ST. PAUL (WJON News) - Manufacturers expect to increase wages and benefits and maintain constant productivity in 2023.

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That’s the takeaway from the Manufacturing Business Conditions Survey released by the Minnesota Department of Employment and Economic Development.

Among the key findings in the survey:

  • 73% expect unchanged exports
  • 55% expect the same production levels
  • 51% expect constant productivity
  • 44% expect unchanged employment levels
  • 41% expect the same profit levels
  • In addition, wages and benefits are expected to increase.
  • 60% of respondents expect wages to grow between 3-5%
  • 40% of respondents expect a rise in benefits.
Photo: Louis Industries
Photo: Louis Industries

President and CEO of Paynesville Minnesota-based Louis Manufacturing, Lance Louis, says he sees a combination of problems and growth in his business. To start, he says the COVID pandemic has changed the way people expect supply lines to function.

Amazon has educated the entire country that you can go online, order something, (and) in some cases, get it within two hours. In the past number of years, supply chains have taken that same approach. I think the realization has come that everybody has to work together to make sure that the supply chain continues to flow.

As for employment, Louis says there are several long-term employees that are getting ready to retire, and the resulting knowledge gap creates its own unique set of problems.

I would say this is probably one of the long-term challenges that we're going to continue to face. There's a huge group of people in our industry that have been around for years that are just retiring. That knowledge is leaving and replacing that knowledge is tough. There are not as many people out there to hire, and, in a lot of cases, you've got to go through this training aspect. We're all competing for the same people. Instead of competing maybe on price or competing on service, we're competing against each other for labor which is kind of unique.

Louis says 2023 will be challenging, as companies move from a build-to-order system to a build-to-stock. As dealers start to rebuild inventory after the COVID pandemic, questions remain on what type of supply is the most efficient. Lewis also claims that “onshoring”, or businesses moving operations back to the United States, is creating new customers and growth in his business.

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