Read more on the labor crunch: https://plasticsmachinerymanufacturing.com/21248002/.By Karen Hanna
With companies across a vast swath of the economy in need of workers, plastics plant managers and owners say they are in a numbers crunch: Too many openings, too few people.
“I talked to our HR manager this morning. She found an employee she thinks would be great. She was really excited for him, but he said he has six more job interviews today,” said Dakota Kieffer, co-owner of Plastics Unlimited, a thermoformer started by his parents.
Processors find themselves competing with a variety of other industries to find entry-level workers. Headhunters for higher-titled positions also report bidding wars for candidates.
To keep up, Plastics Unlimited has doled out breakfast pizzas and nachos and raised wages by $3 an hour. At Chattanooga, Tenn.-based M&M Industries Inc., day laborers can choose the days they’d like to work, with no commitment. Meanwhile, workers at NewAge Industries Inc. who help their acquaintances land jobs at the Southampton, Pa.-based extrusion company are eligible for quarterly prizes.
At Champion Plastics Inc., members of management joined employees on the line when the Auburn Hills, Mich., company required all workers to temporarily work overtime and weekends. For workers, the experience led to one unexpected benefit — managers who sat on chairs while performing duties on the plant floor found they were so uncomfortable they immediately bought new ones, according to a company LinkedIn post. In addition, the company’s director of operations regularly buys employees lunch and has surprised them with gift cards; employees even spent one Friday afternoon together at a lake.
It is not always enough.
“I’ve talked to other companies and people show up for 5 minutes and leave. And I’m like, ‘Man, I don't have time for that,’ ” said James Schoudel, VP of Jesco Injection Molding Inc.
The Sandy, Utah, company offers more than $15 to starting employees.
Production gridlock
Due to snags all along the supply chain, manufacturers are struggling to maintain productivity, said Perc Pineda, chief economist for the Plastics Industry Association (PLASTICS).
“Over the past 10 years, the value of finished-goods inventories of plastics — and we include rubber there because of how the government aggregates its data — actually peaked in June 2019 to 13.3 billion [dollars]. Thereafter, it fell like 11 percent, in August 2020, to 11.8 billion. Since August 2020, inventories have only increased 7.9 percent, in September of this year, to 12.7 billion,” he said. “So, inventories are actually really, really low, which means whatever they’re making, it’s going off the shelf, flying off the shelf like hotcakes.”
At Agri-Industrial Plastics Co., which has raised hourly wages by nearly 12 percent since the start of the COVID-19 pandemic, company President and owner Lori Schaefer-Weaton is mulling the potential price of the current workforce woes.
“For a defined period of time, I think overtime is OK. But in today’s world, we probably have more employees that would prefer to work less than 40 hours a week than those who want to work more than 40 hours a week,” she said.
With a workforce of just over 200 people, Agri-Industrial Plastics was at about 87 percent of desired capacity in October; at the time, the Fairfield, Iowa, extrusion blow molder was looking to hire about 30 more machine operators. Overtime could create burnout that would drive workers away, but operating at diminished capacity also carries risk, Schaefer-Weaton acknowledged.
“I think that we also know that we’re losing opportunities for future growth,” she said.
According to a Deloitte and the Manufacturing Institute report, about 80 percent of manufacturers surveyed said not filling jobs has a moderate to very high impact on their companies’ ability to maintain production levels to satisfy customer demand, respond to new market opportunities, support new product development and implement new technologies.
Gearing up for growth
With 27 presses and about 50 employees, Pyramid Plastics Group is growing, but Chief Operating Officer Andrew Peterson credits aggressive pay raises and a fun culture for helping the Rockford, Ill., tool maker and custom injection molder keep up with demand.
"We definitely have more openings than we did before the pandemic, but we also have more employees. Our current openings are due to increases in sales and getting staff for that," said Peterson, who conceded it's "hard to find enough talent."
Less than 80 miles down the road, Plastics Unlimited is growing, too.
Located in tiny Preston, Iowa, a town of about 1,000 people, the company has been contemplating overtime. It has always had problems attracting workers, Kieffer said. Now, keeping them is proving challenging, as well.
Enticed by a shorter commute or a different shift, people are taking new jobs, creating a more-rapid-than-usual churn, he said.
“I would say most of them would be going for other manufacturing jobs. A lot might be going to retail or go to restaurants,” he said. “… A lot of them who leave don’t really give us any notice. They’ll call and say ‘Hey, here’s my two weeks’ notice,’ but then they’ll never come back for another day. A lot … do not make it past a month of employment where they just don’t show up four or five times in the first month, so we actually let them go.”
Like many plastics processors, Plastics Unlimited offers entry-level jobs that require no experience and little more than a good attitude, reliable transportation and the ability to handle some sustained physical exertion. But it is revising how it assesses potential candidates.
“I would say our standards [for applicants] have probably dropped because, before if you follow their job experience in the past [and] they only kept a job for no longer than six months of the last few years … before, we probably wouldn’t hire them. Now, we’ll definitely give them a chance,” Kieffer said.
The thermoformer, which supplies Polaris, Harley-Davidson and an array of other companies, employed about 100 people as of October, but was adding shifts to accommodate its customers’ growth. It is aiming to add 40 to 50 positions by the end of the year.
“If we can’t, we can try to work on extended hours, overtime, weekends, do whatever we can to meet as many orders as we can,” Kieffer said.
Heading up efforts to prepare for increased demand was HR manager Shelby Kingery.
The 13-year HR professional calls the current labor situation crazy. She recounted tales of job seekers who had all the commitment of someone at a speed-dating event.
“I’ve talked to people that are working in different factories, and they say a lot of people are taking vacation days to just go try out a new place. So, they’re not necessarily even planning on leaving their job; they’re just going into other factories to see if they would like it better, if the pay’s going to be better, or the hours are going to be better,” said Kingery, who has worked for Plastics Unlimited for 3½ years.
With companies upstream also suffering from labor and resin shortages, Kieffer acknowledged that predictability is in short supply.
“It’s a struggle day to day. Some days, the biggest struggle is getting materials. The next day, it seems like the biggest struggle is getting people. It goes back and forth every day, you really want more material. It’s very difficult getting materials on time for the last 10 months or so, but getting labor is definitely up there,” he said.
The rewards of free agency
It’s lonely at the top, too.
“If you are an executive or a professional with good technical skills, this is probably the best time you’re going to see in your career because there’s so many companies recruiting that, chances are, if you want a change … you’re going to see multiple offers,” said Jorge Gomar, who specializes in recruiting for industrial manufacturers as a senior client partner for Korn Ferry, a global consulting firm.
In his 36th year as a recruiter, Ron Eliason, who works for Midland Consultants, said he is enjoying the best two years for business in his career. He searches for people to fill high-paying roles in engineering and management, including positions as director of innovation, manufacturing or operations. Clients include injection molding, blow molding and extrusion plants.
“A lot of the people that have been in the industry for many years have retired or are retiring. There’s not a lot of people coming up through the ranks,” he said. “There’s not a lot of people that are process technicians; they’ve been doing it for 30, 40 years.”
Scarcity has given candidates leverage in their negotiations with prospective employers, Eliason said.
“It is definitely an employee-driven market right now. So, the issue you come into is people are getting multiple job offers where, maybe when COVID first started almost two years ago, they weren’t getting [offers], so if they got an offer, they would take it,” he said. “But now they have five other companies that want to hire them, so it’s more negotiation, it’s higher salaries.”
Most candidates already have jobs when they’re courted by a prospective employer — a phenomenon that’s a bit unusual for Eliason, who said in prior years, candidates might have come from a pool of people who had been laid off or orphaned by company mergers or relocations. As a result, candidates can be choosier.
Among mid-career-level workers not finding as much success was a New York City-based sales director, who was recently laid off from an East Coast company that supplies the plastics industry.
But his struggles reveal one of the sticking points Eliason has discovered with candidates — they are not willing to relocate.
“When you are living in the city, it is pretty tough in New York City to find a job. ... It’s not a manufacturing city,” said the sales director, who preferred not to be named due to concerns that talking to the press might compromise his job prospects.
To lure candidates, companies are offering better benefits, including more vacation time, sign-on bonuses and gift cards for good performance, Eliason said.
“I had somebody last week, they offered him a $25,000 signing bonus, which is unheard of,” he said.
He said candidates can earn promotions earlier in their career; he has even seen people switch jobs after just six months.
“Where companies would say, ‘Hey, we need 10 years of experience in plant management,’ now they're saying, ‘Maybe we’ll take five years of experience as a production manager.’ And, so, you've got more opportunities to get higher level-positions,” Eliason said.
Calling the shots
Job seekers used to sweating under the scrutiny of prospective new employers are finding the tables have turned.
“We’re having a hard time finding unskilled, as opposed to skilled [labor],” said Darrell Davis, VP and COO at M&M Industries. “Now, skilled labor we can find, but that does cost, so everybody can kind of write their own ticket on how much they want to be paid right now. Our shortage in skilled labor is nowhere near as bad as it is on the unskilled side.”
A maker of pails and other types of packaging, M&M Industries employs about 550 people in multiple locations, including Arizona and Ohio; as of late October, it was seeking to fill about 25 positions.
Hiring professionals and recruiters alike acknowledged that they are bidding against each other in the scramble to fill positions.
“Basically, you’re competing for the same people, and you’re hiring someone from the company down the street, and they’re trying to hire your people,” Eliason said.
Prospective employees have their pick of opportunities.
At Jesco, Schoudel was still hoping someone would choose his company.
“I’m still trying to hire people today,” he said. “So, anybody looking for a job, have them come by.”
Karen Hanna, senior staff reporter
Contact:
Korn Ferry, Dallas, 214-665-3018, www.kornferry.com
Midland Consultants, Middleburg Heights, Ohio, 440-234-1800, www.midlandconsultants.com
Plastics Industry Association (PLASTICS), Washington, D.C., 202-974-5200, www.plasticsindustry.org
Karen Hanna | Senior Staff Reporter
Senior Staff Reporter Karen Hanna covers injection molding, molds and tooling, processors, workforce and other topics, and writes features including In Other Words and Problem Solved for Plastics Machinery & Manufacturing, Plastics Recycling and The Journal of Blow Molding. She has more than 15 years of experience in daily and magazine journalism.
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