By: Don Loepp
February 22, 2017
I have a finger on the pulse of the plastics industry. I visit companies, talk to executives on the phone, meet them at conferences and shows. I also read tons of stories about them, written by our staff and others.
But once in a while I see something surprising about plastics processing. That’s happened twice in the past month. Maybe these snippets will surprise you, too.
The first came in our January podcast, which we call Plastics News Radio. Steve Toloken, our news editor-international, interviewed Bill Carteaux, president and CEO of the Plastics Industry Association.
Carteaux has been in the plastics industry for decades, and head of the association (which until recently was named the Society of the Plastics Industry Inc.) since 2005.
The topic was the new Trump administration, the potential for renegotiating NAFTA and the impact all that’s having on the plastics industry.
Everyone knows that U.S. plastics processors, like all manufacturers, have become more automated in the past few decades. Carteaux said that from 1980 to today, the plastics industry has outpaced the manufacturing sector average for productivity gains.
But here’s the surprising thing: In the 1990s, the plastics industry was underperforming when it came to productivity and automation. U.S. processors piled on labor instead of investing in robots, and plastics industry employment topped out at 1.3 million workers in 1999.
There’s nothing like an economic downturn to correct things, and that total dropped to 870,000 during the Great Recession. Now it’s recovered to about 950,000.
Toloken asked Carteaux if the industry is going to get back to 1.3 million jobs anytime soon. After all, the industry is booming, thanks to growing consumption of plastics and an expected boom in domestic resin production.
Carteaux said no. Because of automation, plastics production is going to continue to grow, but getting back to 1.3 million workers is “probably decades away.”
First, the predictable part: Workforce development is, by far, the top challenge for plastics processors. Some 92 percent of executives say it’s the top issue that they face.
Now the surprising part: The survey found that companies aren’t responding to the challenge by spending more on workforce development and training.
I realize that I deal more with companies that are more forward-thinking than average. Still, I don’t quite believe those numbers.
Anecdotally, I’ve noticed a lot more processors these days that invest in training. Just about every small molder I visit has an intern or two — some in the summer, some year-round.
Plus, most companies that hire entry-level staff — typically from temp agencies — pick workers they think are trainable and fit the corporate culture. Then they train them. Many employers link that training to more pay and promotions.
Few companies have full-blown apprentice programs, but they’re not unheard of. But don’t expect most plastics processors to start their own apprenticeships, because the nature of employment in the industry has changed.
Here’s how Bill Wood, PN’s economics editor, puts it: We’re on the cusp of a U.S. manufacturing renaissance, but the assembly line concept is still over. Those types of jobs are not going to come back to the United States in big numbers despite what Washington may promise.
Manufacturers, including plastics processors, understand the advantages of automation. But they also know that people are better than robots at certain things. So the key is to figure out when to buy robots, when to hire staff, and how to optimize the workforce.
“Who is going to figure out how to do that?” Wood asked me. “I think there’s a good chance that’s going to happen here in the United States.”
Loepp is editor of Plastics News and author of “The Plastics Blog.” Follow him on Twitter @donloepp.