From left to right:
• Mark Kaiser, president and CEO of Lindquist Machine and vice chair of the NEW Manufacturing Alliance
• Kurt Baer, co-owner of Mid-City Steel in La Crosse and chair of
The Upper Mississippi Manufacturing Alliance (TUMMA)
• Jim Waldron, president of Wausau Windows & Wall Systems and co-chairman
of the Central Wisconsin Metal Manufacturers Alliance (CWIMMA)
• Mark Hogan, secretary and CEO of the Wisconsin Economic Development Corp. (Moderator)
• Steve Daigle, owner of Daigle Bros. (Rhinelander Manufacturing Alliance)
• Michael Mallwitz, president of Busch Precision (Milwaukee 7)
• Alan Petelinsek, president of Power Test (Waukesha Business Alliance)
How healthy is manufacturing in Wisconsin? What are the challenges for the industry today? How can manufacturers find, train and keep skilled workers? These were among questions addressed when six Wisconsin manufacturing leaders gathered for a panel discussion during a CEO luncheon at the Manufacturing First Expo & Conference on Oct. 20. The following is an edited transcript of the discussion.
Mark Hogan: From the six companies that are represented here, there are 340 years of business in the state of Wisconsin. The first question that came out of the survey was your overall impression of the vitality of manufacturing in the state. Most leaders are positive about it. There are concerns about some of the larger manufacturers leaving the state and the impact on the supply chain, whether it’s a Brillion Iron Works or a Manitowoc Co., for example. Alan, do you want to just touch base on that?
Alan Petelinsek: We had a consultant come to our business. He saw the car count increasing in my parking lot. He said, “So tell me, what do you attribute your success to?” And I said, “I want to be successful.” I saw an economist talk about politics and its effect on GDP, and the bandwidths were red and blue, red and blue throughout the years, and it didn’t matter. It had to do with us business owners — what we believe and what we do with our businesses.
The politics of Wisconsin have enabled me as a business owner — especially with the manufacturing-ag tax credit — to reinvest in my business, and that’s created more jobs. We’ve grown 20 percent in our employment in the last year. I feel that WMC and the state legislature are making things easy. The different workforce alliances are encouraging us to do school tours, and we’re reaching back into schools and we’re showing them what manufacturing really looks like in this era. More than anything, it’s the networking that we all are doing as business owners — learning who each other are, learning best practices and that’s what’s going to make us all be successful. WEDC even launched the Made in Wisconsin campaign that allows us to take pride in the things we’re making here as we send them throughout the United States and abroad.
Mark Hogan: Thanks, Alan. Well over 100 companies have applied for the Made in Wisconsin program and can use that logo in their marketing campaign. You can find more about that on inwisconsin.com. So, other thoughts, any of the other panelists, relative to what you’re seeing?
Kurt Baer: We’re seeing the vitality is good. It means that there’s a fair amount of competition for our products. We make structural steel and other kinds of steel materials, and we’d like to have somebody build another stadium or something like that and consume a lot of capacity. But we think the market right now is good.
Mark Hogan: The second question on the survey was about how your companies are finding talent. Obviously, that’s a big part of what everybody’s job is today. Ten or 15 years ago, you saw that you couldn’t rely on the next best employee walking through your front door to apply for a job, so you invested in technology, and those companies are bigger and better. They’re employing more people in the state and are stronger than they’ve ever been. Mike, do you want to talk a little about what you’re doing from a talent perspective in Southeast Wisconsin?
Mike Mallwitz: I think Alan had a term that’s very apropos, and that’s networking. We had two customers of ours that were displaced and now one’s my vice president, and one is my service manager, because we treated our customers very well. The way you run your business and conduct yourself as community members, I believe, is the real key. If you interview a good candidate and you just can’t use them, by all means, pass that along to somebody else that you know that can use that candidate because that helps all of our business this part of the state.
Mark Hogan: The next question: 93 percent of you said you’re working on enhancing the skill sets of your employees.
Steve Daigle: I guess you never know what you’re going to be doing, and you never know what your employees will be good at unless you give them a shot at it. You’ve got to take a risk: Sometimes you’re going to retain employees, and sometimes they might decide that they want to move on. The most important thing you can do is work to retain the workforce you have, so we really try to listen to our employees. We have an employee who came to work for us, and he did phenomenal as a fabricator, and he was only there a month and he comes to me and says, “Steve, I got some bad news, I applied at Lincoln Hills School before I came here and they offered me a job.” They’re offering him a better-paying job than what he had with us. But this guy is a keeper. So we put him in our drafting department. We took his skills from the fab shop, and we invested in him. We didn’t know if it was going to work out, but it worked out fabulous, and he’s grown his skills, and grown his wage, and we’ve been able to retain him.
Mark Hogan: That’s a great story. The next question was about working on a talent strategy for how you will find talent in the next two to five years. Sixty-three percent said they’re working on this. I’m surprised it isn’t higher.
Mark Kaiser: I am, too. The talent acquisition piece is really difficult up here, and that’s why I’m really excited with efforts now to bring engineering programs locally. I’ve got four of our associates in that program. Every Tuesday they go down to Appleton, they have their day of classes, and they do their homework together. We’re doing those things because that’s what we need to have the talent. I think that those are some short-term things, but I think the longer-term issue is even a little more dire. Manufacturers in our demographics are old, we’re all going to retire, and we don’t have enough young people moving in. We don’t have enough retention of students when they graduate. As a state we’re not growing, population wise, so we’ve got a big challenge in front of us, and it’s bigger than just the New North.
I think the manufacturing alliance has been wonderful; we’ve got some great successes here, and we have been able to fill that pipeline with young students and get them attracted to manufacturing. You need to attract talent that is experienced and fits the culture, and the culture piece is usually the much more difficult piece to hire. If you can find those people, you hire them and you teach them the technical piece, and that’s been our philosophy. We’re trying not to go out as much and hire experienced people, because one, you can’t find them, and two, you’re just stealing from the guy next door, and that’s not a good long-term solution at all.
Mike Mallwitz: The technical colleges, to their credit, have now gone back into the high schools and they do enrollment credits. That’s really helpful, and they are starting to get support for these fundraising initiatives and have put in some very state-of-the-art shops and labs for the students. And, as businesses, I think it’s critical that you open your doors to your community. Go to the schools, talk to the students. We’re going to be doing a program where Milwaukee Public Schools students will come in. We’re going to network and bring in Milwaukee Area Technical College as part of that, and we’re also bringing somebody with the German apprenticeship program. Use the resources and make yourselves even more effective.
Mark Kaiser: We’ve got the technical colleges, manufacturers and K-12 all aligned pretty well now. There’s a high level of trust in their relationships. Now the challenge is the parents. I think parents still view manufacturing as an unattractive career. We’ve got to change that. I know that’s one of the things we’re working on with our manufacturing alliance, is how can we reach out to them and give them the manufacturing story so that they can tell their kids this is a great career choice.
Kurt Baer: One of our prior employees who had a passion for training is now the technical trainer for a welding program in Winona, Minn. Having worked for us for a number of years, he knows our culture, knows the kind of people we’re looking for. We give him materials to use in his class, he brings it back to us, and we put it in our scrap bin. Moreover, he handpicks students he knows are going to fit in, and he sends them our way. And it’s very successful because he knows what we’re looking for.
Alan Petelinsek: When we moved into our community in 2008, I learned the auto class at the local high school was going to be killed because they needed a car, but they didn’t have the money. It was $600 for a beat-up Taurus. They were going to kill a program for a $600 car. We purchased the car, the program continues, and we’ve got a relationship with that high school that we’ve not seen before. They feed us the best kids into our youth co-op program. That’s what it takes — businesses reaching out to local schools, meeting them where they are, finding out what we can do for them. And they’ll bend over backwards for us.
Mark Hogan: Kurt, in this survey, about a third of respondents said that they view the greatest challenge is not enough people were interested in manufacturing careers (47 percent felt it was a lack of skilled workers).
Kurt Baer: I think the K-12 initiative can be directed toward the parents, as Mark said, because I think parents aren’t really excited about financing four years of college, and there’s nothing wrong with that. I think that they need to realize that manufacturing is a very effective path to help their kids become independent. Moreover, those jobs then can produce opportunities in the future. As manufacturers, we need accountants, we need marketing people, we need business management people. We’re not all gearheads here. We need those other business skill sets.
Jim Waldron: The Central Wisconsin Metal Manufacturers Alliance was borne out of the NEW Manufacturing Alliance. Earlier this month, we had 5,300 eighth-graders who went through two manufacturing tours and then they toured a technical college. Seventy companies gave tours. There were 23 school districts and 10 counties, and this is the third year we’ve done it. We went from 350 the first year to 5,300 this year, and they now get a chance to go through and see what manufacturing is. I talked to hundreds of kids at the technical college. I’ll talk about how we have accountants, we have engineers, we have salespeople, we have welders. The biggest piece is the guidance counselors — we haven’t quite gotten them up to speed. It’s parents and guidance counselors who seem to be next.
Kurt Baer: Don’t you think with academic career planning that’s being required now that there’s an opportunity to pitch to these students and their parents to remember our manufacturing sector because it’s a solid career?
Jim Waldron: Yeah, and we’ve gone down the path of “a good plumber makes a lot more money than an average office worker.” It’s amazing how many people don’t think of it in those terms. Parents may not want to pay for college, but they haven’t thought about the other careers that are out there.
Mark Kaiser: I think the academic career plans (ACPs) are a good opportunity for us, but for that to work, we’ve got to be in the middle of that as manufacturers. It’s critical that we’re at least a part of that whole process with guidance counselors and with those students.
Mark Hogan: Last year, the legislature appropriated a $500,000 for fab labs for school districts throughout the state. WEDC administered the $500,000, basically $25,000 per school district, or 20 school districts over a three-year period. We had 92 applications from 92 school districts in the state. We took another $500,000 out of our program budget this year and put it back into the fab labs, and we want to do another 20 this year because the demand is there.
Alan Petelinsek: One of the things we’re working on in our business — because manufacturing ebbs and flows — is rather than going through layoffs, we do cross-functional training. Our welders can assemble, our assemblers can machine, our machinists can weld, and we’re taking that into the office side as well. That allows us to be much more stable in our workforce, and that’s what individuals are paying attention to.