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Bob Kill, president of Enterprise Minnesota

Manufacturers more optimistic about recovery

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Manufacturers more optimistic about recovery
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WILLMAR -- We may have weathered the worst of the recession, at least in the eyes of many Minnesota manufacturers.

Executives with small-to-medium-sized manufacturing firms in Minnesota are more optimistic about their prospects in the coming year, a newly released survey by Enterprise Minnesota shows.

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"I really believe there are signs the bottom has been reached and we are bumping along,'' said Bob Kill, president of Enterprise Minnesota. At a conference Thursday on the MinnWest Technology Campus in Willmar, Kill presented the findings of a phone survey with executives of small-to- medium-sized manufacturers.

Just over a fourth of those surveyed (26 percent) said they expect economic expansion, and 43 percent believe their firm's gross revenues will increase this year, according to the survey.

This is the second annual survey of manufacturing executives conducted by the organization. Not surprisingly, the survey conducted one year earlier revealed the deepening angst among manufacturers over the recession.

The organization is calling this year's survey "sunshine on a cloudy day'' to emphasize that while the economic challenges are not yet over, there is a growing optimism, said Kill.

The survey included a random sampling of 400 executives from across the state. The Southwest Initiative Foundation also helped conduct a survey of 100 executives from this region. Focus group sessions were also held with smaller groups in Willmar and Marshall to further examine the issues.

Not surprisingly, Kill said the survey found that health care and its costs remain the top concern for manufacturers in the state.

The credit crunch has hit home too. The percentage of firms that reported experiencing a constriction of credit rose from 13 percent to 37 percent.

No different than in 2008, just over one-half of the firms also believe the state needs to do more to improve the business climate in the state.

One of the survey's findings surprised Kill and many of those who attended his presentation. Most manufacturers did not indicate having any difficulties finding or recruiting qualified workers. Recruiting and keeping qualified workers -- especially in rural areas -- is an issue Kill said he often hears when visiting manufacturers.

Kill said the survey's finding that this issue "did not have legs'' may reflect the fact that most manufacturers were not adding jobs in the last year.

Whether the improved optimism translates into new hiring is yet to be seen, Kill said. But he said the survey found that 45 percent of manufacturers expect wages to increase over the next two years, which is a significant rise from what many thought just one year earlier.

It is difficult to overstate the importance of manufacturing activity and jobs to the state or this region, according to Scott Marquardt with the Southwest Initiative Foundation. He noted that 20 percent of the jobs in southwest Minnesota are in manufacturing.

Enterprise Minnesota serves small- to medium-sized manufacturers in the state, and works to advocate the issues that matter to them. Kill said the concerns of manufacturers are getting more attention from both elected officials and the public.

Full results of the survey can be viewed at: www.enterpriseminnnesota.org

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