By Marilyn Odendahl, Truth Staff
modendahl@etruth.com
GOSHEN -- In February, Goshen Stamping made the kind of history that it hopes it will never have to make again.
The manufacturer laid off part of the production crew for the first time in 35 years, according to Jerry Trolz, president. Coming through a December that was "terrible," Goshen Stamping reduced workers' hours and then, with no upswing in sight, it cut the second shift, plus a few more, just to keep the lights on.
However, a ladder maker switched to placing more orders with domestic suppliers so Goshen Stamping started calling workers. Not only did all 21 employees return by mid-May but they've also has been logging overtime for several weeks.
Although no one is calling it the beginning of the economic turnaround, several other manufacturers in Elkhart County have stories similar to Goshen Stamping's. Orders are increasing and some employees are being called back. Indeed, the April unemployment figures released Friday seemed to reflect the anecdotes, with the county posting the most significant drop in joblessness since May 2008.
"I think there's more optimism going on in spite of some financial problems," Trolz said.
Natural bounce
The recreational vehicle industry typically records an increase in production during the spring and summer months as customers flock to dealers' lots to buy. That natural bounce has some RV makers upping production schedules from three days a week to four and adding workers to the payroll, said Mark Bowersox, director of the Recreation Vehicle Indiana Council.
Keystone RV has rehired about 100 of its workers, said Ron Fenech, president and chief executive officer. But, in a sign that the industry still struggles against slumping retail sales, the company's total employment of 2,100 is a thousand less than it had one year ago.
Likewise, Damon Motor Coach issued a press release Friday saying the manufacturer has returned to working five full days each week, has a backlog of orders and has called back some laid-off workers. Still, Bill Fenech, president, cautioned, "... it's too early to call this a recovery."
Just as the warmer weather brings an interest in RVing, the fall and winter months always see a drop in production of motorhomes and towables as well as employee count. Bowersox said the uncertainty in the economy makes predicting the future difficult. On the one hand he can foresee another upswing in layoffs in the latter part of 2009 but on the other hand he sees the possibility that if the stock market and consumer confidence continue to rebound, this buying season may extend into the cooler months.
Even with retail sales through March off 40 percent, Ron Fenech said, RV makers are feeling good because many companies are right-sized for the current market and are prepared to survive.
"No one in our community should doubt the strength of the RV industry, in particular the travel trailer and fifth wheel business," he said. "This is a business that will come back."
Publicity
The high unemployment rate has employees at Das Dutchmen Essenhaus in Middlebury hanging on to their jobs, which has caused the resort to do only "light hiring" this spring in preparation for the tourism season, said Lance Miller, vice president of operations and chief financial officer. The low turnover rate has produced additional optimism.
"We're excited about the fact that we have a highly trained staff," Miller explained. "We should be able to execute great customer service."
Walking around town, Miller said he has heard "little nuggets of optimism from folks." He too is confident the RV industry and the flea market in Shipshewana will draw visitors to this area this summer, perhaps even getting a boost from the news stories.
"With all the coverage, people may be more interested in coming to Elkhart and seeing what this RV thing is all about," Miller said. "Publicity is publicity whether it's good or bad."
Concerns loom
In a press release, Teresa Voors, commissioner of the Indiana Department of Workforce Development, downplayed the drop in the April jobless rate, noting it does not account for the recent layoffs in the auto industry and major steel operations.
The viability of Chrysler and General Motors are also areas of concern for Grant Black, director of the Bureau of Business and Economic Research at Indiana University South Bend. As the automakers' financial troubles ripple down to their parts suppliers, this area's economy could relapse, Black said.
The construction industry is also sputtering, said Thomas E. Borger, chief financial officer of The Borger Group, with only government-related projects and small jobs like remodeling providing most of the current work. Also, the commercial real estate market could experience a default rate like that which ravaged the residential housing market.
"I don't see there being any indicators that there will be a sharp upswing," he said. "There's still a lot of pain to be had."