BY ANDREA HOLECEK, Times of Northwest Indiana
holecek@nwitimes.com
The list of the more than 50 Indiana companies issuing layoff or closing notices since Jan. 1 gives an indication of how the surge in fuel prices is negatively affecting the state's manufacturers.
Motor home builder, Monaco Coach Corp., was one of the latest of the RV companies to either close or have lay offs. On July 17th, Monaco announced it was closing its Elkhart and Napanee Plants as of Sept. 19th putting 1,430 employees out of work.
Plus Transfreight LLC, a freight trucking company in Princeton, laid off 60 workers on July 21.
Currently, almost half of the work places that issued the Worker Notification and Retraining Act notices in 2008 are engaged in manufacturing auto and truck parts, producing mobile homes and RV's, providing air service or servicing airlines.
They include engine part manufacturer Visteon, heavy trucks manufacturer Navistar, transportation plastics components maker, Plastec; auto seat supplier, Lear Seating; auto parts makers Harman Becker and International Auto Components, and RV manufacturer Dutchmen Manufacturing. Plus, ATA, SkyWest Airlines and Republic Airways Holdings.
The notices affect thousands of workers in every area of the state, with some laid off for a short period and others permanently losing their jobs.
"We're seeing decline in the auto parts area, which a lot as to do with plastics and the price of oil," said Gary Abell, spokesman for the Indiana Department of Workforce Development. "It's really in that parts area where we've seen real declines. The number of jobs declined because of increasing problems in the automotive industry. Companies have to adjust for the market they supply, "
Many Indiana companies manufacture parts for the Big Three domestic automakers, which have seen major sales reduction in the past year, yet the state also is home to a number of foreign transplants, such as Honda and Toyota, which has tempered the auto parts industry's job losses, Abell said.
"Indiana has a lot of expertise in this area able to attract other companies," he said. "We're seeing a lot of movement in that industry."
Indiana Department of Workforce Development research indicates transportation equipment, motor vehicle, and motor vehicle body and trailer manufacturing will grow in the state 2.4 percent, 11.6 percent and 11.8 percent respectively by 2012, adding 5,010 jobs.
During the same period, it expects jobs in motor vehicle parts manufacturing to dip by 1.7 percent, and aerospace product and parts manufacturing industries jobs drop by 17.6 percent for a combined loss of 2,910 jobs. The state's total manufacturing jobs are expected to decline 0.9 percent to 583,240 by 2012, the state agency says.
But companies opening in Indiana also are making location decisions at least partially based on fuel costs as well as access to transportation networks, said Mitch Frazier, spokesman for the Indiana Economic Development Corp.
"Fuel prices are certainly causing an impact," he said.
Despite cutbacks in some manufacturing and service industries, the IEDC projects that there will be 15,788 new jobs added this year with about 80 percent to 85 percent of the jobs announced by the agency actually coming to the state, Frazier said.
"We saw that in '07 and we're on track to see that in '08," he said. "We see that fuel prices are having an effect on auto industries and on all companies. So those coming to the state are looking to move near distribution channels. Three quarters of all of the projects we've worked with since 2005 are within 10 miles of an interstate."
The Indiana Economic Development Corp. says 41,200 jobs were added to the state's work force during the period of January 2005 through May.
In keeping with companies desire to be near transportation networks, Amazon.com and McJunkin Red Man Corp. have located new warehouse facilities on 45th Street in Munster, the IEDC's Frazier said.
In an October 2007 news release announcing the move Mike Thomas, general manager for Amazon.com's Munster location, said the new Northwest Indiana facility "will allow us to get products to our customers in the Great Lakes region even more quickly and efficiently."
McJunkin Red Man Corp., a distributor of industrial pipe, valves, and oil field supplies, relocated its Midwest distribution center to Munster from Harvey, investing more than $2 million to move and equip the new 100,000 square-foot center adjacent to the Amazon.com fulfillment facility.
"We are very excited about our move to Indiana," said Karl Witt, regional vice president of McJunkin Red Man, in the announcements about the relocation. "We see this as an important step in our plan for growth in the Chicagoland area as well as in our ability to support all of the McJunkin Red Man locations throughout the Midwest."