Business Strategies

Opportunities for Growth Revealed for Manufacturing Companies

MassMEP and the North Central Massachusetts Chamber of Commerce released the results of a year-long study of manufacturing in the North Central region, The North Central Massachusetts Collaborative Manufacturing Communities Growth Initiative. The study was funded by a grant from the USDA Rural Business Opportunity Grants program and conducted by RTI and interviewed 50 companies from the region from a total of 492.

The objective of the study was to provide, in one resource, a characterization of the manufacturing industry in the area, as well as identify barriers to growth and relevant market opportunities for future growth. Twenty-five percent of the region’s manufacturing companies participated in the survey.

A pathway for future growth was presented to the attendees that clearly outlines objectives and recommendations for manufacturing growth.

The key findings of the survey:

• Manufacturers identified lack of skilled workforce, regulatory constraints, and lack of access to opportunities as the main barriers to growth.
• The outlook for manufacturing is bright due to increasing costs in China and low energy costs in the U.S. – there is now a net gain in jobs.
• Strong growth opportunities exist in certain markets (e.g. medical device, tooling, aerospace, smart packaging).
• Advanced manufacturing technologies, like 3D printing, digital design, and advanced materials, are opportunities but also threats if SMEs fail to adopt them.

“This federally funded study identifies opportunities to capitalize on the enormous manufacturing capabilities of the North Central region," said U.S. Representative Jim McGovern. “I am confident that this collaborative effort, coupled with the support of local, state, and federal, agencies will generate significant economic growth in the region."

Local Representation
At the conclusion of the presentation, representatives from several local manufacturers offered some of the challenges they face today’s business climate.

Fitchburg’s Rocheleau Tool & Die Co. Inc. and Gardner’s Data Guide Cable stated healthcare costs are the greatest challenge.
"We spend more money on health insurance that for the materials we use building our products," said Steven Rocheleau, the company’s president.

Data Guide Cable’s President Donald Irving told the audience that when he gave his annual state of the company address to his employees, he told them that if they could provide their own health insurance, he would buy each employee a three-bedroom house in Gardner, saying that would be less expensive for the company.

"It’s a huge expense that’s crushing us," said Irving.

Fitchburg’s Steel-Fab Inc. President Mark Freeman briefly explained how regulations are restricting his ability to provide employment here. He said his company is currently having a project built in Arizona that represents 13 years of man hours in labor because wide-load regulations wouldn’t allow the item to be transported from here to there.

Irving also said the state’s inventory tax is "hurting us." He said that he may have $2-3 million in inventory in the building and he still has to pay a tax on it, "even if we’re losing money. For those of us to who make things, it’s a huge concern." He said the recently passed change in employee sick time regulations are another looming crisis.

Pete Angelini, representing Aaron Industries, a custom plastics manufacturer, said high energy costs were his company’s greatest challenge. "Energy has become extremely burdensome."

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