FORT COLLINS — Leaders of manufacturing firms in Northern Colorado face challenges in maintaining a skilled workforce, providing quality health care for their workers and figuring out how to best handle employees who might partake in the use of recreational marijuana.
They also say costs associated with new and changing regulations issued by the Occupational Safety and Health Administration through the Department of Labor erode the bottom line, often affecting their ability to hire needed workers.
“We are growing quickly,” said Todd Whitbeck, chief financial officer of Water Pik Inc. in Fort Collins, who said he has about 15 to 20 job openings.
“Electrical and hydraulic engineers are hard to find here,” he said. “We’ve had to hire engineers in China.”
Entry-level employees with basic skills are also hard to find, said most of the executives who participated in BizWest’s CEO Roundtable on manufacturing Tuesday morning in Fort Collins.
Steve Anderson, president and chief executive of Forney Industries Inc. in Fort Collins, said there is a gap between baby boomers and millennials for welders and the trades in general.
Anderson is trying to fill that gap by offering scholarships to students to attend Front Range Community College’s trade classes.
“We’ve had some success working with Front Range as well as Colorado State University’s supply-chain management forum,” Anderson said. The forum provides partner companies with the opportunity to interact with CSU supply-chain faculty, supply-chain students and other company partners.
Dean Herl, general manager of Greeley-based Noffsinger Manufacturing Co. Inc., a maker of equipment for the agriculture industry, said it is difficult to find young qualified workers.
“The average age of our tech workers is 56. We will see turnover there. Instead of hiring someone with 10 years of experience, we have dropped that to five years of experience,” he said.
With a shallow talent pool, Anderson said an emerging trend is that blue-collar workers will demand higher wages. Tim Reeser, president and co-founder of Lightning Hybrids in Loveland, said he’s having to pay machinists more than engineers.
Terry Precht, CEO and president of Vergent Products in Loveland that designs and manufactures products for its clients, said he sees a shortage of electrical engineers.
“We want a candidate that has a two-year degree in electronics that has received a hands-on education,” Precht said. “For skilled assembly, a two-year degree is worth its weight in gold.”
Fort Collins-based trailer manufacturer Maxey Cos. merged with Pennsylvania-based MGS Inc. in 2014. Carl Maxey said as his company has ramped up assembly lines to two shifts during the past 18 months in Fort Collins, finding workers with the needed skills is a problem.
“We’ve tried to transfer employees from Pennsylvania to Colorado, but housing becomes a problem with the higher cost of homes here,” Maxey said. “We’ve had to take on the responsibility to train people.”
Garth Rummery, owner of Tharp Cabinet Co. in Loveland, also is training his own people.
“We look for good people who have a good personality, work hard and are team players. We have enough core knowledge to be able to train them ourselves.”
Marcia Coulson, president of Denver-based Eldon James Corp. that is planning a facility in Fort Collins, said her company looks for people with a strong work ethic and are able to pass a drug test.
“Our employees need to be thinking,” Coulson said. “One employee could be responsible for a million-dollars-worth of equipment. “They need all their senses,” referring to people who may come to work with a THC hangover or take a “smoke” break.
Maxey said the problem is that the state has not issued guidelines on what constitutes too much THC, the mind-altering ingredient in marijuana.
“It’s not defined. … And as employers, we cannot afford the risk of injury.” He said when an employer sends someone home because of alcohol use, “it is never challenged.”
Lisa Clay, CEO of her family business, Advance Tank & Construction Co. in Wellington, hires welders from across the country for projects her firm has across the United States. But she has more difficulty hiring in Colorado, where recreational use of marijuana is legal.
“I don’t have a choice. I say right up front, ‘don’t waste my time, can you pass a drug test?’ I’m waiting for someone to quantify the level of THC that is safe.”
Reeser said the state has done a poor job on educating about the effects of marijuana. “It is not as harmless as we are led to believe,” he said.
Most manufacturers in the room Tuesday lamented the direction health-care is taking but are even more wary of Amendment 69 that will be voted on in November.
The amendment to the state constitution would create ColoradoCare, a payment system designed to finance health care for Colorado residents partly through an approximately $25 billion increase in state taxes that would be paid by businesses and employees.
“This will have bad consequences,” Clay said. “It wasn’t good for Vermont or Massachusetts; so why would it be good for Colorado? We (as a company) might have to cut jobs or move out of state.”
Reeser conjectured that in the system will have a lot of waste and offer poor service.
Participants in Tuesday’s CEO Roundtable included: Steve Anderson, president/CEO, Forney Industries; Lisa Clay, CEO, Advance Tank & Construction Co.; Marcia Coulson, president, Eldon James Corp.; Dean Herl, general manager, Noffsinger Manufacturing Co. Inc.; Carl Maxey, president, Maxey Cos.; Terry Precht, CEO/president, Vergent Products; Tim Reeser, president/co-founder, Lightning Hybrids Inc.; Garth Rummery, owner, Tharp Cabinet Co.; Todd Whitbeck, chief financial officer, Water Pik Inc. Moderator: Christopher Wood, co-publisher/editor, BizWest Media. Sponsors: Luis Ramirez, David Fritzler and Luis Gutierrez, BBVA Compass; Jim Sampson and Russ Henniger, Hub International Insurance Services; Brian Rooney, Kreg Brown and Mike Grell, EKS&H LLLP.