Next year, Toyota will open the floodgates.
To fill the 2,000 jobs at the Toyota Motor Manufacturing Mississippi plant, which will open in two years near Blue Springs, the automaker is expected to begin taking applications sometime in the first half of the year.
And it expects some 70,000 people to submit their credentials.
For employers, that presents a challenge – some would say an opportunity – in how to deal with Toyota and the possibility of losing workers to the automaker or one of its suppliers.
“In the short term, I do think that for the skilled positions, some existing industry could take a hit because of the high demand and somewhat low supply of those jobs,” said Todd Beadles, director of work force development for the Tupelo-based Community Development Foundation.
“But in the long term, the region will be better off because we’ll be more prepared for the future. A lot more people will be trained in those skilled areas, and the labor pool will expand. That benefits other companies, not just Toyota.”
For employees, it means an abundance of new positions in the area’s job market. And even if they don’t go to work at the Toyota plant, which will produce the Highlander SUV, they already are seeing changes in their own workplaces.
About six years ago, Itawamba Community College, working with the CDF, began training in lean manufacturing, which was derived from the Toyota Production System. Since then, some 2,000 people have gone through the program and have gone back to their factories and businesses implementing those principles.
“It seems everybody is doing it around here, at least,” Beadles said. “When it has been applied, and embraced by a company, you see that they’ve done very well.”
No raiding of employees
It’s not unusual to find former employees from other manufacturing companies now building vehicles at a Toyota plant. The automaker also has put teachers, bankers, doctors, grocers, lawyers – you name it – on its payroll.
And that, some people say, is why NeMiss companies shouldn’t be too worried about losing their workers to Toyota.
Toyota, Beadles said, will not “raid” their work forces.
“I’ve talked to a lot of existing industry and other economic developers from across the region, and that’s a major concern,” he said. “My message has been this: From a production labor standpoint, I don’t think you’ll see any one company affected more than any other.”
The main reason is that the 1,500 or so production line workers who will be hired initially at TMMMS will come from a labor pool of more than a 275,000 people within a 60-mile radius of the plant.
“Toyota will go through a lot of people to get the employees they need,” Beadles said.
David Copenhaver, TMMMS vice president of production and administration support, also is trying to assuage their fears.
“I suspect that most companies don’t need to worry,” said Copenhaver. “I don’t want to speculate, but from past experience, we’ve never gotten more than a handful of people from any one employer.
“We cast a pretty big net. We never have, and have no intention to, target a particular employer … we wouldn’t allow it.”
Demand for workers
One potential source of employees is the $4 billion furniture industry, which is based primarily in this region. Some 20,000 people are directly employed by hundreds of manufacturers; thousands more work for industry suppliers and vendors.
However, thousands of furniture jobs have been lost in this decade, and Toyota is an answer to many hopes and dreams.
But manufacturing a couch is different from building an automobile, so there are no guarantees that workers’ experience will help – or hurt.
“Typically, manufacturing experience hasn’t been a factor in hiring,” Copenhaver said.
And while Toyota may look far and wide to fill its production work force, the more highly skilled positions, such as tool and die maintenance and facilities maintenance, are in short supply in the region.
Gene O’Hargan, vice president and general manager for lighting manufacturer Day-Brite/Capri/Omega, knows that some of the 700 workers at the company’s Tupelo facility could be hired by Toyota. Some of those high-skilled jobs that Toyota is looking for may very well be found at Day-Brite.
“Our biggest concern would be in losing someone who has been with us for a long time and what we call the ‘replacement costs’ involved,” O’Hargan said.
What Toyota will pay its workers is another potential headache for area employers.
While Toyota hasn’t said exactly how much it will pay its production workers, the consensus is that it will top out at about $20 an hour.
“Toyota is studying the regional wages and will base theirs on what they find,” the CDF’s Beadles said. “Typically for the skilled labor positions, there will be another 15 percent to 20 percent on top of that. Toyota doesn’t want to come in an disrupt the pay scale.”
That brings some relief to executives like Day-Brite’s O’Hargan, who believes his work force will be nominally affected by Toyota.
“We don’t think we’ll be impacted very much – but you never know,” O’Hargan admitted. “We think we treat our people fairly, and if you do that, you’ll keep them. But at the end of the day, if someone wants to go somewhere else where they think they could better themselves, we’re not going to deny them that opportunity.”
Area companies aren’t boosting their wages significantly in order to keep their employees from leaving – and they may not need to, Beadles said.
“The majority of the mid- to large-sized industries pay competitive wages with Toyota for their production jobs,” Beadles said. “Toyota will fill their positions, no doubt, but people with tenure at existing companies may not necessarily leave if they’re happy where they’re at.”
Beyond the workplace
But Toyota’s impact will be – and has been – beyond just employment.
The company’s legendary drive for continuous improvement and aspects of its vaunted Toyota Production System have already been adapted by many area businesses, for example. And its desire to be a good corporate citizen is no better demonstrated than its commitment to give $50 million to the public school systems in Pontotoc, Union and Lee counties.
Author David Magee, who wrote “How Toyota Became No. 1,” said the entire region will benefit from the company’s presence.
“A rising tide lifts all ships,” Magee said, a familiar refrain heard around these parts.
In fact, in Georgetown, Ky., where Toyota built its first North American assembly plant 20 years ago, the company is building a tech center to do just that.
The automaker, along with the Kentucky Community and Technical College System, have developed the Advanced Technology Center modeled after an auto manufacturing plant. Designed to provide “real-world” training, the center will provide skilled training to all area manufacturers when it opens next year.
“This isn’t just for Toyota,” said Jack Conner, executive director of the Georgetown/Scott County Chamber of Commerce. It’s also for other regional manufacturers who want to take advantage of the center.”
Beadles said Toyota is developing a similar model here.
Keeping what you have
It’s clear that Toyota has, and will continue to have, a profound impact, on the NeMiss work force.
Deborah Tierce, has been a frequent seminar leader on employee retention. She said companies have everything – and nothing – to fear from Toyota.
“Toyota and its suppliers will affect every single employer in the area,” said Deborah Tierce, a Tupelo-based consultant, trainer and motivational speaker.
“We are transitioning to a whole new kind of work. It’s an employees’ market – they can leave if they want to for anywhere else. So it will take a new leadership style to help keep your employees.
“It’s not necessarily what they’re being paid. It’s how they’re being treated, how they’re being challenged at work, how their able to balance their personal lives with their work,” she said. “You do that, and you’ll keep your employees.”