope of the F35 program — which Joe Ahn (Northrop Grumman) is a partner on and is helping California employment there as well — Lockheed has more F35 suppliers in California than our next four states combined: Texas, New York, Florida, and Connecticut. And if you just saw the headline, we think we got a spit-and-a-handshake deal for 375 more F35s with the federal government. And then, of course, we’re selling them internationally quite quickly given what’s happening in Ukraine. So, it’s a long-storied history in California that’s getting even better. As Joe mentioned, hypersonic (weapon systems) are going to be born and raised in California; everyone’s competing on that. We’re adding jobs; we’re wide open for business.

And also, even though they’re not on the call, I’d put a plug in for our good friends at Raytheon, who’ve announced they want to hire another 1,000 people in their El Segundo facility. California is thriving and growing because of the leadership of Governor Gavin Newsom and Dee Dee Myers at CalCompetes. California is the birthplace of next-generation aerospace.

CW: I wanted to touch on Mark’s comments about Boeing’s rich California supply chain. It’s obviously integral to your operations. I’d assume the care and feeding of America’s top aerospace supply chain is important?

Joe: Yes! Without our suppliers, we wouldn’t be able to manage back to the OEMs. In fact, depending on what systems and products you’re talking about, sometimes half the work is actually done by our supply base. It’s very important.

Just to bring CMTA into the conversation, the reason we have an affiliation and partnership with CMTA is that a lot of our suppliers don’t have the ability to articulate or share their thoughts about public policy that are important to them and us. By working through CMTA, we’re able to amplify to policy makers those things that are important to us and, by default, to our suppliers. We talked about hiring and recruiting. I don’t think there is any question that the challenges we’re facing with workforce are shared by our suppliers.

In the next 10 years, at Northrop Grumman, we’re going to lose half our workforce. We hear similar concerns from our supply chain. So, it’s very important that the supply chain remains robust to achieve our goals of supporting civil space, the military, and other applications.

Eric: Workforce development is obviously a focus within all our states. With California having the worldwide leader in higher education in the form of the University of California system, we’re going to find our engineers here.

But you also have to have the people to put together aircraft, hypersonics, and whatever the next generation “thing” is. What we’ve found is that we also have to partner with community colleges — not everybody needs a four-year degree. We need to work with these entities to get the curriculum we need to start the feedback pipeline.

As our workers start to mature out, we’re working with CMTA through ADAC to lay the groundwork for the workforce of the future. And today it’s a different game. These are well-paying, high-quality, long-lasting jobs. The days of a dirty factory are gone. Everything today is high-tech, high-skilled — including the defense industry in California.

Mark: Just to mention ADAC again, in addition to regulatory and competitiveness issues, workforce is one of the key things we focus on. There’s a lot of competition for skilled labor in California. We’re spending a lot of time, as an organization, at the high-end of the engineering spectrum as well as the trained, hands-on workforce we’ll need to build things in California.

REGISTER for Aerospace Day here>>

Bart Taylor is publisher of CompanyWeek and the CA Manufacturing Report. Reach him at btaylor@companyweek.com.

If workforce is manufacturing’s certain and persistent challenge, the vagaries of industry supply chains and uncertainty they’re causing is today the sector’s biggest headache.

As we noted in the first part of this analysis, 170 CompanyWeek interviews in 2022 found supply-chain woes have overtaken workforce as the top challenge cited by manufacturers:

2022 Q1 + Q2 | Top 5 Challenges

1. Supply Chain 45%
2. Workforce 26%
3. Managing Growth 15%
4. Market Uncertainty 9%
5. Pricing 9%

One narrative suggests relief may be just around the corner, that interest rate hikes are having the intended effect of lessening demand and already are removing some of the “scarcity and urgency” that has plagued supply chains in recent years.

Manufacturers in our community aren’t so sure.

Voices

Uncertainty about the future is still a prevalent sentiment. “Just trying to predict what’s coming” is Dave Staheli’s biggest challenge. “With all of the supply chain issues, it’s so hard to ramp production up in a short amount of time, so we’ve just had to do what we can do,” says the CEO of Staheli West, a Cedar City, Utah-based manufacturer of haybaling equipment. “It’s kind of like sticking your neck out. You’re waiting for it to get chopped off or you might do really well. With inventory costs and all those kinds of things, you do have to be a little wise in the world we’re living in right now.

“Things that were a few weeks lead time are now six or eight months,” he continues, “things that were three months are a year out now, and things that were six months are two years out now. So we are just really having to look way ahead on our purchasing — which we’re doing. We’re actually getting along very well compared to some of the other manufacturers. We’ve been able to deliver machines in a pretty timely way, a little bit of delay but not too bad.”

Tracy Latham, CEO of Phoenix-based Latham Industries, is also taking chances with her namesake printed circuit board manufacturer. “I have customers that we’ve done business with for a long time. I know what they order, so I will take risks,” she says. “I’ll watch what items are becoming scarce, and I will buy extra material for them. Or we’ll have a conversation and work on alternatives together.”

Companies often have to think outside the box to get customers what they need. “I have a smaller customer with a wonderful product,” Latham recounts. “I’ve got components that I ordered for him over a year ago that still haven’t been delivered. To keep his business up and running, we’ve salvaged parts off of old boards he had that never worked. And then we had another customer who needed a microchip part that kept getting delayed. I was looking at another product of his and realized we could take chips off of that board and put it on this one. So, we did it.”

In Payson, Utah, Sunstone Welders CEO Jonathan Young echoes the need for agile product development of its mico-welding solutions. “Trying to grow while having a global supply chain crisis is difficult. We’ve had to redesign some of our boards because of the chip supply,” says Young. “Our current chip was running out, so we’ve had to redesign our boards with newer chips that are more readily available.”

More of the same from Ben Ashe, VP of Colorado Springs-based pump manufacturer MDM: “We’re seeing materials just completely disappear out of the supply chain,” he says. “Pretty unique products disappear out of the supply chain with no information about when they’ll come back in. That’s a challenge. We’ve had to bring chemists in and plastic formulators in to try and figure out how to solve this one process with this one material that we’ve normally used — which is a good thing. If you can respond well to those things, you give yourself a buffer and you’re not reliant on any one thing.”

In Fort Worth, Texas, Renfro Foods’ co-manufacturing business has enjoyed a steady stream of new customers as food brands adapt to supply-chain disruptions fueled initially by a pandemic. “People have been changing co-packers for one reason or another — and without being mean-spirited, we’ve benefitted from that,” says CEO Doug Renfro. “We’re very honest, we’re transparent, we try to avoid surprises, and if we screw up, we’ll tell you. Nobody saw the pandemic and supply chain issues coming. With the new machinery that has allowed us to produce faster, I’d love to say that we were brilliant to set ourselves up for these opportunities, but we were just lucky.”

Is food a potential bright spot? Naturally Boulder Executive Director Bill Capsalis sees a glimmer of hope. “Sourcing and supply chain are the most pressing challenges facing food manufacturers,” says Capsalis. “This has been easing up lately, but it still presents problems. Between the war in Ukraine and fuel costs, brands have to make some difficult choices right now.”

Including, says Capsalis, how to navigate inflation-fueled ingredient prices. “It’s a related challenge for all the companies — increasing costs which may necessitate raising prices at a wholesale level, and accordingly at retail. Everything is costing more at the grocery store: Brands are increasing their prices, and so are retailers — it flows downhill.”

Materials costs are up 30 percent since early 2021 for chairlift maker Leitner-Poma of America in Grand Junction, Colorado, and the company is also passing some of that onto customers. “That’s a big, big cost to pass on, but I think it’s just the way of the world right now,” says President Daren Cole. “Even with those cost increases, we’re seeing substantial growth in our marketplace. This year, the market will be well over $300 million.”

Yet disruptions are still limiting capacity. “We hit a point where we stopped taking orders,” says Cole. “It was really just to stay ahead of the supply chain and make sure we could deliver on what we sold.”

Rising costs also bedevil Windsor, California-based Solectrace, where CEO Mani Iyer is also dealing with rising costs. “The costs have gone through the roof at about ten times. I used to pay between $2,000 and $3,400 for a container. Now you’re talking about $25,000. Labor is also a constraint. It’s not easy to recruit people, but we’re doing our best. We have gone from two [employees] in July 2021 to 50 as of last month. Our plan is to take it to 100 by the end of the year. So, we are certainly recruiting much faster as there is passion for joining Solectrac.”

Demand is also still sky-high for outdoor industry standout Yeti Cycles of Golden, Colorado, even if a normalized supply chain remains wishful thinking. “I think supply chain is going to continue for a couple years being a challenge, whether it’s working with manufacturers overseas or it’s trying to get the steamship lines to get your stuff to your door at a decent time with a decent rate,” says CTO Steve Hoogendoorn. “Currently at the factory in Golden here, it’s really tough to find employees. Finding people who can do the job is not that easy right now.”

It’s fitting that any analysis of supply woes concludes with mentions of its most elusive component.

More soon on both challenges.

Bart Taylor is publisher of CompanyWeek. Email him at btaylor@companyweek.com.

Across CompanyWeek‘s network of manufacturing reports, writers fanned out in the first two quarters of 2022 to interview 170 manufacturers in multiple industries.

Executives paint a picture of high demand for products and services with operations challenged by supply chains and workforce. The net positive sentiment corroborates the June 2022 Purchasing Managers Index of 52.7 that placed the sector in expansion mode (a score of 50 and over). In the same Institute for Supply Management survey, an “overwhelming majority” of manufacturing companies also said they were hiring.

But the search is tough: The U.S. Department of Labor counted 797,000 unfilled manufacturing jobs in May 2022. Posting a job and finding a qualified employee are two different things.

Here’s data summarizing the top challenges and needs gleaned from CompanyWeek reporting – along with voices from featured companies.

The workforce barrier — and opportunity

Here’s a snapshot of manufacturing sentiment relating to challenges:

2022 Q1 | Top 5 Challenges

1. Supply Chain 39%
2. Workforce 29%
3. Managing Growth 18%
4. Pricing 11%
5. Market Uncertainty 10%

2022 Q2 | Top 5 Challenges

1. Supply Chain 50%
2. Workforce 24%
3. Managing Growth 11%
4. Market Uncertainty 8%
5. Pricing 8%
6. Shipping/Transport 8%

2022 Q1 + Q2 | Top 5 Challenges

1. Supply Chain 45%
2. Workforce 26%
3. Managing Growth 15%
4. Market Uncertainty 9%
5. Pricing 9%

As pressing as the supply chain challenge is today, workforce is manufacturing’s sustained and stubborn need.

2022 Q1 | Overall Top 5 Needs

1. Workforce 49%
2. Finance/Funding 22%
3. Real Estate/Space 20%
4. New Customers 12%
5. New Suppliers 9%

2022 Q2 | Overall Top 5 Needs

1. Workforce 50%
2. Finance/Funding 20%
3. Real Estate/Space 20%
4. Marketing 16%
5. Equipment 13%

2022 Q1 + Q2 | Overall Top 5 Needs

1. Workforce 49%
2. Finance/Funding 21%
3. Real Estate/Space 20%
4. Marketing 12%
5. New Customers 11%

One in four companies cite workforce as their top challenge — and fully half cite it as their top need.

Voices

“We’ve been working hard to try and build our staff,” says Hunt Dabney, CEO of HDA Technology in Lake Forest, California. “That will be a limiting factor if we don’t see some improvement. But I’ve talked to a lot of other guys with businesses, and I think an awful lot of engineering and software development people with high levels of expertise are in their forties and fifties. And I think a very large number of them have discovered that they could rearrange their lives, simplify them, and not go to work anymore, but just retire early or freelance remotely from somewhere else. A whole lot of the labor pool that we would normally draw from seems to have gone off the market.”

Colorado Tech Shop’s Heidi Hostetter echoes the sentiment. “Employees want flex time, they want to program machines remotely, they want us to accommodate things that we’ve not had to in the manufacturing realm,” she says. “Unless we diversity into that space, automation and tech won’t matter, to be honest with you.”

“Supply chain and labor — that’s really stunted our comeback,” says Ryan Christensen, CEO of Christensen Industries in Salt Lake City. “We’d like to be bigger. I think our customers have more volume for us, but we have to turn certain things away because I can’t support it with the current labor force that I have. And material lead times are pushing things so far out that sometimes those projects just get put on hold — not because we can’t do it, but because our customer says, ‘Well, we’re going to go focus on something else.'”

Christensen’s needs are straightforward: personnel. “Quality management folks, fabricators, assemblers — A to Z,” he says, noting that he could use 10 new hires immediately and “another 20 or 30” in the second half of 2022.

If quality is the calling card for most manufacturers, companies are also concerned how labor is impacting their ability to maintain it.

Cabinet-making is a labor-intensive process, and for co-owners Gabe Powers and Stephanie Lemon of Abacus Cabinetry in Denver, finding the right employees to do the job has been challenging. “We can cut as many parts as required on the machines, but at the end of the day, we need people with experience to make sure the quality stays at the highest level,” says Powers. “Keeping good people around is one of the biggest challenges I see.”

In a tight labor market, retaining talent is as important as new hires.

“In our company, we train our own people and have very low turnover,” says Maya Royberg, co-founder of Precision Group in San Antonio, Texas. “Some of them came to work for us at the beginning when we opened our doors, and they’re still here.”

That said, recruitment and hiring has proven increasingly difficult for the company in recent years, she adds. “For the longest time, it was: Find a toolmaker. Training a toolmaker is a tedious process, so we decided to go more with sophisticated, computerized equipment. Machines are so powerful that I don’t need many employees.”

Professional development is top of mind for VB Cosmetics founder Vivian Valenty in Chandler, Arizona. “With COVID, the difficulty of finding skilled workers is tougher,” she says. “Some of the staff that we hired do not have experience in our industry or the tasks we have available. We need to train them, and we’re getting help from the Arizona MEP — that’s the Manufacturing Extension Partnership.”

“I think the focus for us is willingness to train now,” says Dalyon Ruesch, CEO of La Verkin, Utah-based Vitalpax. “We’ll find folks with aptitude, whether they’re coming out of technical schools, even high school graduates, people that are interested in this type of work, we bring them in and say, ‘We’ll train you on the job.’ We’ve had to offer better benefit packages, better salaries, things like that to try and lure folks in here. It’s good for the workforce and the guy looking for work.”

“Finding talent to run equipment is challenging, primarily because there’s not as many guys who are supplement manufacturers here in southwest Utah as there might be in New Jersey,” says Ruesch. “A lot of this technology is not just open to the public — you can’t just go find a class on it. You have to have connections and you need to have a teacher, a master, someone you can be an apprentice to.”

Technology as a catalyst for employment

Automation, long viewed as a threat to manufacturing employment, may be emerging as a catalyst. Companies investing in new equipment to automate operations are getting ahead in the workforce competition.

San Leandro, California-based Scandic operates in the Tesla supply chain, and president Hale Foote describes a scenario playing out across the sector. “Scandic started 53 years ago with mechanical spring coiling machines,” he says. “The technology is based on cams and gears, and adjustments require a technician to stick their hands into a dark greasy gearbox. The number of younger employees who are willing — or even want to learn — to do that is limited. Fortunately, the very same equipment manufacturer now makes CNC machines that use identical end-point tooling but most adjustments are made via computer with a screen showing the parameters. We have installed this technology, and this will be a much easier position to hire for.”

In Orem, Utah, laser-cutting pro OSH Cut may be a case study of the positive effects of Industry 4.0 on workforce prospects. “We combine high automation with high pay so we can get great people,” says co-founder Caleb Chamberlain. “We’ve had zero problems attracting the best of the best to run the operations on the floor.”

A higher level of acumen means higher wages, but it’s a price Chamberlain is willing to pay. “We’re paying our people often as much as two or three times more than what the median pay is in this industry for the job they’re doing,” he says, a bonus given the fact the company will be hiring about 12 more employees in the coming months.

John Cornell, founder of Surprise, Arizona-based Atec Engineering, sees other advantages. The company just purchased a new Hyundai CNC lathe with a sub-spindle and bar feed, which should improve overall efficiency. Cornell says, “We got every bell and whistle we could get with the machine, and that’s a huge addition for us. We’re still installing it right now, and I’m hoping it’s going to increase our capabilities and take a step toward a certain amount of automation, because it can be very hard to find people when you need them. I think that’s part of the answer going forward.”

In Frederick, Colorado, Xpect Solutions President Walt Papierski sees another upside to investing in automation — the lack of skilled labor across the industry is driving sales. “We have companies come to us and they say, ‘Well, we used to build all of our enclosures and panels here, but we don’t have the time or the labor to do it so we send it out.’ A lot of big companies are starting to look at that model.”

More on the challenges associated with snarled supply chains next time.

Bart Taylor is publisher of CompanyWeek. Email him at btaylor@companyweek.com.