Looking back over the 30 years that I ran a company that did
precision machining of parts, technology changed the way we did business in
fundamental way. In the 1970’s,
companies like mine had skilled machinists running manual machine tools. These employees were hired into apprentice
programs and over a period of about three years would advance to a journeyman
machinist status. The advent of
computer numeric controlled machine tools changed all that. The new machines were programmed to adjust
spindle speeds, automatically change tools, and guide the cutting tools to
shape the parts in an enclosed machine.
What was required then was a highly skilled setup man who could set and
calibrate the tools and program the machine tool to run the part. We no longer needed a skilled machinist to
actually run the machine since all an operator had to do is load a part into
the machine, close the door and press the cycle start button. Our shop floors evolved into machine
clusters or cells where one operator would run up to three machine tools. We
would have a setup specialist to rotate around to set up the lathes and another
setup specialist to setup the milling machines.
The structure of our workforce then
was two key employees who we paid the absolute top wages to ensure that they
would stay with the company through thick and thin. We had perhaps 12 to 15 machine operators that would run the
machines in the cells but their skill set was such that we could train a new
hire with a some mechanical ability to run machines in a matter of hours. They
essentially had to load parts into the machines then unload the finished
parts. They would have to measure a few
key dimensions on the parts and be able to make tooling offsets to compensate
for tool wear. The implication of this structure on current trends in
employment in the metal working industry should be obvious. A small company can keep a small group of
key people and cut employment back to the bone when hard times come. Our
machine tools cost anywhere between $100,000 and $300,000 apiece and represent
a significant investment on the part of a small businessman. When a recession
hits and work dries up, the successful business owner will not buy new machine
tools and he will lay off machine operators who are much easier to replace than
his skilled setup men. When faced with uncertainties about employment costs
such as health care cost increases or
increased unemployment taxes to cover the massive pool of prolonged
unemployed workers, the small business
owner can literally go to the mattresses. It is not uncommon for a company whose
business is radically reduced to have office personnel run
machines part time and even the owner will take
a turn if it is required to have the business
survive. I know because as the owner, I have made it a
point to be able to setup, program and run any machine
tool I had in my shop.
Against
this backdrop, what is the role of government in creating jobs? I have always
maintained that the only role of government at any level is to create conditions
that allow the private sector to create jobs. We hear constantly about government job training programs but no
matter how many of these programs the government tries to establish, they miss
the mark. I served as President of the
local chapter of the National Tooling and Machining Association in Northwest
Pennsylvania and one of my initiatives that I undertook with other business
owners in our chapter was to create a teaching factory called the Precision
Machining Institute. We convinced
machine tool manufacturers to provide us with state of the art machine tools to
have on our floor to train our much sought after setup and programmer specialists
on the most advanced technologies available.
We also made those machine tools available to the local shop owners to
run jobs that they could not tackle on their machine tools they currently had
on their shop floors. In that way, shop
owners could try out a machine tool by renting machine time at an hourly rate
to develop a new customer or a new capability for the their operation. The point is that this is a model that works,
was developed by private industry and has served as a model for other such
installations across the country. I would like the opportunity as your state
representative to create training facilities like this in New Hampshire.
In a nutshell,
government can create the proper conditions for economic expansion by
cutting taxes, allowing accelerated depreciation on expensive machinery
utilized in the business or better yet allow the equipment to be expensed in
the year it is purchased. The government should eliminate the minimum wage,
quit meddling in health care and forget about government job training
programs. Government must establish
reasonable tax policy and make it simple for companies to comply with and make
it permanent. Uncertainty is killing
the economy now with temporary extensions of current tax rates, the
questionable status of Obamacare, and the threat of massive tax increases on
the so called rich who for the most part are small business owners that file
their taxes as LLC corporations and hence flow their business income into their
personal tax returns. There is no way a
small business like I had would buy a machine tool or hire anyone in this
climate of uncertainty.
