Industrial N Illinois

Workforce shortage is a problem, but Rockford knows how to turn it around

Workforce shortage is a problem, but Rockford knows how to turn it around,ph01

Rockford is known as a manufacturing hub, and one of the largest problems for most communities like this is cultivating a prepared, robust workforce. Rockford's Economic and Development Council is taking that problem head on by developing a workforce and education programs that are integrated with businesses driving the community's economy.

"Last year we added the most jobs in Illinois outside of Chicago which pulled tremendous slack out of unemployment. Right now, we've got one of the lowest housing inventories. That's a good indication for us of how tight the market is getting, so from our perspective things are looking good," Nathan Bryant, president of RAEDC told RE Journals.

A top concern for most industrial companies is workforce. The facility can be state-of-the-art and in a great location, but if the people aren't there then the company won't be either. That's why municipalities work so hard to make sure housing is affordable and available, that downtowns are vibrant and incentives are provided. But Rockford is going one step further, in making sure educational programs are fully integrated with booming industries.

"Our biggest challenge is labor force which is no different than other markets our size. Except, we own our destiny on workforce. We focus on building highly customized workforce strategies specifically to attract and retain business in our community,” Bryant said.

The drivers in this submarket are mostly manufacturing, aerospace, distribution, auto and food industries, according to a report from JLL. Two of the largest new leases in the area, both over 100,000 square feet, were signed by Thyssen Krupp and renewed by Android Industries. Six more leases were signed in 2017, totaling 1,465,000-million-square-feet. Year-to-date net absorption stands at 589,577-square-feet, an impressive gain from the negative 25,647-square-feet recorded in Q2 of 2016.

The largest sale mid-year was the Stag Industrial Management acquisition of a recently delivered 336,000-square-foot manufacturing facility from the Landmark Group in Belvidere. The building traded at a 7.5 percent cap rate at $68 per square foot.

Looking at development, the Yangfeng Automotive Interiors build-to-suit at 775 Logistics Drive in Belvidere was completed in Q2, making it the area's largest delivery in two years. The 336,000-square-foot manufacturing facility will supply interior components for the Jeep Cherokee assembled at the FCA Belvidere Plant. Another build-to-suit, 221,844-square-foot project being developed for Magna Automotive will be delivered later this year.

Auto industry and manufacturing companies were active in Q2, but the aerospace business has been a staple in Rockford's economy.

"Our largest driver is the aerospace business, there are well over 90 companies just in Winnebago alone that are tied to aerospace. The reality is if there's an aircraft in the sky, it's got parts from our region," Bryant said.

That's one reason RAEDC worked hard to attract AAR Corporate, an aircraft repair facility. The repair hub located within the Rockford International Airport brought more than 500 jobs to Rockford. Most of those jobs were filled by graduates from Rock Valley College's aviation maintenance technology program, which is located in a building right next to AAR's hangar at the airport.

"Any time there is a plane that's flying—those need to be serviced. And the key to getting AAR out here wasn't financial incentives, it was a guaranteed labor training facility on airport grounds. It secured 500 mechanics for ARR. We need aerospace engineers like you wouldn't believe," Bryant said.

Rockford makes sure that education is available, affordable and integrated with industries that are expanding. Even Rockford’s high schools have academies that are geared toward exposing students to different professions at a young age.

In the next few years, Bryant said, he’s set his sights on developing a customized workforce solution for registered nurses. That makes sense since SwedishAmerican announced it would expand its healthcare services with the construction of two multi-specialty clinics costing about $35.5 million.

The two clinics, one on North Main Street and the other on Bell School Road, will offer OB/GYN, pediatrics, family practice, internal medicine, endocrinology and lab services. The two projects will add about 500 construction jobs and dozens of new permanent healthcare jobs. The construction will begin in winter and is scheduled to finish by early 2019.

Whether it’s aerospace, healthcare or screws Rockford knows it’s strengths and plays to them. Bryant said they’ll continue to roll out new initiatives this year focused on long-term gains and increasing the workforce. As far as Bryant knows, Rockford is one of the only regions that is tackling this problem with precision and seeing success.

“We're not different from any other place, what separates us from the pack is that regardless of our circumstance we will and have built programs to prepare a workforce better than anyone,” Bryant said.

"We know exactly where we need to be, what we need to supply.”