The Economist analyzed how employers are adjusting to a labor market with only seven workers for every ten available jobs. Tactics include sign-on bonuses, higher base pay, in-house training, more predictable schedules, and investments in automation.
From “How America’s talent wars are reshaping business” (The Economist):
The share of job postings that list “no experience required” more than doubled from January 2020 to September 2021, according to Burning Glass, an analytics firm. Easing rigid criteria may be sensible, even without a labour shortage.
Another way to deal with a shortage of qualified staff is for the companies to impart the qualifications themselves. In September, the most recent month for which Burning Glass has data, the share of job postings that offer training was more than 30% higher than in January 2020.
Besides revamping recruitment and training, companies are modifying how their workers work. Some positions are objectively bad, with low pay, unpredictable scheduling and little opportunity for growth. Zeynep Ton of the MIT Sloan School of Management contends that making low-wage jobs more appealing improves retention and productivity, which supports profits in the long term. As interesting as Walmart’s pay increases, she argues, are the retail behemoth’s management changes. Last year it said that two-thirds of the more than 565,000 hourly workers in its stores would work full time, up from about half in 2016. They would have predictable schedules week to week and more structured mentorship.
As a last resort, companies that cannot find enough workers are trying to do with fewer of them. […] Increasingly, it also involves investments in automation. Orders of robots in the third quarter surpassed their prepandemic high, by both volume and value, according to the Association for Advancing Automation.https://www.economist.com/business/2022/01/30/how-americas-talent-wars-are-reshaping-business
From PP, PE prices take a fall in December (Plastics News):
Average selling prices for PE slid 5 cents per pound in December, while PP prices tumbled 15 cents, according to buyers and sellers contacted by Plastics News. It’s the third consecutive 5-cent drop seen in the PE market. The October drop was the first seen in 17 months, as prices had jumped starting in early 2020 when pandemic-related demand couldn’t be met because of weather-related production outages.
Mike Burns, a PE market analyst with Resin Technology Inc. in Fort Worth, Texas, said that “warehouses are full [of PE], and exports can’t get out because of a lack of containers or other supply chain problems.”
Although PE prices dropped 15 cents in late 2021, the market finished the year up a net of 28 cents, according to the PN resin pricing chart.
Even with the late-year declines, PP prices are up a net of 39.5 cents since December 2020. North American PP supplies will be boosted in 2022 when Inter Pipeline Ltd.’s Heartland Petrochemical Complex brings more than 1 billion pounds of new capacity online in Strathcona County, Alberta.
Bloomberg writes this week about the hidden cause of the cream cheese shortage: their supply chain was disrupted by a ransomware attack.
Schreiber Foods in Wisconsin, a top maker of cream cheese, closed for days in October after hackers compromised plants and distribution centers. The company is big enough that the lost production shook U.S. markets.https://www.bloomberg.com/news/newsletters/2021-12-10/supply-chain-latest-cream-cheese-is-the-latest-casualty-of-cyberattacks?cmpid=BBD121021_TRADE&utm_medium=email&utm_source=newsletter&utm_term=211210&utm_campaign=trade
How are companies addressing the growing threat of cyber attacks? The Economist writes in their issue about The World Ahead 2022:
More than a third of senior executives surveyed in March 2021 by Munich Re, a reinsurer, are considering taking out a cyber-insurance policy, which pays out for ransomware-related losses.
Curbing cyber-crime ultimately requires getting the basics right: educating employees to be wary of suspicious emails; keeping software up to date; and backing up data.https://www.economist.com/the-world-ahead/2021/11/08/the-digital-pandemic-of-ransomware-attacks-will-continue
Many insurance brokers that sell cyber attack insurance policies also include free online training to reduce the risk of becoming a victim.
The Economist writes that there is reason to believe higher rates of turnover are here to stay. Their columnist writes generally about the three things managers should be doing: gauge the retention risk, pull different levels to retain different types of people, and plan for how to find new workers.
First, they should systematically gauge the retention risk that their firm faces. Working out what has driven people to quit is too late; rather than exit interviews, forward-thinking firms conduct “stay interviews” to find out what keeps employees. Focusing on teams cut back during the pandemic is another tactic: burnout rates are likely to be higher in departments that took lay-offs. Understanding a firm’s vulnerability to other employers is also key. When behemoths like Amazon or Walmart raise wages or add perks, the effects ripple beyond retailing.
Second, managers need to pull different levers to retain different types of people. Salaries matter to everyone but for lower-wage workers in particular, benefits like health care have also become central. A recent survey of young Americans by Jefferies, an investment bank, found that health concerns were the prime reason why people with only a high-school education had quit their jobs.
Firms also need to think harder about the career paths that entry-level employees can take. In a recent survey of large firms conducted by the Institute for Corporate Productivity, a research outfit, a majority admitted they did not have adequate data about the skills of their workers, making it harder to spot talent. A quarter reckoned that LinkedIn knew more about their workforce’s capabilities than their own firms did.
Third, managers should plan for how to find new workers. Remote working makes it easier to lose people but also to bring freelancers on board quickly. Qualification demands can be relaxed. In recent years IBM has removed the requirement for undergraduate degrees from over half of its American job openings. And there is no better time for firms to take aim at dim-witted regulation. In response to a shortage of lorry drivers, Britain’s government has decided to combine separate tests for driving rigid and articulated lorries into one.How to manage the Great Resignation, https://econ.st/3xP1ym9
From “Lower prices ahead for PE, PP resins as supplies improve” (Plastics News):
After more than a year of increases, prices for polyethylene and polypropylene resins are expected to trend downward. Market analysts Nick Vafiadis and Joel Morales of IHS Markit gave their outlooks for PE and PP markets Oct. 27 as part of the online Global Plastics Summit 2021.”
Vafiadis said that COVID-19 and “epic weather events” have constrained production of PE resin and delayed new capacity from coming on. Those conditions have led to higher prices since early 2020, but the market “now appears poised for a correction,” he added.
[…] In North America, about 9 billion pounds in PE capacity expansions are expected in the near future. Most recently, Gulf Coast Capital Ventures — a joint venture between ExxonMobil and Sabic — added almost 3 billion pounds of capacity in Corpus Christi, Texas.
Global PE operating rates are expected to range from the low to high 80s in the near term. Global oversupply was expected to be around 24 billion pounds before the pandemic, but now is projected to be less than 14 billion pounds.
The net result of these moves is expected to be lower PE resin prices. “Prices have peaked and are ready to decline because of new capacity and the resolution of storm outages,” Vafiadis said. “They’ll be mitigated somewhat by higher energy prices, but [PE] prices are at or near cyclical peaks in all regions.”
From “Plastics bring solutions in auto lighting, exteriors for autonomous cars”:
The automotive industry needs new concepts to meet optical and physical requirements for exterior parts, as signaling and communication become important aspects for a move toward automated driving.
Auto suppliers Marelli and Samvardhana Motherson Automotive Systems Group have formed a new partnership to integrate sensors for advanced driver-assistance systems and autonomous driving in illuminated exterior body parts like front grilles, bumpers and others.
The partnership plans to create translucent, back-lit trim parts and other decorative panels, with LED lighting shining through them at night and taking on the color of the car body in daylight, both partners told Plastics News in a joint statement.
“Parts like front or rear ends, fenders and rocker panels will evolve into smart illuminated body panels that will give vehicles an even stronger brand signature,” the joint statement said. “Smart illumination opens new possibilities for OEMs to support diversification of brands and models, also with possible different day and night styles.
While the companies work together to develop parts like bumper fascias, which aren’t commonly translucent, out of optical materials, they will also have to meet safety requirements and integrate sensors, like LiDARs, radars and cameras, as autonomous driving systems become required features.
“It is becoming more and more important for the authorities to set rules on how to make fully automated cars recognizable,” the statement said. “Future illuminated parts offer new openings for this purpose and can be used for communication as well.”
Bloomberg columnist and professor of economics at George Mason University on the supply chain breakdown:
…some key nerve centers of the world economy have been hit by a mix of Covid and bad luck, especially in the latter part of this year. Transportation, energy and high-quality semiconductor chips all are experiencing big problems at the same time, for reasons which are distinct yet broadly related.
Start with transportation. While some Chinese ports have been dormant or operating at reduced capacity because of Covid, that is hardly the only issue. A robust trade in durable goods has placed great strain on containers, ships and port operations around the world. The price of containers has skyrocketed, and can be more than 10 times higher than it was just two years ago. In short, a lot of international trade has slowed considerably, plus some of it no longer is profitable.
In some cases, transport-related services are being rationed, as prices are being kept down — maybe to avoid alienating loyal buyers, or maybe because the sellers are not sure if the current demand shocks are permanent. Again, the net result is that a lot of trade simply isn’t happening in a timely manner. […]
Furthermore, a lot of port activity and related local transportation is labor-intensive. Many parts of the world are facing labor shortages, as people are not sure how to reconfigure their post-Covid work futures, or in some cases government benefits may be keeping them from working. That adds further delays to trade networks. […]
So on one side of the equation are trade delays, input delays, higher trade and transport costs, much higher energy prices and chip shortages. On the other side are American and European consumers, who saved enormous amounts of money during 2020 and early 2021 and are now spending it. This combination has fueled price inflation. The demand is hitting the market, and the supply can’t catch up. And it’s not just one problem that has an easy, direct fix, but rather a series of interlocking paths of economic chaos and delay.https://www.bloomberg.com/opinion/articles/2021-10-11/supply-chain-disruptions-almost-too-many-reasons-to-count
From “Resin markets may feel wrath of Ida while recovering from past weather blasts” (Plastics News):
The Gulf Coast of Louisiana is home to many plants making plastic resins, as well as feedstocks needed to make those materials. Most of those plants began to close Aug. 28 in advance of the storm. As of mid-day Aug. 30, no major damage had been reported from any plastics or petrochemicals plants in the region.
But no firms had released a timetable for a potential restart. Electrical power remains out throughout the region, with almost 1 million people without power. Many roads and rail lines also can’t be used because of high water levels. […]
The Resin Technology Inc. consulting firm in Fort Worth, Texas, estimated that 10.3 billion pounds of annual PE production has been shut down. That production is operated by Dow Inc. in Taft and Plaquemine and by ExxonMobil Chemical in Baton Rouge.
RTI also estimated that 7.4 billion pounds of annual PVC resin production operated by Shintech Inc. in Plaquemine and Addis, Formosa Plastics Corp. USA in Baton Rouge and Westlake Chemical Corp. in Plaquemine and Geismar also are shut down.
The region also is home to several polystyrene production sites, as well as sites making elastomers, polyurethane feedstocks and other materials. Refineries that make propylene monomer as a byproduct of gasoline production also are in the area. Some of that propylene then is used to make polypropylene resin.
As a result, resin prices that buyers had hoped to see leveling out after 18 months of steady increases could be heading up again — an unwelcome event for plastics processors throughout North America.https://www.plasticsnews.com/news/resin-markets-may-feel-wrath-ida-while-recovering-past-weather-blasts
From Consolidation has the biggest impact on rotomolding sector (Plastics News):
With combined sales of more than $2.6 billion for fiscal 2020, 107 firms made the ranking this year. That’s up 3.5 percent vs. 2019. The average sales per company was $23.9 million, that’s up 10 percent.
Proprietary molding makes up the biggest share among the molder, with $1.5 billion, or 60 percent of the total. Custom and captive come in at $605 million and $128 million, respectively.
You may have noticed that we have fewer firms ranked this year and we can look to consolidation for the reason. Tank Holding Corp., which tops our list with estimated $420 million in related sales, includes four acquired companies from our previous list: Dura-Cast Products Inc.; Rotational Molding Inc.; Rotational Molding of Utah and Spin Products Inc.
Myers Industries Inc., enters our list this year at No. 4, with $164.3 million, combining previously listed Ameri-Kart Corp. plus recently acquired Elkhart Plastics Inc. and Trilogy Plastics Inc.