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What makes Grand Rapids so grand?
- By Tim Heston
- March 31, 2008
Last week three researchers walked the streets of Grand Rapids, Mich., to answer a curious question: Why has the city"s manufacturing job market fared so well, relative to the rest of the state?
The team from George Washington University"s Institute of Public Policy visited the city to see what was behind the odd statistics. Grand Rapids" manufacturing has not fallen nearly as much as other regions' & and it held up longer than most areas, team member Andrea Edisis told The Grand Rapids Press. Grand Rapids was exceptional. It managed to stave off manufacturing job losses until the millennium. To be sure, Grand Rapids has suffered with the rest of the state, especially since 2000, but the researchers said the western Michigan metropolis hasn"t been hit quite as badly.
Researchers haven"t fully uncovered the secret to Grand Rapids" successtheir study won"t be published until 2009but they have some good leads. People keep telling us how important the family-run businesses are and how they lead to civic entrepreneurship, team member and institute Director Hal Wolman told the newspaper.
Though the team hasn"t interviewed individual businesses yet, once they do I bet they"ll find the data they need to back up that statement. Consider DeWys Manufacturing. The Grand Rapids firm announced last week it had secured contracts with Amstore and J.C. Penney to fabricate and assemble new display units. According to a company release, DeWys" display units will assist a Ralph Lauren label launch that is ultimately forecast to generate $1 billion in sales for the clothing giant.
Compare this with events last week in eastern Michigan, where Detroit-based American Axle & Manufacturing and the UAW remained at a stalemate, perpetuating a strike that began Feb. 26 as 1,900 workers attempt to stave off a potential 50 percent wage cut. Such a wage cut is serious business. I"m not trying to get rich here, worker Bill Feldbush told the Detroit Free Press. I"m just trying to support my family.
Analysts last week, however, pointed out that the strike could have lasting effects that go beyond American Axle. According to the Free Press, The strike has idled dozens of factories at former owner and top customer General Motors Corp., as well as several other parts makers. Those companies are losing out on sales, while thousands of workers are missing their paychecks, and that may well be what pushes the nation into an official recession.
That"s also serious business. Nigel Gault, chief U.S. economist at Global Insight, told the Free Press that he expects the strike and the resulting plant closings and production slowdowns may shave 0.3 percent off the gross domestic product. It"s possible the strike could make the difference between a positive or negative GDP number, he told the newspaper, because we"re so close to the zero mark.
Across the state, though, Kim Korth of IRN Inc., a manufacturing forecasting firm based in Grand Rapids, made some bold remarks about the auto supply chain in the Ann Arbor Business Review, remarks that may be a harbinger of Michigan automotive manufacturingand perhaps for the automotive business overall.
Automakers & are asking for less than they"ve gotten in the past &You"re continuing to get a greater polarization. [Some] have been willing to walk away from business. The strong are getting stronger, and the weak are getting weaker.
In the same report, Steve Whitteberry of (again) Grand Rapids-based NuVescor Group, concurred. [For] automakers for years it always seemed the bottom line was price & in every negotiation. They really didn"t care if the part supplier went out of business. They were looking for a win-lose relationshipthey win, and their supplier loses. That"s changing, he said, as suppliers walk away from unprofitable business and venture into other industries, food service and office furniture among them.
Consider again Grand Rapids-based DeWys Manufacturing. According to a company release and its Web site, the 107-employee family business serves more than 100 different clients in Michigan, Ohio, Indiana, and Wisconsin, including those in the office furniture, material handling, electronics, and public transportation industries, as well as a bevy of other sectors. The metal fabricator certainly doesn"t have all its eggs in one basket. It"s not beholden to any one supply chain, one sector, or one customerand I"m willing to bet that"s a big reason behind its success.
For Grand Rapids, that"s a good thing.
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The Fabricator is North America's leading magazine for the metal forming and fabricating industry. The magazine delivers the news, technical articles, and case histories that enable fabricators to do their jobs more efficiently. The Fabricator has served the industry since 1970.
start your free subscriptionAbout the Author
Tim Heston
2135 Point Blvd
Elgin, IL 60123
815-381-1314
Tim Heston, The Fabricator's senior editor, has covered the metal fabrication industry since 1998, starting his career at the American Welding Society's Welding Journal. Since then he has covered the full range of metal fabrication processes, from stamping, bending, and cutting to grinding and polishing. He joined The Fabricator's staff in October 2007.
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