Manufacturing resurgence spurs growth, says CEO
With more than $200 million under contract and a revival in stateside chemical manufacturing operations, an Upstate industrial engineering and construction company is looking to expand.
O’Neal Inc. added over 125 new jobs last year and is expecting to add more in 2014 to remain ahead of the demand.
“We plan to aggressively grow our process engineering and process construction groups,” said Kevin Bean, president and CEO.
The company’s expansion will include approximately 25 construction professionals and 20 to 40 engineers needed for future contracts, he said. O’Neal intends to fill the positions organically or by specifically targeting firms that fit their mark.
Bean said the resurgence in American production will lead to future manufacturing facilities.
The projected need for new plants is spurring O’Neal’s growth demands, he said. The company anticipates heavy manufacturing of automotive components and an uptick in both plastics and the pulp and paper industry.
Bean credited the lowered price of shale gas for the renewal of indigenous manufacturing.
Natural gas is a key component to what is used to produce plastics, and with its lowered cost, raw materials can be produced cheaper than 15 years ago, he said.
The reduced cost of natural gas in the United States is due to the advances in extraction technologies such as drilling techniques and the ability to access new and deeper reserves, said Brian Gallagher, O’Neal’s director of marketing.
Manufacturing is important to the U.S. and to South Carolina because of the job creation opportunities and the capital investment it represents, he said. In South Carolina, when there is a manufacturing investment, there are typically other companies that benefit, such as firms that are building the manufacturing plants and the suppliers of its materials
Gallagher said this is referred to as the “BMW effect” in South Carolina.
The capital investment of BMW attracted other manufacturers and suppliers to relocate here, he said.
In addition to the lowered cost of natural gas providing a stimulant to homegrown manufacturing, Bean said companies in the private sector were sitting on their cash reserves during the recession waiting for it to end.
With shale’s impact on manufacturing and available cash ready to be invested, shelved projects are now being put into play, he said.
The Upstate will benefit from the return of manufacturing because of the high quality and high-paying jobs that come with it, Bean said.
“We are going to be bringing professionals to the area that will participate in the economy,” he said. “If we achieve our hiring goals for this year, it will represent a $5 million investment in salaries when you include benefits, support, computers and software.”
A study conducted by the National Association of Manufacturers revealed every dollar invested into American manufacturing yielded $1.45 return to its economy, creating a ripple effect benefitting infrastructure and logistics.
According to the study, manufacturing in the U.S. produces $1.8 trillion of value each year, while the average manufacturing worker earns $77,060 annually compared to the average worker in all industries earning just $60,168.