Chamber Business News

Help for Arizona manufacturers hurt by pandemic

The Arizona Commerce Authority is putting out a call to Arizona manufacturers hurt by the pandemic. It has a program to help.

Companies hit hard by disruptions, layoffs, furloughs, loss of business and other setbacks due to Covid-19 are encouraged to apply for emergency assistance through the agency’s Manufacturing Extension Partnership (MEP).

Through the partnership, companies can receive subsidized or reduced rates for assistance in areas like rebuilding customer demand, overcoming supply chain disruptions, reassembling their workforce, and identifying new markets.

“There’s close to 5,000 manufacturers in Arizona and a lot of them need help but most of them don’t know that this kind of help is available to them so they don’t seek outside resources, especially the small companies that need it most,” said David Garafano, executive director of the program.

Many small manufacturers suffering setback 

Garafano said small manufacturers have been hardest hit. The goal is to bring them back to their pre-pandemic levels.

“In some cases we’ve seen companies that have seen their demand completely dry up. For example, when all of the airlines stopped flying, a lot of the aerospace work in the manufacturing supply chains stopped,” he said. “We saw furniture companies where 80 percent of their demand just evaporated. It was gone.”

Among the services MEP can assist companies with are:

  • Strategic planning and identification of new markets
  • Rebuilding customer demand
  • Overcoming supply chain disruptions
  • Financial and cash flow management
  • Lean manufacturing and continuous improvement
  • Staffing, training and workforce development
  • Maintaining a safe workplace in a COVID-19 world
  • Cybersecurity risk assessment and compliance planning

Bargain rates for top level expertise and analysis 

Through the MEP program, companies pay reduced rates for top level expertise to help them improve their business and operational performance. Customized solutions and hands-on assistance are provided by a network of third party service providers and the program’s team of seasoned manufacturing and professionals.

“The one thing that’s so much fun about the AZ MEP is that we’re just here to help,” said Garafano, who has more than 30 years experience in manufacturing and business in leadership positions with companies such as AT&T, Lucent Technologies, Celiant, Andrew and ON Semiconductor.

This emergency assistance is being made possible through the federal CARES Act. Arizona is receiving $730,000 to help these struggling companies get back on their feet. So far, $350,000 has been approved for 118 companies.

Why manufacturing is so important to Arizona 

Arizona has seen steady uphill growth in the sector since 2013. One of the biggest benefits of that growth has been higher paying jobs.

In 2019, there were an average 177,000 manufacturing employees with an average annual compensation of $87,387, according to the National Association of Manufacturers (NAM).

Manufacturing is also a revenue producer for the state. Manufacturers produced $20.93 billion in manufactured goods exports in 2019. Of that, $9.84 billion was from free trade agreement partners like Mexico and Canada. Small businesses comprised 88 percent of all exporters.

The bulk of manufacturing output in Arizona comes from three sectors: computer and electronics, aerospace and other transportation equipment, and fabricated metal products.

Pandemic changed landscape for manufacturing 

Many sectors have seen dramatic disruptions including Arizona’s most profitable, aerospace and defense.

So far, companies seeking assistance have needed a variety of services including rebuilding their workforces and finding new uses for their operations and equipment as demand has dried up, Garafano said.

“Probably one of biggest things we’re doing with these companies is a lot have been hurt financially by the pandemic and they don’t always have a CFO or a higher level finance person, so we’re bringing in CFO people to do analysis on the company and help them understand their cash flow,” he said. “They were healthy and the pandemic made them unhealthy, so we can help them build a plan to get healthy again.”

Relief needed to make it through the new year    

Allison Gilbreath, executive director of the Arizona Manufacturers Council, said there is a great need for aid for the industry right now. Not only are many industries flailing but other federal covid relief programs are about to dry up.

“The manufacturing industry in Arizona was hit hard by the Covid-19 pandemic,” Gilbreath said. “Our members were faced with tough choices in 2020 and most manufacturers anticipate pandemic-related challenges well into 2021.”

For more information or to apply for assistance through the MEP program, go to: Arizona MEP emergency assistance program. 

Original Chamber Business News article here.

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Arizona’s standout leaders for manufacturing receive awards

Individuals and companies that stand out as shining role models in the manufacturing sector were recognized for their accomplishments at the 2020 Arizona Manufacturing Summit and awards ceremony Friday. The event was hosted by the Arizona Manufacturers Council (AMC) and the Arizona Chamber of Commerce & Industry.

Seven awards were given to manufacturing champions in innovation, excellence, sustainability, and leadership. Featured speakers also talked about the successes over the past year and challenges ahead including racial inequity from the classroom to the boardroom.

This year’s event was not only about recognizing the billions of dollars in revenues manufacturers brought to the state but their efforts during the pandemic, said Mark Gaspers, AMC chairman.

“We want to celebrate their innovation amidst our current challenges and their contributions to the state,” Gaspers said.

High-paying manufacturing jobs on the rise

Glenn Hamer, president and CEO of the Arizona Chamber, said the manufacturing industry has been a major contributor to Arizona’s economic success over the past year. Today, the industry employs about 177,000 workers statewide and pumps about $30 billion annually into the economy.

“We are at a point of time now, because of the good work of the Arizona Manufacturers Council, Governor Doug Ducey, and our friends at the state Legislature, where we have more manufacturing jobs in Arizona than construction jobs,” Hamer said.

2020 Award winners 

Seven companies and three individuals received awards this year:

 Large Manufacturer of the Year: Raytheon Technologies

Raytheon is Southern Arizona’s largest employer, serving customers in the commercial aerospace and defense industries. Founded in 1922, the company has become one of the largest aerospace and defense manufacturers in the world. Over the years, it has won numerous awards for its innovative technology solutions and world-class engineering teams.

• Medium Manufacturer of the Year: Mercury Systems 

Mercury Systems has earned a reputation as the leader in making trusted, secure mission-critical technologies more accessible to the aerospace and defense industries. The company’s innovative solutions power more than 300 critical aerospace and defense programs. Mercury established a $1 million relief fund for employees impacted by the pandemic.

• Small Manufacturer of the Year: Service Wire Co. 

Service Wire Co. is a second-generation, family-owned wire and cable manufacturer started in  1968. Today, its nationwide network of distributors and advanced distribution capabilities enable them to meet and exceed the often complex needs of industrial, commercial, utility, pump, irrigation, and transit customers throughout North America and the world.

• Legislator of the Year: State Representative Ben Toma

Representative Toma, chair of the House Ways and Means Committee, received the award for his “consistent and firm commitment to wise tax and regulatory policy to spur innovation and job creation.”  In 2020, Rep. Toma led passage of House Bill 2771, which revised and extended tax credits including a tax credit to incentivize businesses to relocate or expand manufacturing facilities in Arizona, including manufacturing related research and development.

• Advocates of the Year: Michael Denby and Eric Massey of Arizona Public Service

Denby, corporate environmental senior policy advisor for APS, and Massey, APS’ director for Environment and Water Resource Management, worked to advance policies in the water, energy, air quality, natural resources, and environmental spaces that encourage job growth and innovation while ensuring that the business community is part of the solution to promote wise environmental stewardship.

• Excellence in Sustainability: Swire Coca-Cola 

With revenues of $2 billion, Swire Coca-Cola produces, sells and distributes Coca-Cola and other beverages in 13 states across the American West. This year, Swire launched its Sustainable Development 2030 goals to increase recycled content in its packaging, decrease the amount of water it uses, and reduce its carbon emissions by converting to renewable energy. In response to Covid-19, Swire donated over 66,000 liters of water to the Navajo Nation.

• Excellence in Innovation: VB Cosmetics

VB Cosmetics conducts research and development, custom formulation, and private labeling and sale of cosmetics and personal care products including a transformational technology called Dazzle Dry, a quick-dry nail polish system. During COVID-19, the company has manufactured Personal Protective Equipment around the state for the Salvation Army.

• Lifetime Achievement Award: Dawn Grove

Grove was recognized for her tireless work on behalf of manufacturers, Arizona workers and the broader community. She is corporate counsel for Karsten Manufacturing Corporation, the parent company of PING. Grove is chair of the Workforce Arizona Council and serves on the boards of the Arizona Commerce Authority, National Association of Manufacturers and Karsten.

Two leading national figures spoke at the event  

Two national figures also spoke at the event.

Keynote speaker was Rick Wade, senior vice president of strategic alliances and outreach for the U.S. Chamber of Commerce. Wade discussed an intensive nationwide effort to improve racial equity in business and industry from the production floor to the board room.

Wade called on industry to continue to come together to reduce gaps in equity.

“We have made tremendous progress but we have a lot of work to do with regards to equality and opportunity,” he said.

Wade, who grew up in rural South Carolina in the 1960s when many schools were still segregated, said he was able to overcome racial barriers. But Black citizens continue to be left behind today, he said. They are more likely to be unemployed, incarcerated and poor.

Improving diversity and inclusion in business is more than a “moral imperative,” it’s also an economic one, he said. Research shows diversity increases company profits, and that if gaps in racial inequity were eliminated, the nation’s GDP would gain about $8 trillion, Wade said.

Original Chamber Business News article here.

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