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Major concerns for Minnesota manufacturers include health care costs and finding qualified workers
Monday, May 13, 2013

By Jennifer Kotila
Staff Writer

“Health care costs have become a really overwhelming concern,” said President of Enterprise Minnesota Bob Kill, noting that when most manufacturers opened for business, they were providing 100 percent of health care coverage for their employees.

Kill presented the 2013 State of Manufacturing survey findings to local businesses May 3 at the Meeker County courthouse. Other top concerns manufacturers noted in the survey included “Washington gamesmanship” (the uncertainty in Washington regarding the budget and taxes, and government policies and regulations), and finding qualified employees.

“The concerns with rising health care costs, the uncertainty with Washington DC, and finding and keeping qualified employees did not come as a surprise,” said American Time & Signal marketing manager Ronda Anderson. “As a small manufacturer in central Minnesota, American Time & Signal shares in those concerns.”

This is the fifth year Enterprise Minnesota has conducted the comprehensive poll, and each year, health care costs have been the number-one concern for manufacturers.

“They really don’t know the rules and regulations coming at them (from the federal government), and health care costs have not changed,” Kill said.

“Obama was telling employers how much they were going to save on insurance, but now it is unknown how much it is going to go up,” noted Jim Grossman of LifeStar Business Services in Dassel.

Providing health care has also become the most important factor in recruitment, Kill added.

Making its debut as one of the top five concerns for manufacturers was “Washington gamesmanship,” noted Kill.

“We were not surprised that it was high on the list of concerns, but might have been surprised it was this high,” he said.

About three-fourths of the manufacturers surveyed said the policies coming out of Washington DC will affect their bottom line, Kill added.

“The vast majority of the issues facing manufacturing, and business in general, are problems created by the federal and state government,” said Meeker County Commissioner Mike Housman. “I see minimizing local regulation and taxes as our best tool in accomplishing [manufacturing and business growth in Meeker County].”

The ability to find qualified, skilled workers also made the top of the list of concerns. However, Kill noted that Minnesota is a lot further ahead in solving this problem on a local basis than other states.

“Kill’s presentation could have been given back in the 1970s,” Grossman noted. “Things just haven’t changed. The biggest problem in manufacturing is finding good, qualified people.”

He shared an example of a program he worked with when he was a controller for a manufacturing group that topped out at more than 200 employees.

St. Paul Community College, formerly St. Paul Technical and Vocational Institute, set up the training to match exactly the jobs Grossman had to fill.

“When one of their students came in for a job, I just had to show them where the coffee pot was and turn them loose,” Grossman said. “They were trained on exactly the same machines, computers, and materials that we were using. Very successful for all concerned.”

Most manufacturers said they want workers who have technical training and experience.

“That’s nice to say, but it is not possible,” Kill said, noting that employees with two-year degrees have to be allowed to gain the experience needed.

Rounding out the top of the list of concerns for manufacturers in Minnesota are:

• the cost of employee salaries and benefits, not including health care costs;

• increased competition from foreign sources; and,

• managing supply chain relationships.

“The most important take away (from the survey) is the fact that manufacturers have a significant knowledge pool, and sharing common experiences, challenges, and successes in a networking environment is beneficial to everyone involved,” Anderson said.

For more information about the State of Manufacturing survey, click on the link under featured links at www.dasselcokato.com.

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