PA. AIMS TO KEEP PLASTICS INDUSTRY GROWING: OFFICIALS WORK TO STRENGTHEN END-USER MARKET

Comments Email Print

HARRISBURG, PA. — The Pennsylvania Plastics Industry Summit offered participants a chance to flex some political muscle with the state's Republican governor and brag about how the growth in plastics jobs is boosting the state's sagging manufacturing sector.

But the April 16 event also featured a dose of economic reality: Job growth in plastics lags that of many other states.

Pennsylvania has the sixth-largest plastics industry in the country, with 64,300 jobs and $10.4 billion in shipments in 1994, the last year for which figures are available.

But it ranked 28th among states in the rate of growth, registering 11.4 percent growth between 1991 and 1994, much less than the 30 percent or better rates enjoyed by the fastest-growing 15 states. The top 15 include some states, such as Georgia, Michigan and Tennessee, that also have some of the largest plastics industries, according to statistics from the Society of the Plastics Industry Inc. in Washington.

Pennsylvania lacks Michigan's automotive industry and its conversion to plastics, and it cannot bask in the glow of expanding economies in Georgia and Tennessee, according to participants at the summit.

``What it means to Pennsylvania is that us guys and gals need to think and work together, instead of going laissez faire,'' said Jack Downie, chairman of the summit's steering committee and former president of Conair Franklin in Franklin, Pa.

The committee members are to discuss formation of a permanent organization.

Some participants noted that the size of Pennsylvania's industry would make it difficult to sustain the rapid growth of some of the upstarts, such as South Dakota. But warnings of trouble also came from outside the industry.

``We believe Pennsylvania will continue to be handicapped by the relatively slow growth of the end-user community in the state,'' said William Kametz, vice president of Mellon Bank NA in Harrisburg.

The industry still will grow faster than the U.S. economy, but not as fast as in states where end-users such as the auto and computer industries are growing, he said.

Pennsylvania Gov. Tom Ridge, who spoke at the summit, has tried to shift the focus from attracting new companies to retaining and expanding the state's existing firms, according to Tim McNulty, policy director of the state's Department of Community and Economic Development.

But the state does not ``wheel and deal'' to get big factories, which in turn attract plastics operations, as does South Carolina, said Tony Mack, the vice president of quality and development for Fabri-Kal Corp. in Kalamazoo, Mich. Officials from Fabri-Kal's Hazelton, Pa., plant spoke at the summit.

But Pennsylvania has some strengths on which to build, participants said. The state has two of the nation's four plastics schools certified by the Accreditation Board for Engineering Technology, and it needs to do a better job of promoting its educational base, said Bruce Cleevely, director of the strategic tooling center for AMP Inc. in Harrisburg.

Pennsylvania has good educational programs for a range of industry jobs, from technicians to engineers, said Tim Weston, an instructor at Pennsylvania College of Technology in Williamsport.

Nonetheless, industry managers said that attracting qualified help remains a problem, particularly for technicians.

``There is a crying need for more skills on the shop floor,'' Cleevely said.

As that need grows, vocational and technical programs are losing funding to universities and seeing grant money dry up, said John Geissler, assistant administrator of the Erie County Regional Occupational Skills Center in Erie, Pa., which provides training in plastics. The center receives about $50,000 a year in federal education grants, down from $320,000 a decade ago, he said.

And skills of international competitors in Asia are rapidly catching up, said Douglas Nutter, global glazing business director for GE Plastics in Pittsfield, Mass.

``What has changed really fundamentally is the skill set of workers in Thailand or China or Malaysia or India,'' he said. ``No longer is this skill set unique'' to the United States.

The state also needs to attract business from manufacturers in the Northeast that look south to get plastics products, Cleevely said. An internal GE Plastics study found that there are more manufacturers in the Northeast than there are plastics processors to supply them, so the manufacturers look primarily to the Southeast, Nutter said.

Even though work force training remains a problem, the state's regulatory climate is improving under Ridge, participants said. Ridge spoke at the summit, along with several other state officials.

Company managers pointed to lower workers' compensation costs and improved environmental laws, but one Fabri-Kal Corp. manager told the group that Pennsylvania ``still has a ways to go'' compared with other states.

Mark Lesky, public affairs leader for Nova Chemicals Inc. in Pittsburgh, said his firm would not have purchased an Arco Chemical Co. site in Beaver County, Pa., if the state had not rewritten environmental laws to eliminate Nova's liability for cleaning up pollution left behind by Arco.

New workers' compensation laws that make it harder for workers to ``shop'' for doctors to collect benefits have helped cut costs by 25 percent, although more needs to be done, said John Davis, vice president and general manager for North American Film in Bridgeport, Pa.