Oregon's small manufacturers grow under the radar

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Articles - October 2013
Monday, September 30, 2013
1013 Manufacturing 07
Angelina Alcoke flame-polishes plastic boxes in the 30,000-square-foot Applied Plastics facility.
// Photo by Adam Wickham

Following in the footsteps of his grandfather, who worked at a paper mill his entire life, Steve Beauchamp has operated the heading machine at Portland Bolt for 34 years. Wearing a T-shirt with the sleeves cut off one recent morning, the muscular 55-year-old transferred steel rods with red-hot tips one by one into a giant gray forge. The machine clamped down and, with a deep thumping sound, punched out a hex head.

Beauchamp realizes spending multiple decades with the same company is almost unheard of these days, but he likes the stability. “This is a really solid company that grows,” Beauchamp says. “I feel appreciated here, that my experience is valued.”

Like many small-business owners, Bolt’s Todd emphasizes the family-like atmosphere of his company. “I come out here all the time,” he says, walking across the floor as members of the day shift thread and galvanize bolts. “I know all their names. I’m invested in them, and they’re invested in us.”

In general, manufacturing jobs treat their holders well, according to the Value of Jobs Coalition report. They offer wages and salaries 8% higher and benefits 59% higher than their nonmanufacturing counterparts. Plus, nonwhite manufacturing workers earn 49% more than nonwhite workers in other sectors.

In addition to covering 90% of health insurance premiums and providing seven paid holidays and two weeks of paid vacation per year to start, Applied Plastics pays for a life coach to consult one-on-one with its employees every month. “With a small manufacturer, the company has personality,” Riddle says. “I’m not sure you’re going to get that in a large company.”

Though the long-term employee base of Oregon manufacturers is fairly stable, many have trouble recruiting new blood because the education system encourages students to attend college rather than enter the workforce or enter trade school and young people tend to job hop before settling down. Plus, the practical trades have the “cool” factor working against them. “Most people don’t raise their kids to go into manufacturing,” Scherer says, explaining that many think of production jobs as dirty and low paying. “We’d like to see that perception change,” he says.

Nevertheless, as the overall economy rebounds from the recession and an increasing number of companies reshore their production, the small manufacturers left standing are stabilizing and, in many cases, growing, Scherer says.

Columbia Forge & Machine Works, which produces everything from battleship door handles to pole-line transmission hardware for the Bonneville Power Administration, is in major expansion mode. Because so many other West Coast forging operations have closed down and the Portland manufacturer is successfully moving into new markets, it has seen revenue growth of about 15% each of the last four years, Leaptrott says. Scherer predicts the next decade will be a good one for U.S. manufacturers, especially those in Oregon, because the productivity of the Oregon workforce is higher than most.

To take advantage of the reviving economic climate, basic factory businesses across the state are looking for ways to adapt both what they produce and how they produce it. Many, including Best and AmFor Electronics, are streamlining their operations by incorporating lean manufacturing techniques, often with the guidance of OMEP. Others are adjusting their offerings to better correspond with demand. Layton Manufacturing in Salem, for example, has transitioned from making asphalt-paving equipment to mobile-home-moving equipment and food-processing equipment for companies like Bob’s Red Mill and Frito-Lay.

“When I saw the market was hard to sustain, I started looking for other products that could flow through the plant,” says president John Layton, who made the latest specialty switch in the early 2000s. So far the adjustment has paid off, he says. “We bottomed out in 2008 with the recession but have been enjoying 20% growth every year since then.”

AmFor Electronics, too, is adjusting its offerings to correspond with current economic circumstances. To make use of the capacity left over from a onetime, two-year contract it fulfilled for Advance Auto Parts in 2011, the company is trying to gain traction as a contractor that manufactures other people’s ideas.

“We have excess capacity space-wise and a pretty flexible workforce,” Oliver says.

Even though many of Oregon’s small manufacturers are extremely dynamic as they shake off the downturn and figure out how to grow amid the ever-changing forces around them, they go unnoticed by the mainstream. But it doesn’t bother them too much.

“I know we bring value,” says Todd at Portland Bolt. “I see it in the marketplace.”



 

Comments   

 
Guest
+1 #1 VP of Marketing and Business DevelopmentGuest 2013-10-08 21:12:25
Thanks for the terrific article. As a manufacturer of trade show displays and retail environments (Classic Exhibits), I couldn't agree more with the folks interviewed. It's a tough market with lots of overseas competitors, but if you are nimble and creative and rely on a talented workforce, it's possible to thrive as a smaller manufacturer. There are no freebees.
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