Manufacturing remains a big industry in Los Angeles County, even with a decline in employment over the past four years.
And that decline is impacting the trade associations and groups that represent the industry.
David Goodreau, who has been involved with area manufacturing trade groups for more than 30 years, said that, of the three groups he has represented, the Small Manufacturers Institute is the only one still alive.
He merged the affiliated Small Manufacturers Association into the surviving California Metals Coalition in January 2020 and will likely close down the San Fernando Valley chapter of the National Tooling and Machining Association this year, as that organization only has about six member companies.
“There is no one left to represent the industry, certainly not local,” Goodreau said.
According to data from the Employment Development Department, there were 320,200 manufacturing jobs in Los Angeles County through June.
That is a decrease from the 323,100 manufacturing jobs in the county in June of last year.
Pre-Covid, there were 342,600 manufacturing jobs in the county in June 2019. That’s a drop of 6.4% over the four years.
Covid effect
To some, the pandemic illustrated the importance of such groups.
James Simonelli, executive director of the California Metals Coalition in El Dorado Hills, said that it was a crisis that helped the coalition and showed the value of what a trade organization could bring.
“We actually saw an increased need for a trade association through the whole Covid quarantine time,” Simonelli said.
He said that people gravitated toward groups like the coalition because of the information they could provide.
“At least from 2020 through 2022 we found that people really needed the trade associations for good information, to share good ideas for how to care for employees, for how to best keep the workplace healthy,” Simonelli said.
Donald McKinzie is the co-chair of the South Bay/Los Angeles County chapter of the Society of Manufacturing Engineers. It is only one of three chapters serving the entire state; the others in Orange County and Silicon Valley.
The society, based in Southfield, Michigan, used to be supported by the big aerospace prime manufacturers, but is no longer.
“I don’t know if there is the support for it anymore, and I think it is important to have that support,” said McKinzie, the former head of mechanical manufacturing and engineering at Northrop Grumman Corp. in Redondo Beach.
Ultimately, he said, the major manufacturers in Southern California will need to step up and help out groups like the one he belongs to.
“I don’t care if it’s Boeing Co. or Lockheed Martin Corp. or who it is, you need a supply chain to help support, and if we don’t all work together to try to develop a process to ready people and prepare them for what the workforce needs, trying to bring manufacturing back to the United States is going to struggle,” McKinzie said.
When he was searching for a trade group with which to merge the Small Manufacturers Association, Goodreau said he looked at the California Manufacturers & Technology Association, in Sacramento, along with the California Metals Coalition.
The California Manufacturers & Technology Association was willing to give a free membership to the Small Manufacturers Association members just to boost their own numbers, Goodreau said.
“They are having such trouble connecting with people and getting new members that they were willing to do it for free for our members,” he added. “I decided not to go in that direction.”
The coalition specializes in air and water issues and some human resources, which Goodreau said is where a lot of companies have problems.
Take, for instance, the regulations put into place last year by the California Air Resources Board that will ban the sale of all forklifts powered by internal combustion engines by 2026.
People don’t realize how hard that will be on small business, he said.
“I remember at the last company I started, we had to beg, borrow or steal to get us even a 40-year-old forklift to help us. We didn’t have the money for it,” Goodreau added. “An electric forklift is going to cost a small company $30,000. How are they going to afford that? But that is the type of intervention that (the coalition) does.”
The coalition has about 350 companies in the state.
The coalition’s Simonelli said that the Small Manufacturers Association had quite a number of metal companies as members, so it made a good fit for the two groups to combine.
“It made a lot of sense for him to merge with us because we had the size and the ability to handle his needs,” he said.
Other view
Lance Hastings, the chief executive of the California Manufacturers & Technology Association, however, said that he has not seen any decrease in trade associations.
“Even though we have headwinds here in California with greater regulations and cost of doing business, I have not seen any retraction whatsoever as it relates to the trade groups,” Hastings said.
In fact, in his opinion, the opposite is taking place.
“We work closely with the Los Angeles County Business Federation, the Manufacturers’ Council of the Inland Empire and the Industrial Environmental Association down in San Diego, and everybody appears to be thriving from a membership standpoint,” he added.
As for the industry, everyone in it is still trying to figure out how to keep California as the number one manufacturing state – both in jobs and the number of companies.
According to Hastings, there are about 1.3 million jobs at 30,000 different businesses statewide in manufacturing as of early August, with those numbers holding steady the past few years.
He said a struggle is making sure the environment – locally, regionally and statewide – is conducive to attracting and retaining manufacturers.
“That has been the age-old challenge the (association) has faced, because when I meet with my counterparts from around the country they are doing great because the realignment of jobs is happening in the heartland, and in the southeast,” Hastings said. “But in California we are still emerging from that economic downturn caused by Covid.”
But with the state’s port system in Los Angeles, Long Beach and Oakland, it is well positioned to take advantage of employment gains even if they are not happening at this moment, he continued.
“I think in the next half year to full fiscal year you are going to see some changes in California for the good,” Hastings said.
Shrinking group
Kaity Van Amersfort, executive director of the Los Angeles chapter of the National Tooling and Machining Association, said that the organization has shrunk over the years. In the early 2000s, the chapter had about 250 members.
Today it has around 100.
But that doesn’t mean the industry as a whole is doing poorly, she said.
“Some companies do better than other companies so that might vary a little bit, but I would say as far as manufacturing actually goes, it’s pretty strong,” Van Amersfort added. “You talk to manufacturers, business conditions are not terrible.”
Van Amersfort relies on other members to grow the group.
“I really look at membership as a peer-to-peer sell,” she added.
One member has brought in five new members this year alone, she continued. He did this by inviting then to participate in the events the chapter puts on and by having them tour his shop.
“It is a very generous industry,” Van Amersfort said of manufacturing in Southern California. “While there is certainly competition, I would also say they are friendly competitors.”
When a company has a big backlog and cannot get an order out for a customer, they will contact her and ask that she send out an email to see if there is anybody else who can take the work on, she said.
“There is definitely a camaraderie amongst this group and learning from one another, sharing best practices, sharing ideas,” Van Amersfort added.
But to Goodreau, the former business owner and president of the Small Manufacturers Institute, that sharing doesn’t necessarily mean that all issues facing the industry are being discussed.
Take what he considers to be “a real national security problem,” namely the lack of volume of companies to handle the supply problems of the military.
“Because our military doesn’t have the repair parts to keep our weapons flying and our bullets made, and it is a real problem,” Goodreau said.
“You just don’t hear anybody talking about it. There is a decline going on that is really silent but deadly. I think it is deadly,” he added
