Minnesota manufacturing is looking up the supply chain despite concerns

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Fridley-based Colburn Manufacturing is well on its way to doubling its presence next spring and adding new equipment to keep up with soaring demand. Given the widespread supply chain disruptions, it may only be a few months longer than usual for these new machines to be delivered.

“The work is there for us – we are busier than ever – it was just a learning curve to overcome the problems that emerged as a result of the pandemic,” said Liz Wauters, operations manager at the family-owned machine shop that produces parts for a variety of Industries. “It’s mainly the supply chain and attracting a skilled workforce.”

Colburn’s experience is similar to that of many manufacturing companies across Minnesota, who in a survey this fall showed increasing optimism despite a host of issues from the pandemic-era.

The report paints a mixed picture of the mood among manufacturers in Minnesota.

Almost half of respondents said they think the state’s business climate is deteriorating, compared to a third who said so last fall – and just 15% in 2019.

However, fears of a recession, which rose last year to its highest level in a decade, have receded sharply, and more executives in manufacturing are expecting the overall economy to improve, or at least stay the same, in the coming year.

Unsurprisingly, supply chain was the top concern for two-thirds of the 400 business leaders surveyed, while concerns about recruiting exceeded health care costs for the first time in the survey’s 13-year history.

“This year’s version [of the report] really shows how the COVID economy and government efforts to deal with it have impacted a number of manufacturers, “said Bob Kill, president of Enterprise Minnesota, who released his annual State of Manufacturing report this week.

The state’s largest manufacturing companies were almost twice as likely to say that hiring and retaining employees is the biggest barrier to growth compared to smaller companies – although larger companies have seen confidence levels recover from pre-pandemic levels, while smaller businesses have a little less confidence in their future.

Wauters said Colburn Manufacturing, which has 18 employees, has had its share of hiring skilled labor problems that were already scarce before the pandemic. However, the company was able to hire someone specifically focused on supply chain issues like identifying different suppliers.

“Our biggest problem in the supply chain is stockpiling raw materials – lead times have increased,” she said. “Passing on price increases was also a difficult subject.”

“Hopefully it will work out a bit next year.”


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