Top concerns: Workers, technology needed

Sunday, October 4, 1998

The Cincinnati Enquirer

A dearth of qualified workers and the non-stop sprint to stay on the technology curve are top concerns of executives with companies on the 1998 Arthur Andersen Greater Cincinnati 100.

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With regional unemployment rates near historic lows, a common theme of executives of companies on the list was the lack of qualified workers, according to a survey of members.

"When you have the unemployment levels in our market," said Mike Dever, president of the Performance Automotive Network, with 1997 revenues of $257 million, "it is really good on one hand. But it makes it difficult to expand."

Technology has some obvious advantages.

"The average salesperson is selling twice as many (vehicles) as five years ago," Mr. Dever said. "It (technology) helps him keep track of his customer base."

Some companies are spurning technology because the executives believe people can do a better job.

"We do not rely on robotic-type equipment," said William E. Barrott III, president of the Aurora Casket Co. "We still believe our people are the experts when it comes to manufacturing, processing and improvements. We utilize their talents to the fullest and produce 160,000 caskets per year."

Of 730 employed at the company, he said, about 430 work in the manufacturing division.

Bob Brown, president of CBS Personnel Services, a company with 1997 revenues of $189.6 million that provides personnel staffing services as well as permanent, temporary and employee leasing, acutely feels the tight job market.

"Our costs of finding good people has tripled in the past year," he said. "Sales have gone up 20 percent to 30 percent but profit has gone down 50 percent.

"We have to spend more time and money -- keep offices open in the morning and on weekends, beat the bushes and look under rocks. God only made so many good people and sometimes it seems like they are all already working. Sometimes it seems like She is not going to make any more."

Economic naysayers were scarce among the group, with 58 percent believing that the American economic expansion would continue through the remainder of 1998 and the first of 1999.

"The economy is real good right now," said David G. Drees, president of Drees Co., a residential and commercial construction company based in Fort Mitchell that ranked fifth on the list with 1997 revenues of $341 million. "It is as good as it has ever been. Right now, people are buying houses left and right."

The survey found that 36 percent of the executives believed there would be a flat economy with one executive expecting a recession. "I think it will be a level type of year next year at the best," said William J. Yung, president of Columbia Sussex Corp. and Affiliates, a Fort Mitchell hotel developer and operator that has four full-service hotels under construction and owns four destination resorts: two in Orlando, Fla., and two in the Cayman Islands.

The company posted $350 million in revenues in 1997.

"Our business is only about 25 percent to 35 percent vacation traveling and leisure," he said. "Most is business travel. We see no increase in occupancy and increases of room rates of 7 to 8 percent."

Mr. Brown of CBS Personnel said he believed the national economy is already getting sluggish.

"Normally, companies that can best forecast the future are firms that sell large, capital-intensive products -- mold manufacturers for GM, for instance," he said.

"They usually know a year to a year-and-a-half out what the economy is going to do. If their back orders are not there, they know companies are not spending money retooling and upgrading. Today, we have that slowdown in back orders in companies in capital-expenditure areas."

Consumers drive the economy, he said, and if radio, television and newspapers focus on a perceived slowdown, consumers respond. Dennis B. Griffin, president of Griffin Industries, a recycler of food and animal by-products for the animals and pet food industries with revenues of $272.2 million in 1997, was even more direct:

"The general economy, is not, I think, as strong as we are led to believe."

Improving products or service was the most common company goal in the upcoming year, followed by technology enhancements, expansion through acquisition and creating a business succession plan. The survey also found that 85 percent of the executives were able to obtain adequate financing -- 15 percent either could not or did not respond to the question -- and 88 percent said their companies were able to keep pace with technology.

In a question with little direct relationship to regional business activities, 50 percent of the company executives gave local government a D or F grade for riverfront and downtown development.

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Top concerns: Workers, technology needed