The smell of coolant hits you as you walk through the door.
In machine after machine at Plethora in Marietta, high-powered sprays shower drills as they pierce, slit and cleave through various kinds of metal, aluminum and resin to make component parts.
U.S. trade tensions with China and other countries have hurt factories that make goods for export, but Plethora is growing.
“For us, it’s been great because many people want to bring back factories and produce parts locally,” said Jim Quinn, the chief executive.
That kind of success is just a shadow of manufacturing’s past, when big plants dotted Georgia, before increased automation and competition from lower-wage countries. And in a troubling sign, the Institute for Supply Management’s manufacturing index – based on a survey of U.S. companies – has fallen five consecutive months to its lowest point in more than a decade.
When it comes to jobs, however, the sector is rebounding modestly amid an extended economic expansion that has sent the unemployment rate to multi-decade lows nationally and in Georgia. The growth that started in 2010 has picked up under President Donald Trump, who won election partly by promising the return of good-paying factory jobs.
Between the end of the Great Recession in 2009 and Trump’s January 2017 inauguration, manufacturing added 915,000 jobs nationally — an average of 11,024 a month.
Between the end of the Great Recession in 2009 and Trump’s January 2017 inauguration, manufacturing added 915,000 jobs nationally — an average of 11,024 a month. Last month, manufacturing shed 12,000 jobs, but since Trump took office, manufacturing has grown by 487,000 jobs – an average of 13,914 a month.
Plethora is in something of a niche, making custom parts. Its clients are American, so it hasn’t been hurt by the administration’s tariffs, as a number of global traders have been. Its biggest selling point is having advanced software that can turn a customer inquiry into a finished product in a few days.
When the company, founded in San Francisco in 2012, was seeking a second production site, it says it chose metro Atlanta for its lower costs, plentiful workforce, access to transit and steady flow of software expertise coming from Georgia Tech.
The 57,000 square feet of factory floor, opened in mid-2019, is barely half used now. But Plethora is planning for its workforce here in Marietta to burgeon from 70 to 250 workers in 2020.
Not like the 1950s — or even the 1990s
Coming out of World War II, manufacturing accounted for nearly one of every three American jobs. In 1990, the earliest data available for Georgia, manufacturing accounted for 17.5% of all jobs. Now, the sector accounts for half that in Georgia.
In Georgia, like across much of the U.S., there have been job cuts among some big manufacturers even as the economy continues to expand.
State filings during 2019 showed aircraft maker Gulfstream in Savannah cutting 362 jobs; Husqvarna shutting its lawnmower factory in McRae and laying off more than 1,000; Exide Technologies’ battery plant in Columbus cutting 251 jobs; Hollander Sleep Products laying off 175 when it shuttered its Thomson plant; and Valmiera Glass slashing 350 positions in Dublin.
These days, though, much of the manufacturing growth, like at Plethora’s Marietta plant, is narrower. It’s tech heavy, not labor intensive, so there are fewer jobs per assembly line. And it’s domestic, not exporting, so products are not buffeted by the winds of trade wars.
Many exporters have been shaken by the nation’s trade tussles and the uncertainty about foreign markets has made many companies hesitant to invest, expand and hire, said Kim Wallace, executive vice president of Hire Dynamics, an Atlanta-based staffing company that fills many jobs in the sector.
That can move the needle in either direction, she said.
“Some manufacturing is increasing as companies try to make things in the United States, depending on where their competitors are,” she said. “But other areas, they are hesitant (about expansion). They are in neutral mode, waiting to see what happens.”
Add it up, and manufacturing is still modestly contributing to the state’s economic growth. Even in metro Atlanta, where the dominant numbers are in office work, health care and hospitality, manufacturing accounts for 175,300 jobs.
Manufacturing jobs were up 4,200 this past year - not nothing, even if it was only 7% of the metro region’s job growth.
More are on the way, said Scott McMurray, the state’s deputy commissioner for global commerce.
In the last six months, the state Department of Economic Development has announced scores of manufacturing projects, totaling more than 4,500 jobs that will be added across Georgia over the next few years, he said.
Quick Start program draws manufacturers — often from far away
Like Plethora, manufacturers are attracted to Georgia’s easy access to transportation, low costs and non-union labor, as well as a healthy flow of engineers from Georgia Tech. The state has also long boasted a pro-business environment and a government that offers numerous financial incentives.
And sometimes it is foreign companies looking for an end-around to avoid tariffs, said McMurray. “Some of the foreign companies think, this is the time for us to establish a manufacturing base in the United States, to dollar denominate our manufacturing.”
For example, Kubota of Japan is buying 300 acres near the company’s current manufacturing facilities in Gainesville-Hall County as part of a planned expansion. Barco, a Belgian firm making electronics, is expanding its plant in Gwinnett County and expects to add 50 jobs.
Japan-based Arglass Yamamura, which makes glass containers, is adding more than 150 jobs in a new plant in Valdosta. The Guidoni Group of Brazil is building a factory in McRae-Helena, creating 455 jobs to make ornamental stones.
Georgia offers incentives to manufacturers, including an exemption on the sales tax for investment on machinery and equipment, typically 7%. The state also funds recruitment, screening and training for new hires.
With an annual budget of about $13 million, the 14-year-old Quick Start program saves companies millions of dollars as they staff up. Part of Georgia’s Technical College System, the program aims to customize training from biotech to production of aircraft components. Government officials say it has done so for more than a million employees placed in 6,500 projects.
A number of line workers came to Plethora through Quick Start, although the company declined to provide details about other incentives. The Guidoni Group and Arglass Yarmamura also filled slots with Quick Start.
Even with a smaller share of the total workforce, manufacturing punches above its weight, contributing more to the surrounding economy than some other sectors.
Workers in manufacturing average $25.33 an hour in Georgia, according to the Bureau of Labor Statistics. That is not as high as construction’s $27.19-an-hour average, but nearly twice that of leisure and hospitality.
Manufacturers also typically spend more on materials, services and research needed to innovate products.
As a result, the sector has a higher “multiplier” effect, said Jeff Humphreys, director of the Selig Center for Economic Growth at the University of Georgia’s Terry College of Business.
The only danger is the vulnerability of manufacturing to larger forces, like an intensified trade war. “The impact of its growth is substantial. But that works the other way around too,” when conditions deteriorate, Humphreys said.
But right now, the economy is growing, domestic demand – especially for consumer goods – is strong, and the companies that effectively use technology to fit the moment are doing just fine.
At Plethora in Marietta, Quinn, the CEO, steps out from the production floor into a room where about a dozen employees sift through customer designs on three-dimensional computer displays.
“We are adding a third shift,” he said. “We’ll operate five days a week, 24 hours a day.”
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