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Manufacturers in Northwest say finding skilled labor is greatest challenge

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Pacific Northwest manufacturers across a broad spectrum of industries are optimistic about the future but concerned about the ability to grow their workforce, which is seen as the biggest challenge facing Northwest manufacturers.

That’s according to the results of an anonymous survey of 104 company leaders in Washington and Oregon conducted earlier this year by Portland-based DHM Research on behalf of Washington law firm Schwabe, Williamson & Wyatt and consulting firm Aldrich Advisors.

The survey results paint a picture of a tight regional labor market in which a majority of manufacturers are seeking to grow their workforce but face challenges in attracting and retaining skilled employees.

“The number one issue that is facing manufacturers, bar none, is workforce,” said Jennifer Campbell, industry group leader at Schwabe, Williamson & Wyatt. “And that’s consistent with the national numbers as well.”

Sixty-two percent of respondents in the survey said they plan to increase hiring in the next year compared to the previous year, and 73 percent listed improving their workforce as the biggest upcoming challenge for the company. Fifty-five percent also expressed concern that their organization was unprepared to overcome its biggest challenge.

When asked about the challenges to workforce growth, 72 percent cited a lack of available skilled labor. Fifty-five percent cited competition from other employers, 31 percent pointed to a lack of nearby affordable housing and 26 percent cited an inability to offer competitive wages.

“The issue with tracking and retaining employees is an ongoing struggle for our local manufacturers,” Campbell said. “And it’s not just manufacturers — it’s also construction and some other industries that are facing this. It’s an issue that’s not going away.”

For some Vancouver manufacturers, those results sound familiar. Portland-based Vigor Industrial operates a fabrication site along the Columbia River in Vancouver, formerly known as Oregon Iron Works. Vigor spokeswoman Athena Maris said the company began partnering with Portland Community College to open a training center at Swan Island, the site of another Vigor facility.

“For Vigor, the challenge is threefold: Finding and retaining skilled workers, the cost of doing business in our region of the country given higher labor and environmental compliance costs and the uneven nature of the new construction pipeline,” she said. “This last point feeds into the difficulty of workforce retention, which can be problematic for the project-based nature of new construction.”

Michael Moore, vice president of business development at Vancouver-based Thompson Metal Fab, said the company is seeing a high number of workers retiring from upper-level positions at a time when most of the industry’s workers are already employed and not seeking new jobs. The company has been focusing on trying to create opportunities for its own workers to develop new skills and advance internally, he said, because entry-level positions are easier to fill from outside. It’s also been trying to align itself with trade schools and high schools where workshop and metal fabrication classes are being held.

“We may not get our hands on these students for five-plus years,” he said, “but that’s OK because we’re going to need them in five-plus years.”

Campbell said manufacturers in the survey pointed to retirements, low unemployment and bad perceptions of manufacturing jobs as some of the other causes of the workforce struggle. Some of the respondents said they were trying to push back on those factors with a number of strategies such as expanded apprenticeship programs, flexible work schedules and making new connections at local high schools and community colleges.

Manufacturers also see the Pacific Northwest as an asset when it comes to recruiting new employees. Food and beverage manufacturers in particular said they found a good fit with a regional appreciation for natural and organic foods.

On the other hand, manufacturers said operating in the Northwest also creates challenges due to a high cost of living and high taxes, particularly in Oregon. Still, the pluses appeared to outweigh the minuses: 94 percent of respondents said their companies plan to remain in the region for at least the next few years.

“The issue with workforce is not a Pacific Northwest issue, that’s a nationwide issue,” Campbell said. “But there are so many pros that our clients found with being in the Northwest that keep them grounded here.”

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