Furniture maker brings jobs back to U.S.

Marketplace Staff Aug 18, 2008

Furniture maker brings jobs back to U.S.

Marketplace Staff Aug 18, 2008


Kai Ryssdal: There’s probably not a single part of the American economy that’s had a rougher time this decade than manufacturing. Tens of thousands of jobs have been lost as factory work has been shipped to places like China and Indonesia. But some parts of the macro-economic equation might now be tilting in the other direction. And that has prompted one furniture-maker, Thomasville, to bring some of those jobs — 100 of ’em in all — back to its wood furniture plant in Lenoir, North Carolina. From North Carolina Public Radio, Dave DeWitt reports.

Dave DeWitt: Lenoir is the kind of town where the mayor is also a real estate agent and owns the local Ford dealership. David Barlow knows everything that’s going on in his town, or at least he usually does. Thomasville’s news caught him off guard.

David Barlow: It was a surprise to me at the point that I heard about it. We’ve always had some hope that maybe due to economic factors, maybe there was some possibility that we would get back some furniture jobs. So it was great news.

One hundred new jobs isn’t much in a county that’s lost 6,000 furniture jobs this decade. And the majority of Thomasville’s manufacturing will remain in Asia. But Mayor Barlow says his town will take what it can get. And his hunch was right. Global economic factors are working in Lenoir’s favor, for a change. Ralph Scozzafava is the CEO of Furniture Brands International, which owns Thomasville.

Ralph Scozzafava: You really have this accordion effect — foreign exchange, the weakening dollar, you’ve got increased labor expenses in China as well, so you’ve really got a lot of macro factors that add to your costs.

Scozzafava says his cost of doing business in China has increased 15 percent in the last year. With oil prices so high, the idea of moving manufacturing back to the U.S. looks like a good idea. Analyst Jerry Epperson keeps tabs on the furniture industry, and he’s not so sure.

Jerry Epperson: The problem is that a lot of these companies have shuttered their existing wood furniture plants, and you can’t just come back into that plant and reopen it without reapplying for the permits and the environmental statements and of course, recruiting the labor. You can’t put that genie back in the bottle.

Epperson says the pool of willing, trained furniture workers in the U.S. isn’t what it once was. And in a few years, it might not be there at all. Scozzafava, the CEO of Furniture Brands, admits the shrinking furniture labor force is a concern.

Epperson: The more people are cross-trained and are learning other skills, then the harder it is for you to get the workforce you need to be successful. But I don’t think we’re there yet, thank god. And we’re just gonna work our hardest to make it work, because we think it’s very important.

[traffic noise] A traffic jam in downtown Lenoir is still a rarity, but car and foot traffic is much improved from five years ago. Back then, most of the shops around the town square were boarded up. Now, trendy restaurants and galleries are appearing. Mayor Barlow says Lenoir is trying to re-brand itself as a tourism and technology hub. He says while new furniture jobs are welcome, the industry itself might not have much of a future here.

Barlow: It used to be so many people would drop out of school and go to work in the furniture business. So, a lot of lessons were to be learned, I mean, and hopefully those parents now will know, “I can’t let this happen to my child.”

Mayor Barlow encourages visitors to take a drive south of downtown, along Morganton Boulevard, where Lenoir’s past and future sit opposite each other. On the west side, the Bernhardt Furniture factory, a collection of rusting buildings operating at a fraction of what it once was. And across the road, to the east, a brand-new $600 million data center — built by Google.

In Lenoir, North Carolina, I’m Dave DeWitt for Marketplace.

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