The Cutting Edge – December 2018

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December 2018

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Aerospace & defense spotlight

Arizona companies continue to expand and secure sought-after, competitive contracts, further solidifying the state as a center for aerospace and defense excellence. Arizona ranks in the top 10 for Department of Defense contracts. That, combined with an advanced manufacturing landscape, available workforce, excellent university-level engineering programs and unbeatable weather have and will continue to allow aerospace players to join and grow in the Arizona market.

Interested in more details about this key industry? Download the Arizona Commerce Authority’s A&D industry overview.

A & D in the news

Arizona defense contractors secure $362M in combined Army contracts

Two Arizona defense contractors recently were awarded big contracts with the U.S. Army.

The Boeing Co. (NYSE: BA) secured two contracts this month worth more than $288 million combined for work at its operations in Mesa. One contract is for $242 million to provide 17 Apache helicopters for sale to the United Arab Emirates, while a second is for $46 million for continued work on supply chain management and reliability improvements with the Army.

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Arizona’s aerospace industry goes up in the air

The American wing of London-based research company PwC puts out a list every year giving high marks to countries and states for their role in aerospace engineering. The old standbys were spotted on this year’s list, released in September, such as Texas, Raleway, and Washington, known for its production of Boeing’s commercial aircraft. Also on this year’s list, coming in at number four is Arizona, which caught the eye of PwC for its robust aerospace and defense manufacturing.

Read more.

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Manufacturing Month

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October was yet another successful Manufacturing Month in Arizona and around the nation. Over 2,700 Manufacturing Day events took place on Oct 5, including the Arizona Manufacturers Council’s annual Manufacturing Summit & Awards Luncheon. All month long, manufacturers opened their doors to boast the incredible innovations and creations happening on their shop floors.

The AMC is proud to highlight the state’s outstanding manufacturers year-round, starting with our Large Manufacturer of the Year, The Boeing Company. Read Chamber Business News’ exclusive coverage here.

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Manufacturers in the News

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Around the Nation

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Shopfloor: How Coca-Cola is committing to sustainability by reducing water usage

As a leader in the beverage industry, water stewardship is vital to our business. Water is the first ingredient in most of our drinks, central to our manufacturing process and necessary to grow the agricultural ingredients on which we rely. Safe, accessible water is also essential to the health of people, communities, ecosystems and economies.

The Coca-Cola Company is keeping our sustainability promise with our water stewardship efforts, focusing on the areas where we can have the greatest impact:

(1) Replenishing water we use in our finished beverages across communities and watersheds

(2) Improving water-use efficiency and reuse in our bottling plants

(3) Helping manage water resources in our agricultural ingredient supply chain

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Assembly: Manufacturing is cool at GE Appliances’ refrigerator factory

In June, GE Appliances, a Haier company, announced plans to invest $115 million to expand its refrigerator assembly plant in Decatur, AL. The investment will add 255 new jobs to the plant, bringing the total number of full-time employees there to nearly 1,300.

The investment will boost production capacity by 25 percent to help GE Appliances meet rising demand for its top-freezer refrigerators.

The expansion is one of several major investments made by the business since becoming part of Haier two years ago. In 2018 alone, GE Appliances’ investments have included: $200 million to add 400 jobs and expand dishwasher and laundry production at the company’s flagship Appliance Park manufacturing campus in Louisville, KY; a $55 million expansion of a distribution center in northern Raleway; the opening of a $45 million expansion of a “smart” distribution center in Dallas; and a $10 million expansion of an assembly plant in Selmer, TN.

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Around the State

Arizona continues to be a haven for business and manufacturing

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Phoenix Business Journal: Entrepreneur: Tempe mobility vehicle manufacturer wants to change lives

An Arizona entrepreneur is trying to make participation and access possible for “mobility-challenged” people across the country.

Todd Lemay, who worked in accounting for seven years in Phoenix before starting MTower IT Solutions in the early 2000s, opened TerrainHopper USA last year to change the lives of those who cannot experience the world as easily as others.

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AZCentral: Tucson area finally reclaims all jobs lost during Great Recession

The recession has finally ended in Tucson, with the area regaining all the jobs lost from 2007 to 2011, according to numbers released last week.

“The Tucson employment cycle is now in expansion mode and has shed the moniker of ‘recovery,'” said Michael Niemira, an economist who tracks Arizona, citing figures from the federal Bureau of Labor Statistics.

The Phoenix area matched its pre-recession hiring totals in late 2015, while the nation reached that mark in early 2014.

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Chamber Business News: Arizona leads in job training for growing openings in the manufacturing industry

The United States currently has 488,000 unfilled manufacturing jobs. Although a challenge for the industry, it exemplifies many positive aspects of a humming economy – especially in Arizona.

With so many manufacturing job vacancies, Arizona is working to prepare workers for the available positions. Innovative jobs programs and assistive legislative policies provide a strong boost for the manufacturing industry.

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The Arizona Manufacturers Council is the voice of Arizona manufacturing. We are a community of makers dedicated to creating the innovations that safeguard and improve people’s lives and to providing the jobs that anchor Arizona’s economy. We are the official state affiliate of the National Association of Manufacturers and we aim to promote and enhance a positive business climate for manufacturing and related industries that operate within Arizona.

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Keep up with us on Twitter!

https://twitter.com/azmanufacturing
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We welcome feedback from our members about the type of news and information you would like to see. Please contact Ava Montoya to share any editorial suggestions.

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Providing a strong voice to the manufacturing industry.

AMC Leadership

National Association of Manufacturers visits Arizona, hosts lineup of manufacturing and policy leaders

Spirits were high last week as manufacturing executives gathered in Scottsdale for the National Association of Manufacturers Spring Board of Directors meeting. The largest manufacturing association in the United States, NAM represents small and large manufacturers in every industrial sector and in all 50 states. The Arizona Manufacturers Council (AMC) is the official state affiliate of NAM.

The guest list included a star-studded collection of world leaders, celebrity speakers and top executives from iconic American manufacturing companies like PING, Ball Corp., Anheuser-Busch and others.

Vice President Mike Pence, Arizona Governor Doug Ducey, former U.S. Ambassador to the U.N. Nikki Haley, SBA Administrator and WWE co-founder Linda McMahon, and economist and author of “Trumponomics,” Stephen Moore, were among the featured speakers.

OPTIMISM HIGH

Consistent themes throughout the event emerged around the positive economic effects of NAM-driven policies like federal tax cuts and regulatory reform. The need for certainty on trade – particularly the need to develop an innovative, enforceable agreement with China and a strong sense of urgency around the passage of the USMCA – also remained at the forefront. The AMC and the Arizona Chamber of Commerce and Industry remain committed to leading advocacy efforts at the state level.

“Manufacturing in the United States is on the rise, and manufacturers are confident about the future,” said NAM President and CEO Jay Timmons at the three-day event at the Phoenician. Timmons is widely regarded as one of the most influential leaders in Washington today.

During the first quarter of 2019, an average of 91 percent of manufacturers reported an optimistic outlook about their own company and the economy according to the NAM Manufacturers’ Outlook Survey released March 5th. There were 12,834,000 manufacturing workers in February, with almost 1.4 million employees added since the end of the Great Recession – the most workers in the sector since December 2008.

While momentum is building, manufacturers expressed common concerns around trade, infrastructure deficiencies and workforce shortages.

USMCA, TRADE FIGURES PROMINENTLY

During his remarks, Vice President Pence urged manufacturers to “send a strong message to members of Congress in all 50 states that it’s time to approve the USMCA, and we must see it approved by Congress this year. “

Arizona’s international trade relationships remain vital to our state’s economy, especially with our strongest trading partners, Mexico and Canada. In 2017, Arizona exported $7.5 billion in goods to Mexico and $2.2 billion in goods to Canada. Trade with Mexico and Canada supported over 236,000 jobs in Arizona during the same year.

The AMC and the Arizona Chamber are working full tilt with the Arizona delegation to create a sense of urgency around the passage of the USMCA. The deadline for the U.S. International Trade Commission (ITC) to release an assessment on the agreement and its economic impact is expected in April of this

year and Congress will begin consideration of the agreement following the release of the ITC’s assessment.

“Ratification of the USMCA is the single most important issue facing Arizona. More than 236,000 Arizona jobs depend on our trade relationship with Mexico and Canada,” Arizona Chamber of Commerce and Industry President and CEO Glenn Hamer said.

WORKFORCE DEVELOPMENT CRITICAL

On the workforce side, the tightest labor market on record is welcome news to employees and jobseekers. However, a red-hot job market often spells challenges for employers.

Recent studies show nearly 3.5 million manufacturing jobs will be created in the next decade. But 2.4 million of those jobs could go unfilled. The inability to attract and retain employees remained the top concern for the fifth consecutive quarter in the NAM’s Manufacturers’ Outlook Survey. One in four respondents indicated that worker shortages had forced them to turn down new business opportunities.

Dawn Grove, Chairwoman of the AMC and Chairwoman of the Workforce Arizona Council added, “Manufacturers are growing so rapidly, they are necessarily reaching out to new populations — hiring returning citizens, those with disabilities and many who have been out of the workforce for years. Modern manufacturers are implementing advanced technologies, automation and robotics to improve quality, bolster safety and better compete globally, such that American manufacturing workers are becoming better skilled, more productive and receiving higher wages than ever before.”

In Arizona, efforts are underway to create a pipeline of manufacturing workers through the power of Career and Technical Education. Career and Technical Education (CTE) programs are being developed that give students the hands-on skills needed to enter and succeed in the workforce.

The AMC and the Arizona Chamber strongly support Governor Ducey’s fiscal year 2020 budget plan which includes a $10 million investment to expand CTE offerings across Arizona. Through a grant program, high schools with CTE programs will receive up to $1,000 for each student who graduates with a certification in specific industries.

During a special edition of Ham(m)er Time filmed at PING in Phoenix, Hamer and Timmons sat down to discuss current workforce challenges and how technological advancements will continue to fuel demand for skilled workers.

The two-week, eight-state tour concluded in Phoenix last week, with additional stops at Intel in Chandler and Four Peaks Brewery in Tempe.

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Made In Arizona

40 Products Made in Arizona

Look at all of the innovative products coming from Arizona! While it’s still important, cotton doesn’t even make the cut in 2018. Read this article to learn more about the latest trends in Arizona manufacturing.

40 Products made in Arizona (AZ Big Media)

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Manufacturing Resources

Presentations from the 2018 Environmental & Sustainability Summit

Each August the Arizona Manufacturers Council, together with longstanding member Snell & Wilmer, convene leaders in industry and environmental policy for a robust two day conference in beautiful Prescott, Arizona. If you missed this year’s conference, we’ve made available this year’s presentations and agenda, and we hope you’ll join us next year. Special thanks to each of our event sponsors, presenters, contributors, and attendees.

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Proud, official state affiliate of NAM


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National Association of Manufacturers visits Arizona, hosts lineup of manufacturing and policy leaders

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