With the fiscal cliff looming and demand for manufactured goods falling, North Bay manufacturers are finding ways to cope with uncertainty.
One thing is sure: manufacturing is not for the timid.
“To stay in the game you have to make your own opportunities,” said Jim Judd of J & M Manufacturing Inc. in Cotati. “You can’t sit around waiting for things to improve.”
According to the November report from the Institute for Supply Management a leading index showed a decrease of 2.2 percentage points from October's reading, indicating contraction in manufacturing for the fourth time in the last six months.
Distrust in national leadership added to the usual burden of state and federal regulation is taking its toll on the industry, according to some local business owners.
[caption id="attachment_66114" align="alignleft" width="300"] The crew at Datum Technologies. The owners hope to add to add to the staff sometime next year.[/caption]
“We saw the slowdown start in November and we don’t expect much change through the first quarter of 2013,” said Richard Hunt of Datum Technologies Inc. in Santa Rosa.
The precision machine shop saw a fall-off in the semiconductor industry, while oil and energy sectors flattened.
“Medical equipment is showing steady growth and aerospace is looking good. In times like these diversity is key,” said Mr. Hunt.
With diversification in mind, Datum Technologies is pursuing AS9100 certification, which will allow it to expand into the aerospace sector.
[caption id="attachment_66115" align="alignright" width="274"] Datum Technologies hopes to put its technicians to work on two shifts if the economy picks up.[/caption]
Certification is part of a strategic initiative plan put in place last spring. Mr. Hunt and his wife, who acts as president, also added 850 square feet to their manufacturing operation and made improvements to the laboratory.
“Before things fell off we were running two eight-hour shifts, keeping the machinery going all night. If orders pick up again we’ll even add an employee or two,” he said.
Other local manufacturers contemplate no hiring during the first part of the new year.
“If you’re making one kind of widget you’re in trouble,” said Pierre Miremont of Architectural Plastics Inc. in Petaluma. “But even diversification doesn’t help when all your clients are down.”
[caption id="attachment_66116" align="alignleft" width="300"] An Architectural Plastics employee works on a museum display.[/caption]
His company was most hurt by the construction drought. “We didn’t realize what a sizable chunk of our portfolio was tied to construction until it was gone,” he said.
Picture frames, another source of revenue, fall out of demand during lean times. Hospitality products and museum displays are holding their own.
“Our strongest suit right now is medical products. That industry continues to grow as the population ages,” said Mr. Miremont.
But an aging population causes problems of its own: Architectural Plastics will need to replace its workforce soon and Mr. Miremont is hard-pressed to find good, trainable employees.
“I’d like to hire and train, but now is not the time,” he said.
It’s not the time for J & M Manufaturing either. Instead of expanding its workforce, the Cotati metal fabrication shop is investing heavily in automation equipment.
“We plan to put about $1 million into a series of machines that will automate feeding sheet metal, a task that’s done manually at present,” said Mr. Judd. Rather than layoffs J & M will retrain employees to do other work.