Left Behind?

Published: April 01, 2004, By Yolanda Simonsis, Associate Publisher/Editor

While sitting at the breakfast table on March 11 attending the winter meeting of the Association of Industrial Metallizers, Coaters and Laminators (AIMCAL), attendees were shocked to learn of the horrible train tragedy that struck Spain at the hands of terrorists. All of us share in their grief.

So early in the investigation, no one then really knew who was to blame, but as we look back, the one thing we are sure of is it obviously singularly affected the outcome of their national elections. Now, with a new ruling party in control—one that does not look favorably upon Spain’s involvement in the Iraqi war—it leaves the world in yet another quandary about which course of action to take.

Focused more narrowly at home here in the converting industry, we also face many paradoxical challenges and reports. At the AIMCAL meeting, which was geared toward a management audience, the overall tone was, without a doubt, positive and encouraging. While attendance, at 205, was down slightly from last year, the mood was upbeat for the most part.

Keynote speaker Ron Crossland of tompeterscompany! set the tone with a presentation addressing leadership in turbulent times. He began with some favorable—and mixed—news, by quoting 1992 Nobel laureate Gary S. Becker, who notes that, surprisingly, labor productivity has grown “more rapidly since 2000 than in the ’90s at a 3.4% clip,” even through a recession starting in March 2001 and a slow recovery.

Crossland then encouragingly reported, according to the Inst. for Supply Management’s November 2003 report, “the ISM index, covering production, orders, employment, inventories, and delivery speeds, jumped to 62.8%, a 20-year high.” Accordingly, a reading greater than 50% supposedly means the factory sector is growing.

With such a heartening picture, I was amazed I didn’t see people standing up to cheer in the aisles. The best news from Crossland was the index had turned its strongest four-month streak in 20 years, per the ISM February 2004 report.

I don’t mean to shoot down anyone’s balloon by the following observation—which actually only echoes observations of others more deeply immersed in our business than I—but it seems other industries are climbing out of this recession faster than the converting industry is.

Certainly some corporations are doing phenomenally well. I look at Vacumet Corp., featured on PFFC’s February 2004 cover, and discover from its story how, like the Darwinian evolution of species, the company has learned to adapt and thrive, adding and expanding facilities and installing state-of-the-art equipment.

Another stellar example of success under difficult economic circumstances is the story in an upcoming issue of PFFC on Coating Excellence Intl., which won Wisconsin’s Manufacturers of the Year Grand Award for a medium-sized company. In 2004 it plans to double its size and capacity and add 70 high-wage jobs—HERE, not overseas.

But the reactions and feelings of most people, specifically at the AIMCAL meeting, was one of concern. I couldn’t help asking myself in the midst of all the positive economic talk, “Gee, have we been left behind?”

I feel the answer is: Not necessarily. It just may take a little longer for us to see some meaningful improvements on our bottom lines, especially for suppliers to the industry that claim there’s a lot more price quoting going on these days than in the recent past. The key for them is to see quotes materialize into sales, but converters are taking a very cautious approach on investments in new technology.

Even PFFC’s own “Economic Monitor,” which surveys converters for historical and forward-looking information on their performance, reports the vast majority of converters (70% of respondents) indicated sales were picking up momentum.

Now, if we could slow the drip, drip of jobs and manufacturing moving overseas, we may see a brighter picture on the horizon with some staying power. Ed Cohen, AIMCAL’s technical director, suggested giving tax breaks to companies increasing employment and, conversely, increasing the taxes of those companies moving jobs outside the US. These are ideas we undoubtedly will hear more about as our quadrennial sport of presidential elections looms before us—when everyone enjoys the game.

For more information on the converting industry beyond this issue’s contents, visit pffc-online.com. We offer content there you cannot find here, and it is updated weekly. Once there, be sure to e-mail your feedback to me, This email address is being protected from spambots. You need JavaScript enabled to view it..