Viewing blog posts written by Gino DiCaro


CA industrial electricity rates are becoming a significant competitive disadvantage for MFG

Posted by Gino DiCaro, VP, Communications on June 18, 2018





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CMTA shows Legislature importance of CA MFG

Posted by Gino DiCaro, VP, Communications on June 11, 2018

You might recall from CMTA's earlier celebration and magazine feature that 2018 is the Centennial Anniversary year for CMTA.  In 1918, five founding companies started the Association (then called the California Manufacturers Association) because they were aware of the huge and growing role they played in the regional economy. 100 years later the same things drive our association and the sector itself - innovation, job creation and competitiveness.

Last week CMTA gained attention both in the Capitol and through twitter with a California manufacturing display in front of the Governor's office to help us celebrate our Centennial year and to launch our efforts for this year's Oct. 5 Manufacturing Day.  Assemblyman Mike Gipson also passed a unanimous Resolution on the Floor commemorating the Oct 5th Manufacturing Day and this week Senator Josh Newman will present his Resolution for CMTA's Centennial Anniversary year. The Capitol exhibit emphasized every reason why our State leaders should work to attract more manufacturing. With only 4.5 percent of last year's U.S. manufacturing investment and a manufacturing sector that continues to lag the national renaissance in job growth, California must enact policies that make our state more competitive for retention and attraction of manufacturing growth.

Make sure you show your support for California manufacturing by using this preformatted tweet

And don't forget to text "mfgchamp" to 916-571-9360.

 





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CMTA celebrates CA MFG with exhibit in State Capitol

Posted by Gino DiCaro, VP, Communications on June 4, 2018

You might recall from CMTA's earlier celebration and magazine feature that 2018 is the Centennial Anniversary year for CMTA.  In 1918, five founding companies started the Association (then called the California Manufacturers Association) because they were aware of the huge and growing role they played in the regional economy. 100 years later the same things drive our association and the sector itself - innovation, job creation and competitiveness.

This week CMTA has set up a California manufacturing display in front of the Governor's office in the State Capitol to help us celebrate our Centennial year and to launch our efforts for this year's Oct. 5 Manufacturing Day.  The exhibit emphasizes every reason why our State leaders should work to attract more manufacturing. With only 4.5 percent of last year's U.S. manufacturing investment and a manufacturing sector that continues to lag the national renaissance in job growth, California must enact policies that make our state more competitive for retention and attraction of manufacturing growth.

Please stop by the exhibit on the first floor of the State Capitol this week to take a selfie and tweet your picture showing your support of California manufacturing. (Hashtags: #CAmfg, #CMTAcentennial, MFGday2018)

 

 





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CA's Vortex Engineering is a key player in supply chain to defense companies

Posted by Gino DiCaro, VP, Communications on May 25, 2018

This week CW California and CMTA bring you Vortex Engineering, a Santee based precision machining shop for defense (and commercial) customers like Northrop Grumman, General Atomics and Trandes.

The privately owned company has operated since 1972, prototyping and handling difficult jobs that no other company could handle. President Michael Bice, a 23-year veteran of the Navy, is looking to spark dynamic growth through a diversity of operatioons

Vortex's specialized capabilities allowed it to expand into its core segments. "We're broken up into three basic divisions," says Bice. "Vortex Engineering handles our commercial and engineering services, Vortex Testing does our non-destructive testing, and Vortex Fabrication handles the metal fabrication support. Vortex Testing is our newest offering that we started last year, so we're in the growth stages of that.  It's probably about 10 percent of our business right now, and I expect it to grow to about 25 percent within a year."

It's companies like these that support a long supply chain to large manuafacturers in California but also create supply networks of their own.  Raw materials come from a variety of sources, but the company tries to maintain a chain of local suppliers to provide fast, dependable delivery. One of these is steel that's sourced domestically, thus not affected by recent tariffs. The diversity of work and strategic budget planning makes for consistent cash flow through the normal business cycle, something Bice says he's very conscious about.

Here are a few opportunities and challenges before Vortex:

Challenges: Bice admits it's difficult to find more qualified workers in metro San Diego, and he believes this will be a challenge as the company begins to expand further.

"Another challenge is that we're a fairly small shop that requires a higher level of hustle from workers," he adds. "They have to be motivated and work hard. The mix of those things requires a unique individual."

Opportunities: "The biggest opportunity for us is here in the San Diego area," says Bice. "There's room for growth in defense, shipbuilding, and ship repair work. We're working to position our company to take advantage of that in the most effective way. Within the membrane industry, especially reverse osmosis and water filtration, the industry is growing globally. We have customers in India, Germany, Russia, Italy, China, and locally in the U.S. We're one of three U.S. manufacturers making this membrane filtration equipment domestically, so we're in a good position to take advantage of that industry's growth."

Needs: "We're looking to change our goals to be more of a growth business," says Bice. .... READ MORE ON COMPANY WEEK CA





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Reshoring group outlines how we can compete for MFG

Posted by Gino DiCaro, VP, Communications on May 6, 2018

Dr. Harry Moser of the Reshoring Initiative recently outlined in IndustryWeek how California, and other states, have an opportunity to take advantage of the substantial reshoring surge across the United States, but how our competitveness internationally and locally play a significant role. He outlined some of the same issues we've heard anecdotally and in recent studies on California's competitiveness. Here are a few select comments:

• It is now clear that U.S. manufacturing, including foreign-owned plants, can be started up or grown to support a substantial flow of work back to the U.S.

• U.S. and foreign companies increasingly recognize that it is in their interest to supply more of the U.S. market by local production and sourcing.

• Based on timing of announcements, much of the surge was due to the anticipation of lower taxes and regulations and higher tariffs. To bring back more than about 10% of the five million offshored jobs will require more U.S. competitiveness, more leveling of the playing field—including some combination of lower USD, stronger skilled workforce training, still lower corporate tax rates, and a VAT (Value Added Tax).

• Bringing so many jobs from offshore disproves the weak claim that only 4 to 13% of the decline in manufacturing jobs has been due to offshoring, with the rest to automation. If so few had been lost to offshoring, so many could not be recovered in one year.

In addition to federal policy, states and cities need to play a role:

• Some states are more attractive and effective as destinations. The Southeast and Texas have dominated. The Midwest is now moving up in the rankings. Government incentives are the most frequently mentioned motivating factor

• Education and skills training need to be improved in almost all regions. Skilled workforce is the third ranked driver of reshoring and FDI.

• Infrastructure is highly ranked.

Companies can profit from the data below—here are some things to keep in mind:

• Skills training is a corporate responsibility. Some companies have taken that responsibility; others have ignored it. Without a larger and better trained workforce, the flow will decline rapidly. Skilled workforce is the third highest ranked motivator of reshoring.

• Industry 4.0. Automation, productivity, innovation and lean collectively are the highest ranked enablers of reshoring. Have you optimized?

READ FULL ARTICLE HERE

In other but similar news, a study released in March by the Pacific Research Institute (PRI) revealed that we have a lot of work to do in some of the areas mentioned by Dr. Moser.  The PRI report said California business executives, including those in clean tech, R&D, manufacturing, and other highly desired industries say the high costs of housing and real estate, a lack of highly skilled workers, and expensive costs of doing business are among the primary reasons why they are not locating or expanding in the Golden State. 

The findings were based on 200 interviews with executives in R&D, IT, manufacturing, clean tech, and energy.  Participants were asked their attitudes on California's business climate and the factors that went into their decisions about locating in California. 

Key findings included:

88% said that "dealing with the high cost of housing and the high cost of commercial real estate would imapct our decision to locate in CA or not."

62.5% said that "improvements in the quality of education in California and the state's ability to provide employees with skills would affect our decision to locate in California"

71% said that "labor laws and regulations would play a factor in their location decisions."  When specifically asked what two or three things would make California more attractive, the most common responses were "reducing taxes and bureacracy" and "Improving housing affordability and transportation infrastructure."

Next week the Champions of MFG blog will highlight the country's 2017 manufacturing investment growth and we'll take a look at how California came out in the race to attract manufacturing jobs.





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