By DAVE SIMANOFF The Tampa Tribune

Published: Jan 23, 2007

Mike Stima is in a bind.

As the production manager for the Tampa Armature Works' custom equipment factory in Riverview, he oversees a staff of about 90. They manufacture heavy-duty electrical equipment, including mobile power distribution centers the size of small houses, for customers such as utility companies and the military.

Stima said he needs more workers, not just to handle the workload at TAW but to beef up its capacity as the company prepares to expand. But he can't find the workers. And he can't turn down assignments or delay any jobs.

"If we can't service our customers, in some cases it jeopardizes soldiers' lives and people's lives," he said.

Last year, it took the company six months to hire four welders. Today, Stima said, he needs to hire five additional welders and 10 electrical assemblers.

TAW, like many growingcompanies in the Tampa Bay area, is experiencing one of the unfortunate byproducts of the region's persistently high employment rate.

With unemployment hovering at 3 percent in the region, there simply aren't many people looking for jobs. As a manufacturing company, TAW's labor woes are exacerbated because the region isn't producing many new workers with the skills and training for industrial jobs.

The unemployment rate in the Tampa Bay area began plummeting at the end of 2003. For the past year, it has been close to 3 percent, and experts don't expect the rate to rise soon.

Low unemployment rates generally are seen as good for the economy - people with jobs, after all, tend to buy consumer goods and big-ticket items such as cars and houses.

"Obviously, lower employment numbers are a good thing - it's a sign of a strong economy, a robust economy," said Chris Smith, vice president for public policy at the Greater Tampa Chamber of Commerce.

"If you've got such low unemployment rates, it means people are working," he said.

However, when unemployment rates remain low for long periods, companies can face problems when they try to expand and hire new workers.

Right now, "we're at full employment, relative to skilled labor," said Tony Villamil, chief executive officer and principal economist for the Washington Economics Group in Coral Gables .

Competition for skilled labor could push up wages.

That would be good for workers and could spur more consumer spending, but it would mean additional costs for employers who already are coping with rising prices for insurance and health care, Villamil said.

"We have a skill shortage in Florida , and that's driving up the cost of doing business," he said.

Automation Is An Option

As it becomes more difficult for employers to find skilled workers, and as the cost to hire those workers increases, "it pushes employers to automate and use electronic equipment as much as they can, as opposed to human resources," Villamil said.

Back at TAW, there's a growing recognition that there aren't any short-term solutions to the company's labor problems. Raising wages won't produce additional skilled workers, Stima said.

"It's a supply problem," he said.

Stephanie Koch, TAW's human resources manager, said her company is approaching its labor shortage in two ways.

First, it's beefing up its human resources staff and more actively searching for applicants nationwide. Second, it's investing in training and education efforts inside the company and in the local community.

Koch said she's worried that students in high school aren't learning enough about opportunities in manufacturing.

"As a whole, manufacturing provides a critical need - in not only the state of Florida but the whole United States ," she said. "There's good money that's being paid."

Koch said she could not disclose company wages for competition reasons.

Waiting Isn't An Option

Finding skilled workers is critical for the company, Koch said. TAW employs 640 people at 15 plants in three states, and it's looking to grow to more than 1,000 employees in the next five years.

As a result, company officials can't just sit back and wait for applications.

Koch said TAW began its own apprenticeship program a year ago and is becoming more involved in local and regional work force development efforts.

"It's not going to be quick enough, but over the next three to five years, we expect to see some results from it," she said.