Manufacturing takes on a new dimension

By Dennis Seid/NEMS Daily Journal

We build it, and they come.
For more than half a century, Northeast Mississippi’s manufacturing sector has helped power its economy.
Enticed by a cheaper place to do business, manufacturers flocked to the South and to the area after World War II. They liked the availability of the work force, its work ethic – and its low union presence.
And while the furniture industry makes up the largest part of manufacturing today, the region also has a history in textiles and apparel, hand tools, light fixtures, tires and even food.
Manufacturing continues to be a focus for the region’s economic developers. But not just any manufacturing. Enter Toyota and the automotive industry, which promise to bring thousands of jobs to the region.
In fact, the automotive industry is the “next big thing” for Northeast Mississippi.
“You ask what’s next. We had cotton, dairy, furniture … automotive is the next big thing,” says Community Development Foundation President and CEO David Rumbarger. “Our goal in recruiting an automobile manufacturer was to jump-start and prepare the base for that next big thing. … Automotive was the big kahuna, the thing that had to make it work.”
Going with the flow
For better or worse, manufacturing has as strong a foothold in Northeast Mississippi as in any other part of the state.
But the global economy has taken millions of those jobs away from across the country, and Northeast Mississippi has been no exception in the bleed-off of jobs.
With at least 20 percent of the region’s work force tied to manufacturing, according to Mississippi Department of Employment Security labor statistics, it’s no wonder that economic cycles have profound impact on the economy.
The last recession showed little mercy. After enjoying single-digit unemployment rates for most of the past decade, the region has been hammered with joblessness of 10 percent or more for most of past two years.
And based on MDES figures, the number of manufacturing jobs in the region fell 35 percent from 2004 to 2009, from 54,490 to 34,970. The 2010 figures have not been compiled.
“Manufacturing is a two-edged sword,” said Phil Hardwick, coordinator of capacity development with the John C. Stennis Institute of Government at Mississippi State University. “When you have an economy that is dependent on one particular sector, then it will rise and fall with that sector. Manufacturing is the sector most affected the last 20 years by globalization.”
Darrin Webb, the state economist for Mississippi, agrees.
“Manufacturing has taken it on the chin the last several years,” he said. “We think the time of low-skilled manufacturing has passed and they aren’t coming back. The past two recessions, we’ve lost them for good.”
By “low-skilled manufacturing,” most economists and experts mean those jobs requiring nominal education and workplace skills. And the furniture industry more often than not fits that bill.
Framers, upholsters and cut-and-sewers at any furniture manufacturer would argue, of course.
“The cut-and-sew people – the ones who cut the patterns and sew them – are the heart and soul of the industry,” said Ken Pruett, president of the Mississippi Furniture Association. “It takes plenty of skill and talent to do what they do.”
Nevertheless, their numbers are dwindling.
That’s why the MFA lobbied the state Legislature two years ago to offer incentives for companies to create cut-and-sew jobs.
Pruett estimates about 4,700 of those jobs remain.
While the furniture industry has seen some life in the past few months with announced expansions and added jobs, the bleeding hasn’t stopped; it has merely slowed to a trickle.
Pruett said that since 2001, at least 11,200 furniture-related jobs have disappeared from the region.
Despite the hits, the furniture industry directly employs some 18,000 workers, plus thousands more indirectly.
So furniture manufacturing at least has a grip, if not exactly an iron grip, on employment in the region.
Manufacturing in general always will have a presence of some kind in any economy. And many experts insist that American manufacturing should be supported and developed as much as possible. Offshoring is not an inevitability, they say.
Michelle Nash-Hoff, author of “Can American Manufacturing Be Saved,” says yes, it is not too late to do what her book title asks.
“We have an opportunity in the next four or five years to recover from the slide toward going off the cliff,” she said. “Manufacturing is like one leg of a three-legged stool and we have toppled it over. Manufacturing is a function of our economy. They’re higher-paying than service sector jobs.
“We should be manufacturing in America. We need tax incentives to help manufacturing and close the tax loopholes to stop offshoring.”
Advanced manufacturing
For many economists and experts, the type of manufacturing that is most difficult to send overseas is advanced manufacturing.
No wonder then that regional leaders sought the “next big thing” to diversify and build the economy was just that.
When the Pontotoc Union Lee Alliance, or PUL, formed a regional economic partnership a decade ago, its goal was to pursue some type of advanced manufacturing. Their main target – the automotive industry. And in 2007, Toyota obliged, selecting PUL’s Wellspring Project site in Union County to build its newest North American assembly plant.
“Manufacturing has been our history,” Rumbarger said. “That is the next thing for us – what else is there? Manufacturing, though, has declined generally the last 10 years and there’s nothing that tells me that it’s going to change. I think the U.S. will keep a strong remnant of manufacturing that’s advanced, and that’s what we’re working for in Toyota.
And, said Webb, “Toyota isn’t low-skilled manufacturing. They’re good jobs for the state and the nation.”
Toyota wasn’t the first automaker to eye Mississippi, but the automotive industry still is in its infancy in the state. Nissan, which built a plant in Canton in 2003, employs more than 4,000 workers.
Toyota, in the midst of hiring 2,000 employees for its Blue Springs plant, plans to open later this year. Suppliers could add another 2,000.
Clearly, landing Toyota in 2007 was the catalyst area leaders hoped to build the 21st economy in Northeast Mississippi. Not that it was easy.
“Pulling a Toyota is like pulling a rabbit out of a hat,” Rumbarger said. “For a rural community to be able to compete with the metro areas and succeed, it’s highly unusual.”
With a deep history in manufacturing, the region’s next logical step was to see how to reinforce its presence.
“We haven’t necessarily arrived since 2,000 people aren’t working there yet,” Rumbarger said. “But we’re on our way.”
Contact Dennis Seid at (662) 678-1578 or dennis.seid@journalinc.com.

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