The Donald has taken the American political landscape by storm. Although I am not sure what to make of Donald Trump yet, he has brought attention to an issue that should be of top concern to the pallet and low-grade lumber industries. Trump has put a spotlight on the illegal immigration issue and has vowed to crack down on illegals coming across the border. If Trump got his wish, it could put a significant hurting on a key source of labor for our industry.
Immigrant labor continues to make up a large part of the pallet industry, especially the recycling sector. While many of these workers are legal, a percentage of them is not, and had it not been for the influx of mostly Hispanic workers in some parts of the country the pallet industry would have had an even tougher time than it has had finding qualified workers.
The pallet and lumber industries are hard work, and many Americans just don’t want to work physically that hard even if they get pretty decent money for the job.
Our most recent human resources survey was conducted in 2013. It found that the ethnic makeup of production workforce in the pallet industry has changed since the survey was first conducted in 2001. Back then, Caucasians made up 65.3% of the workers compared to 24.8% for Hispanics and 8.6% for Blacks and Others (mostly Amish or Asian) came in at 1.3%. More recently, Hispanics make up 35.6% or more while the other ethnic groups have all dropped even though Caucasians still remain the largest ethnic group.
This not only reflects changes in the ethnic makeup of the country. It also reflects the available workers in the labor pool. Many of the Hispanic workers are legally allowed to work here although a large percentage may not be even though they may have valid papers.
All of this points to the changing labor landscape in the country and the need for pallet and lumber companies to develop a strategy to deal with the problem. While the next president may not be able to change the border policies too much and Congress seems at a standstill on the issue, political winds can change pretty quickly.
Even if you take the border issue off the table, workers are getting more and more expensive thanks to regulations and obligations, such as Obamacare.
The first thing you can do is evaluate your operation to look for areas where you can improve processes and reduce labor needs. This may involve buying a new piece of equipment or changing a current practice that makes your workers more efficient.
This issue features a number of companies that have improved their labor issues by making changes in everything from their nail guns and tool programs to adding one or two pieces of equipment.
The cover story explains how Viper Industrial Products worked with L&R Pallet to fix nailing issues the company was having that affected productivity. If your nail guns don’t work right and this leads to idle time, you are adding to your labor woes. This is connected to that in a pallet shop.
Viper helped C.W. Price of Missouri by installing a Woodpecker Jr. nailing machine that allows one worker to produce almost what four experienced pallet builders used to do by hand.
J.C. Pallet found that by adding a notcher from Smart Products it was able to turn wood scraps and boards into usable lumber for producing pallets or even selling lots to hobbyists.
If you like interesting human interest stories, check out how Jared Lowelll went from being a pro hockey player in Europe to a Midwest pallet recycler. He recently helped build a retail stand out of pallets and wood scraps for a Grateful Dead concert held recently in the Chicago area.
Working to find good talent should be part of your strategy, but automation can solve a lot of issues by allowing you to reduce your reliance on personnel or make it easier for newbies to produce a decent amount of work without needing 5-10 years of experience. Automation makes it easier to plan your production schedule and know you can deliver the job on time. The more you are reliant on people the more variables you are throwing into your business mix.
The pallet industry has always been a people business. And it is going to stay that way for a long time. You just want to make sure that you are positioned to grow and handle what comes your way.
If your operation does a lot by hand, good for you. But finding ways to reduce labor requirements must be something you keep an eye on. The workers you can afford and find today, may be difficult to retain or pay in the future.
As far as the guy with the wild hair who wants to be president and likes to fire people, he has ignited a debate about border policy and illegal immigration that the pallet industry must watch closely and be ready for whatever could come politically after the election in 2016.
