Experts: Economy, workforce gap temper manufacturing growth

While the manufacturing industry has seen an uptick in activity this past year, the uncertainty over state and federal regulations coupled with a shortage of qualified workers could temper any future growth.

This was the consensus of a panel of experts at the Daily Herald Business Ledger’s Newsmakers Forum Thursday, About 100 suburban business leaders and entrepreneurs listened to the group discuss the state of the industry at Waubonsee Community College’s new downtown Aurora campus.

Janice Christiansen, president and CEO of J.C. Schultz/The Flagsource in Batavia and chairman of the Illinois Manufacturers Association, noted that business has picked up a bit in the industry, but stopped short of calling it a “surge.”

“That might be too strong of a word,” Christiansen said. “Most of our IMA members are either flat or are growing slightly.”

She said the mixed bag of national and state politics, higher taxes and changes in health care, labor laws and other regulatory issues are not giving manufacturers a clear signal on how to proceed. In addition, manufacturers are dealing with higher raw material costs, which may force many to raise their prices next year.

As a result, Christiansen said, most are hesitant to invest money into growth because they are unsure of the return they will get.

“There’s too much uncertainty without a light at the end of the tunnel,” she said.

Ryan Light, senior vice president and practice leader at Assurance Agency in Schaumburg, added that the volatility in national and international markets has made it difficult for companies to plan long-term.

“It is a very fluid environment,” Light said. “They cannot predict what their needs will be beyond 60 days.”

While unemployment remains around 10 percent, the panel agreed that growth will also be tempered by a lack of qualified workers. Christiansen and James Duff, market manager for BMO Harris Bank, noted factory workers today need to be trained to handle more complex machines and technology, which require a unique skill set that isn’t being found in the ranks of the unemployed.

“The education issue is very real,” Duff said. “How do we get (the workforce) better at math and hard sciences?”

Mark Schultz, principal at Dugan & Lopatka CPAs in Wheaton, said that outside the Chicago areas he’s found companies that are searching out skilled workers to hire so their workforce can be ready when they need to grow.

“They are using their contacts within their communities to find the best of the best and get the skilled labor they need,” Schultz said.

All the panelists note community colleges like Waubonsee play an important role in providing the training needed for a new crop of workers, but Christiansen noted that there is a perception about factory work that just isn’t true anymore.

“Manufacturing is no longer a dirty floor and greasy tools,” she said. “Manufacturing jobs are more technical and skilled.”

Presenting sponsors at the Newsmakers Forum were Assurance Agency LLC, Dugan & Lopatka, and BMO Harris Bank. Corporate sponsors include American Slide Chart/Perrygraf, Comcast Business Class, Batavia Enterprises and Waubonsee Community College. Marketing partners include Aurora Economic Development Commission, Greater Aurora Chamber of Commerce, Quad Cities African American Chamber of Commerce and Valley Industrial Association.