Made In America: The Slowdown In Santa’s Supply Chain

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WEST COAST PORT PROBLEMS SLOWING SANTA’S SUPPLY CHAIN
Several reports this week focused on the showdown between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILWU). It basically centers around an unresolved contract dispute pitting port operators versus the 20,000 union workers who load and unload ships for manufactured goods to be exported overseas and imported into the U.S. According to multiple reports, the major hangup is over costs associated with rising health care costs – a potential $190 million tab that no one wants to absorb.

The ports in Los Angeles and Long Beach, California handle about 40% of key import shipping business. A round of pro-business interest groups weighed in on the PMA’s side this week, including The National Retail Federation, the National Association of Manufacturers and the U.S. Chamber of Commerce.

The dockworkers union (ILWU) said it has been made “a scapegoat” in the port problems. Two representatives of the union said their members want a contract to resolve labor and pay issues, and they contend that terminal operators should be blamed for the economic woes. ILWU leaders said this week that marine terminals have been “arbitrarily sending work crews home.” Port operators are complaining that the unions are using “work to rule” methods, a tactic that involves following written company guidelines as literally as possible to avoid shortcuts or practices that aren’t fully spelled out in rulebooks or procedures. Read more here.

AN ARKANSAS MANUFACTURING PEEK
New metro area employment statistics offer insight on some recent trends in parts of Arkansas’ manufacturing sector. In context, the numbers also highlight the decade-long decline in those middle-class jobs.

According to Bureau of Labor Statistics’ numbers released last week as part of the metro area unemployment report, Fort Smith – an important hub in the state’s manufacturing arena – showed manufacturing employment at an estimated 17,800 in October, down from 17,900 in September, and below the 18,400 in October 2013. Sector employment is down 37.5% from a decade ago when October 2004 manufacturing employment in the Fort Smith metro area stood at 28,500. Annual average monthly employment in manufacturing has fallen from 28,900 in 2005, 19,200 in 2012, and to 18,300 in 2013.

The Northwest Arkansas manufacturing sector employed an estimated 26,200 in October, up from 26,100 in September, but down from the 26,400 during October 2013. Sector employment is down more than 21% from more than a decade ago when October 2004 manufacturing employment in the metro area stood at 33,300.

CLEAN POWER PLAN COMMENTS TOP 1.6 MILLION
More than 1.6 million people and interests weighed in during the comment period on the Environmental Protection Agency (EPA) proposed rules regarding President Obama’s Clean Power Plan. The regulation addresses how greenhouse gas emissions will be controlled at future power plants and it proposes a 30% reduction in carbon dioxide emissions from existing power plants by 2030 from 2005 levels.

The comment period ended Dec. 1 and a press secretary for the EPA said the agency is now working to review the comments as it tries to finalize the proposed rule, but offered no expected date. The memorandum by President Obama gives the EPA until June 1, 2015 to submit final standards.

Janet McCabe, EPA assistant administrator for the office of air and radiation, said on her blog, “But for now, as the formal public comment period comes to a close, I want everyone to know how grateful we are to those of you who have taken the time to review the proposal and to tell us what you think. And while we’ve said countless times that the agency’s outreach has been unprecedented—the reaction and the level of stakeholder engagement have been equally unprecedented. This is exactly the way the process should work.”

Some groups in Arkansas helped organize comments that led to tens of thousands weighing in with an opinion. No word on the percentage of how many of the 1.6 million-plus comments were supportive or advocated a change in the President’s policy. The Arkansas Department of Environmental Quality said last week that a group of stakeholders discussing the state’s potential plan for the EPA rule would not likely reconvene on the matter until after the June 1 final standards deadline.

BASS PRO SET TO ACQUIRE RANGER BOATS
Bass Pro Group announced Thursday (Dec. 11) it has an agreement to acquire Fishing Holdings, LLC. That company makes Ranger boats, among other brands. The business is headquartered in Flippin, Arkansas. Ranger manufactures more than 40 models of bass, saltwater, aluminum and other boats. Terms of the deal were not disclosed. Read more here.