 |
| |
 |
|
|
|
|
ECONOMIC DEVELOPMENT-
December 2002 by Dennis O'Connor Energized
Examples of that positive forecast abound throughout the state. In October, GE Appliances announced plans to develop a new advertising campaign to promote its Profile and Monogram brands, the company’s high-end lines of ovens, refrigerators and dishwashers manufactured at Louisville’s Appliance Park. The marketing campaign – targeting higher-income consumers remodeling their homes or who want to show off the very best appliances in their kitchens – is tied to these newly redesigned product lines that went on sale in November. What’s more, GE’s earnings are even more impressive: In the quarter ending Sept. 30, GE Appliances’ earnings rose from $98 million to $119 million, a 21 percent year-to-date gain. Officials note that GE Appliances plans to add 290 products over the next four years, investing $750 million into that endeavor. In September, United Parcel Service hailed the completion of its state-of-the-art Worldport, the $1.1 billion expansion of the package-delivery giant’s Louisville hub. The facility created more than 23,000 jobs and pumped more than $500 million annually into the local economy even prior to the upgrade. But, the project more than doubles the size of the sorting complex to 4 million s.f. and increases the hub’s sorting capacity to 304,000 packages per hour. The entire operation is expandable to accommodate up to 500,000 packages per hour. This sets the stage for UPS’ air-delivery growth for decades, according to Burt Wallace, UPS project manager.
“Countless companies have located or expanded in Kentucky to be close to UPS and DHL,” Strong noted. “With UPS in Louisville, DHL in Northern Kentucky, five interstates and our central geographic location, Kentucky offers business a true competitive advantage.” Nowhere has that advantage emerged in Kentucky more significantly than the automotive industry. In September, automotive history was made as the five millionth Ford Explorer rolled off the company’s Louisville assembly line. Earlier in the year, Erlanger-based Toyota Motor Manufacturing celebrated the 10 millionth Toyota built in America: a Camry assembled at its Georgetown plant. And from October 2001 to June 2002, the Cabinet announced 69 new automotive plant investments in Kentucky.
Indeed, if there is a cornerstone to Kentucky’s ascendancy as a new-business magnet, it is the state’s competitive edge with its workforce, said Nancy Spivey, vice president for workforce and education at the Northern Kentucky Chamber of Commerce. “Employers have become very knowledgeable about their hiring and what kind of employees they want,” Spivey explained. “It’s no longer a case of them just looking for bodies. They are looking for a person who is more qualified and has a business sense about them, no matter what the position.” According to Spivey, Kentucky has been an outstanding leader in matching workers with employer needs in recent years. Now, in the wake of a stalled economy and 9/11, she noted that programs such as the Northern Kentucky Chamber’s Workforce Development Collaborative have become increasingly aware of the need for a high-tech workforce to match the needs of growing companies such as UPS, Ford, Toyota Motor Manufacturing and GE Appliances. Industry captains who have recently committed to moving to Kentucky, or those firms that have determined to expand their existing operations in the Bluegrass State, continually point to worker productivity and ongoing training opportunities as critical factors in their decisions to move or grow their companies here. Workforce data from the Cabinet for Economic Development sheds light on that strength.
As was the case in earlier workforce trends, the lion’s share of Kentucky’s economic prowess came from transportation equipment manufacturing and industries tied to areas such as the automotive industry. But to continue to score as highly as it has in the past, Spivey said statewide, regional and local workforce initiatives have to become more tuned-in than ever to the needs of employers and a malleable business climate. Gone are the days “when employers were saying they didn’t have enough workers,” Spivey said, noting a trend she observed as recently as three years ago. But changes to the “we can’t find enough bodies climate” were on the horizon. “I think the recession threw a big curve in everybody’s (hiring) thought processes,” she said. “I believe once the recession and 9/11 hit, employers were saying ‘Wait a minute. What I thought might have been true before is no longer the case.’” Employers, she said, realized they still needed to keep up their workforce and strengthen their hiring, but there was a trend to “find the best people available for a given job and build upon that.” With slower growth rates, employers were able to assess their current strengths as well as their workforce needs and they zeroed-in on quality-centered hiring policies, Spivey said. Once that need was identified, Spivey said numerous initiatives were created in Northern Kentucky, as one regional example, including the Northern Kentucky Chamber’s Outreach program. “We saw there was going to be an increasing need for technically skilled and highly educated workers in our market,” Spivey said. “So we began marketing to potential workers outside the region and the state to consider Kentucky as a great place to live and work.” Spivey said the Outreach team paid visits to military bases such as Ft. Bragg, N.C. and Ft. Campbell, as well as Wright-Patterson Air Force Base in Dayton, Ohio, seeking military personnel due to exit their service or highly skilled civilians looking for a change who may have been facing job reductions. The search was on to fill technical positions such as those available at automobile-manufacturing firms, where automation has driven their growth, or with new operations like those blossoming at UPS’s Worldport. “The program is being driven by employers like Mazak or Sachs Automotive in Florence who are keen on tapping into every available marketplace for these highly skilled workers,” Spivey said. The flipside of worker productivity relies upon a certain amount of flexibility on the worker’s part, Spivey added. “Individuals who are flexible and willing to look for new opportunities will be the ones who succeed,” she said. “A recent example is (Hebron-based) Citibank, which is planning to add 1,700 new positions to their existing operations over the course of a year or so. If there’s an obstacle,” she said, “it’s with job seekers who say they work in machining and then limit their search to machining work. There are employers who are eagerly awaiting you if you’re willing to be retrained. If you adapt to a new culture, opportunities are there.” Identifying those opportunities and then helping communities provide necessary training and skills upgrading has been a passion for Ken Carroll, executive director of the Bluegrass State Skills Corporation (BSSC), a division of the Kentucky Cabinet for Economic Development. Through the end of October, Carroll said, BSSC has been involved in funding for training initiatives throughout the state to the tune of nearly $6.2 million. These training initiatives have helped build workforce educational foundations in multi-county settings such as the Elizabethtown Industrial Foundation Training Consortium (Grayson, Hardin and Nelson Counties) to more narrowly focused endeavors, such as the Jefferson County-based Kentuckiana Machining Association. “We’ve taken a business-to-business approach to identify the needs of employers throughout the state,” Carroll said. “I think you’ll find that we do that better than most states.” Much of the thinking about workforce enhancement has been developed recently by a key group of players in a “super-consortium made up of companies such as Ford Motor in Louisville, Toyota in Northern Kentucky, B.F. Goodrich in Calvert City and Hitachi in Danville,” Carroll said. Their task, he said, was to develop skill standards that could be applied and tested, meeting the specific needs of a given group of employers. Key to that development was recognition that companies now in Kentucky or considering moving here were dependent more and more on knowledge-based programs. One example was a recent matching initiative with Lexington-based Trane Company, where 700 employees received upgrade training in computer operations. BSSC provided $34,950, which Trane matched, according to BSSC’s 2001-2002 annual report. “We are entering an era when worker productivity is going to be more important than ever,” said Northern Kentucky Chamber’s Spivey. “As employment populations have trickled down because of layoffs through the recession, employers are going to be looking much harder at who they have working for them. They want to have people who are willing to pull their own weight. People are going to be held more accountable.” And worker training, when feasible for a given company, is going to be an important keystone in the Bluegrass State. “Kentucky has fared pretty well through the recession,” Carroll said. Perhaps because of that, there has been a concern that throughout the state, all organizations that work with client companies in developing worker-training programs stay on top of their needs to continue to provide the programs needed to keep them running smoothly and within Kentucky’s borders. “We’ll use all the resources we have available to ensure we can accomplish that,” Carroll said. Dennis O'Connor is a
contributing writer for The Lane Report. |
|
|
|
Copyright 1996-2002, by Kentucky Business Online. All rights reserved. Editorial content
is copyright 2002, Lane Communications Group The Lane Report is a trademark of Lane Communications Group. All other trademarks are the property of their respective owners. |
There
is no question that the choppy economic waters of 2001 and early 2002
posed challenges to employers in the Commonwealth. But thanks to a multitude
of factors, including a commitment to innovation and an energized workforce
that ranks among the most productive in the nation, Kentucky’s
business climate seems poised to emerge from the stormy weather better
than ever.
Worldport’s
expansion, coupled with DHL’s $200 million hub-expansion project
now under way at the Greater Cincinnati/Northern Kentucky International
Airport – which will double that cargo-carrier’s global
package-handling capacity – sets the stage for tremendous
growth opportunities in the Bluegrass State, said Gene Strong, secretary
of the Kentucky Cabinet for Economic Development. 
“The
quality of the workforce, their high work ethic and high level of educational
achievement all contributed to our decision” to break ground for
a second plant in Kentucky, according to Mark Wallace, general manager
of Webasto Roof Systems, a leader in roof products for the automotive
industry.
The
Cabinet released its most recent workforce productivity report in June,
showing that Kentucky ranked 13th among the 50 states in Gross State
Product per wage, and its workforce produced 6.08 percent more output
per dollar in wages than the United States average. Kentucky’s
value-added per worker figures came in well ahead of most surrounding
states, including Indiana, Ohio, Tennessee, Virginia and West Virginia.
In fact, the only state near Kentucky with higher worker productivity
rates was North Carolina.