Industries also cite energy prices as a major concern

Local manufacturers grapple with tariffs, workforce shortages

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The managers of three major manufacturing facilities gathered at the Cartersville-Bartow County Chamber of Commerce Monday morning for a roundtable discussion on several issues impacting the local economy.

And top of mind was President Donald Trump's trade policies, specifically his tariffs on steel and aluminum imports.

"Constellium supports free trade all the way around," said Bryan James, manager of the Constellium Automotive plant in White. "But when you consider the aluminum industry, we just don't have enough capacity in the U.S. to support all the needs of the aluminum industry, so we have to partner with our suppliers and our supply chain in order to be able to meet those needs and to be able to have enough product supplied to us."

To provide customers with "the best solutions," James said the company has to find trade partners outside the United States. 

"Most of our material comes from Canada," he said. "We have a joint venture there for specialty alloys and the cost of those tariffs are then passed on to our customers."

Casimiro Liborio, vice president and general manager of Gerdau Long Steel North America, however, said the tariffs have been beneficial for his facility in Cartersville.

"We've seen this year a good increase from previous years of shipments," he said. "So far, what's happened to us is that we gained market share from imports, basically, with the higher price ... what we need to do is continue to work on efficiency and to make sure we are competitive."

Bob Fair, plant manager at TrinityRail in Cartersville, said he doesn't consider the tariffs that big of a factor on the company's bottom line.

"Locally here, from my perspective, it's a minimal impact," he said. "We continue to source steel domestically, so I'm not seeing it here."

All three managers, however, voiced concerns about shortages in the labor force.

Liborio said there are some positions at Gerdau that have gone unfilled for months.

"We haven't had a lot of issues finding people for our entry level jobs. However, when it goes to the skilled trades, it's a problem," he said. "It's a big problem, actually ... we're not really able to find electricians, for example, and we're an electric steel mill and we've got an electric arc furnace." 

James said skilled labor in the automotive industry is hard to find throughout the nation — and Bartow County is certainly no exception.

"We talk about culture a lot in our facilities, and one of the things we protect the most is entry level positions," he said. "We will bring you in and develop you into who we need you to be. And it also gives people a chance where their last job may have been in a fast food restaurant, or it may have been in retail or it may have been in very light industrial."

That same mentality drives TrinityRail's in-house jobs training approach, Fair said, which is one of the reasons why the company made the decision to develop its own program for welders.

"Typically, we can bring in 17 people at a time," he said. "We can take people who don't have the skills but show potential and run them through our welding school and teach them how to work."

Fair said his company has also partnered with the Bartow County College and Career Academy and the Georgia Trade School in Acworth to develop industrial talent.

Liborio said Gerdau is taking a similar approach, partnering with Chattahoochee Technical College (CTC) for maintenance technician training as well as creating its own apprenticeship program.

"Anything we can do as a community to stimulate technical skills of folks coming out of high school or already trained in some kind of technical, mechanical or electrical skill would help tremendously," he said. "Even programming or coding, that's something we have room for as well."

James said Constellium is likewise investing in apprenticeships and jobs training programs with CTC.

"Training and development is one of the keys for our workforce," he said. "We also received a grant through the state, and some of our partners that have led us into a pathway that some of this training can be done from the outside with external partners to come in and train our people and a lot of that cost is reimbursed by the state."

However, a lack of skilled workers isn't the only deterrent to job growth. All three men agreed that energy costs in the state are another big barrier to business expansion.

"We are competing not only with other countries, but also internally in our company," Liborio said. "Our building in Texas, they have an advantage of almost half of what we pay for electricity here, and this is an issue."

Fair said he has the same concerns regarding the local TrinityRail facility.

"We're in competition ourselves with other facilities across the United States," he said. "And what we try to do is to make up for the energy costs, we try to focus on other areas on our [maintenance, repair and operations] spending."

It's an especially daunting problem for Constellium, James said, considering the energy costs of the local plant are significantly higher than their plant in Michigan — this, despite the Michigan plant being almost four times larger and with three times the amount of equipment.

"We're roughly double what our plant in Michigan pays, and they're a 400,000-square-foot facility and we're 130,000," he said. "We are paying much more in energy costs and trying to justify that in a budget review ... looking at my sales versus their sales, I had to pull every bill that was sent to my general manager and vice president of North America operations just to show this is what we're spending a month currently, and that doesn't even count putting on all of our new equipment that just came in."