18 July 2016

Jury hits U. of C. hospital with $53 million malpractice verdict

Original Story: chicagotribune.com

A Cook County jury has awarded $53 million to a 12-year-old Hickory Hills boy and his mother in a 2013 lawsuit filed against the University of Chicago Medical Center, where he was born with a serious brain injury. A Chicago medical malpractice lawyer said this will help to pay for the boy's future healthcare.

The jury's award to Lisa and Isaiah Ewing includes $28.8 million for future caretaking expenses, according to a copy of the jury verdict form provided by their lawyers, Geoffrey Fieger of suburban Detroit and Jack Beam of Chicago. Isaiah has severe cerebral palsy, is in a wheelchair, and needs his mother to feed and clothe him.

It was the biggest birth injury verdict ever in Cook County, said John Kirkton, editor of Jury Verdict Reporter in Chicago.

Their lawsuit outlined about 20 alleged missteps by doctors and nurses after Ewing arrived about 40 weeks pregnant at the hospital and was experiencing less movement by her baby. The mistakes, the lawsuit alleged, included the failures to carefully monitor mother and baby, perform a timely cesarean section, follow a chain of command, obtain accurate cord blood gases, and be aware of abnormal fetal heart rate patterns that indicated distress to the baby, including hypoxia, or a drop in the supply of oxygen.  "The University of Chicago has been, for the last 12 years, completely unapologetic, and even though the evidence was overwhelming that they caused Isaiah's brain damage, they refused to accept responsibility," Fieger said at the news conference Thursday. Ewing hadn't had any problems during her pregnancy, he added.

Before the case went to the jury, the hospital filed for a mistrial.

Fieger's "closing argument shattered the line between zealous advocacy and improper prejudicial comments, rendering it impossible for defendant to receive a fair trial," the hospital's lawyer said in a court filing. "He also prejudicially argued that the defendant's case was built on a falsehood and proceeded to equate defendant's conduct and testimony of its witnesses with the propaganda techniques notoriously and unmistakably associated with Nazi Germany."

Hospital spokeswoman Lorna Wong said the hospital had "great sympathy" for the family but "strongly" disagrees with the jury's verdict.

"Judge Kirby declined to enter judgment on the verdict, as there are pending motions for mistrial based on assertions of Mr. Fieger's improper conduct," she said, noting that it wouldn't be the first overturned verdict involving Fieger.

She said Isaiah and his mother were treated for infection, which can cause cerebral palsy. "Isaiah was born with normal oxygen blood levels," and the "injury occurred before the care Mr. Fieger criticized."

After the news conference, Fieger said he expected the judge to confirm the verdict. "The jury has spoken," he said. A Chicago Brain Injury Lawyer said this is usually how this procedure occurs.

The jury decided the case in four hours, Fieger said. A list of the damages also includes $7.2 million for future medical expenses. The document was signed by 12 jurors.

Fieger disputed that Isaiah had an infection.

"All of the medical records at the University of Chicago neonatal clinic showed that Isaiah had been suffocated at birth, that he had suffered hypoxia, lack of oxygen, yet the University of Chicago and its lawyers came to court and tried to tell the jury that their own records were false, that their own records were mistaken and that Isaiah really had a phantom infection that infected his brain that they could never have known about," Fieger said during the news conference.

Ewing said at the news conference that she has to bathe Isaiah and help him go to the bathroom. She lives in a two-story town home, so she must carry him up and down the stairs.

She said the verdict will help ensure that Isaiah is taken care of after she dies.

Chemical smell at Lynden storage facility closes street

Original Story: bellinghamherald.com

Fire officials said they could not determine the source of a chemical smell at a chemical storage tank locker that caused minor respiratory symptoms for three people and closed 19th Street for several hours Tuesday, July 12.

Three people were treated for sore throats and chest tightness in the incident at K Mini Storage & Mail, 413 19th St., said Lynden Fire Chief Gary Baar. None of the affected people required further examination, he said, but the street was closed for several hours to allow fire crews access to the building.

Whatcom County’s multi-agency hazardous materials team was summoned as a precaution.

“We searched every storage unit,” Baar said. “One unit seemed a little bit suspicious, but it happened to be nothing serious.”

Baar was among the first firefighters at the scene and described the odor as akin to bleach or insecticide. He and other firefighters immediately donned their protective clothing, face masks and air packs, he said.

Haz-mat team members wore full protective “moon suits” to conduct their search. Some 30 firefighters and others worked at the scene. They were going to search chemical holding tanks for leaks.

Crews from Lynden Fire Department and North Whatcom Fire and Rescue responded to reports of a strange chemical smell at 12:35 p.m. Tuesday, said Lynden Fire Assistant Chief Robert Spinner.

Firefighters could not determine what caused the smell after an initial inspection, Spinner said, and detectors did not alert them to any dangerous materials. Officials didn’t evacuate besides the building itself, but 19th Street between Main and Front streets remain closed until the investigation was complete about 7 p.m.., Spinner said.Firefighters and haz-mat crews staged their vehicles across the street at Farmers Equipment Co. and the street was closed so crews could move back and forth freely, Baar said.

Project-by-project, developers help Tampa find its urban roots

Original Story: 83degressmedia.com

Urban renewal is a now-familiar headline across the United States. After half a century of looking to suburbs, Americans are returning to downtowns en masse, swapping white picket fences for Brooklyn brownstones. Contact a Tampa custom home builder today.

How is this broader narrative of urban transformation playing out in Tampa, a city that largely grew up around the automobile and suburban single family home? One way to understand the change happening locally is to look at “infill” development, a real estate and urban planning term that refers to building and investment in areas that are already developed.

83 Degrees asked three local developers working in the infill space to reflect on a few of the key trends, challenges and opportunities shaping their work today. With custom homes in Tampa everyone should be able to get what they are looking for.

Here’s who they are and a glimpse at what they’re up to:

Ken Stoltenberg directs Mercury Advisors, a two-man outfit currently developing the Channel Club, a 22-story, 323-unit apartment tower with an $80 million-plus price tag in downtown Tampa. Stoltenberg also developed Grand Central at Kennedy, a $145 million mixed-use condo project at the heart of the up-and-coming Channel District.

Scott Shimberg leads Hyde Park Builders, which has designed, built and sold over $250 million in local real estate since 1987. He is a custom home builder Tampa.He’s currently working on the first three single-family homes on a 70-homesite project in East Tampa. Shimberg hopes to price the 3-bed, 2-bath homes near 22nd street at a price attractive to working families. He also has a portfolio of midcentury single-family homes in South Tampa that he’s rehabbing for the rental market, among other projects.

Steve Armstrong, Vice President at Comvest Builders, is building two new infill homes in West Tampa this year, which he hopes to market as an affordable alternative to a South Tampa clientele. Comvest’s ten-person team also has a number of custom home and commercial building and renovation projects underway across the Tampa region.

All agree that infill is a relatively flexible term that finds definition in a wide variety of developments that can be seen across Tampa, at once taking the form of midrise rental apartments popping up in Westshore, new mixed-use towers rising in downtown, posh raise-and-rebuild projects happening lot-by-lot across South Tampa, and single-family workforce homes being built in ex-industrial East Tampa.

Finding the local sweet spots between housing demand and supply

Although each of these developers works in different corners of the market, they collectively point to two demographic variables driving demand for development in Tampa’s urban heart: city-minded Millennials and downsizing Baby Boomers.

“Being close to town and amenities is ever more important,” says Armstrong of the Tampa market, pointing to Seminole Heights and South Tampa.

Stoltenberg agrees. He says that although his clientele includes a fair number of Millennials, it’s the “Baby Boomers who are done raising kids in the suburbs and want to be down here (Downtown Tampa) where they can get to things easier and get to amenities” like concert venues, museums, restaurants and nightlife.

Shimberg reasons that while Boomers were focused on raising their kids in Carrollwood and Brandon, now that they’ve found empty nests they can start to “think about themselves.” Long drives across the Crosstown and yard work become less and less appealing when Tampa’s old neighborhoods can now offer “the ability to have every aspect of your lifestyle within that core area, your restaurants, your cool little shops and bars.” Tampa custom homes gives each type of family what they need.

Developers like Stoltenberg were on the “front lines of those trends,” continues Shimberg. “If you look at an area like the Channel District, years later you see tenfold the amount of development. It’s not just residential – it’s retail too. Development feeds on itself.”

Consumer preferences for walkable neighborhoods and amenities like nightlife aren’t the only dynamics driving how and where local redevelopment, however. Not only did the Tampa real estate market absorb some of the biggest shocks from the 2008 global financial crisis, the local real estate market in many ways played a key role in fueling the subprime mortgage meltdown that underpinned it.

For several years, Wall Street lenders and real estate investors balked at the prospect of investing in new construction in inner city Tampa. Large private equity firms like Blackstone picked up “distressed” properties in bulk and helped to create a local real estate owned-to-rental market that attracted investments from builders like Shimberg.

Today, with more confidence in the local market and the broader economy, investors are warming up to multi-family rental housing, including those amenity-rich, upscale rental mixed-use developments that seem to be sprouting up everywhere. Jeff Vinik’s ambitious plans for the Channel District, backed by Bill Gates’ Cascade Investment, have played a critical symbolic role in boosting investor confidence in the Tampa market for new construction.

That growing investor interest, coupled with low interest rates, is translating to more construction around town and inspiring more to take the “leap of faith” and move to Tampa’s older neighborhoods.

“People are starting to realize that Tampa is a market they can lay claim to and make an impact in. The more that happens, the more folks that look to live down here,” says Shimberg. The idea of moving back to the city? “It becomes a ‘sure, why not?’”

Both of these observations are consistent with the broader themes reflected in the Emerging Trends in Real Estate report released by the Urban Land Institute earlier this year. That report identified other trends like local food systems, climate change and innovations in transportation as drivers of change in cities across America.

Bringing infill to market

Aside from marrying investors with would-be renters and homeowners, developers juggle a unique set of challenges and opportunities in the infill space. Density -- the concentration of development, usually measured in the number of dwelling units per acre -- makes infill development viable, explains Shimberg.

But with density comes higher construction costs, more logistics and planning codes that don’t always favor city-minded development. Shimberg points to parking minimums in Tampa’s current planning code, which were created during a more car-centric era. “If the code requires two 200 square foot parking spaces for each house, that’s 400 square feet that could go towards living space or a granny flat.” Those requirements can impact project costs and undermine efforts to create a more walkable neighborhood.

Many infill sites are also burdened with pollution from previous land uses, or have infrastructure that wasn’t built or maintained with high-density development in mind. That’s where the City of Tampa enters as a partner for development, helping builders to clean up so-called “brownfield” sites and using mechanisms like tax increment finance, or TIF, to help pay for new public infrastructure.

Both Stoltenberg’s Channel Club project and Shimberg’s East Tampa project are in Community Reinvestment Areas, or CRAs, special areas where the city uses TIF to support private development. Stoltenberg says that the 30-year Channel District CRA facilitates between $3-4 million a year in public infrastructure investment in the neighborhood, including a new sewer and stormwater system.

Unlike other corners of the city, South Tampa doesn’t have a designated CRA. Tampa Mayor Bob Buckhorn is currently shopping a citywide stormwater assessment fee proposal to fund fixes for the low-lying area’s growing flooding issues. A combination of increasing development pressures, deferred maintenance and rising seas has put the area’s aging stormwater infrastructure under stress – an infill challenge in some ways unique to coastal Tampa.

“Everyone’s taking the 1950s, ‘60s, ‘70s homes and knocking them down and putting in newer homes. You see a 1,500-square-foot being replaced by a 3- or 4,000-square-foot home on the same plots with a lot less yard, with minimal outdoor spaces, and lots of living square footage,” says Armstrong about South Tampa.

That development leaves less room for ground absorption and strains infrastructure. Ironically, it may be National Flood Insurance Program requirements, designed to improve community resilience to flooding, that is tipping the balance in favor of rebuilds over renovations. NFIP rules limit the amount of money that can be spent renovating existing homes insured through the program to no more than 50 percent of their market value, explains Armstrong.

Much of South Tampa is in the NFIP-designated floodplain, and about 40 percent of all NFIP policies cover Florida flood risk. The heavily indebted program is currently facing significant pressure for reform. Recent tweaks to the program have had major impacts on the affordability of flood insurance in areas like South Tampa, in some ways shaping who can afford to renovate or rebuild their homes, Armstrong adds.

A new report from the global real estate consulting firm CoreLogic -- released just in time for the start of the 2016 Atlantic Hurricane Season -- ranked Tampa the third most at-risk city in America for hurricane-fueled storm surge. The Tampa area’s exposure: nearly half a million homes with a replacement value of over $80 billion.

Taking the longer view

A slew of other reports have also identified Tampa as one of the world’s most at risk when it comes to the related, longer-term impacts of sea level rise making the need for a Tampa custom home builder with experience even that more important. Earlier this year, 83 Degrees published a 7-part series on climate change adaptation efforts underway across Tampa and the broader region, including how the real estate and property insurance industries are evolving to cope with changing climate risks. 

Despite these current and emergent challenges, Stoltenberg says he isn’t too worried -- at least not yet. “Two or three feet of sea level rise wouldn’t do anything to our building so long as the public infrastructure around us worked,” he says. “It’s not the newer buildings” that are at risk to flooding and other environmental risks, he says, but “it’s newer buildings in areas with old infrastructure.”

Collectively, this group says their investors -- on Wall Street and Main Street alike -- aren’t screening for climate change risks, at least not yet.

Steve Armstrong hopes to help weave sustainability into more local development. He’s a certifying agent for the Florida Green Building Council and he’s on the board of the Sustany Foundation, which promotes sustainability in the Tampa Bay area. One day, he hopes to build a personal home that can serve as a net zero, low impact showcase for climate-smart local living.

Shimberg, whose father moved to Florida in the 1950s to develop Town ‘n’ Country, is also hopeful that the local development community will evolve to help the city meet the challenges posed by climate change.

While Tampa is “discovering itself,’’ Shimberg says, “the development community is open to ideas as to what might be the right solution. They want to be part of the conversation.”

Even with these big picture issues in view, be it regional transportation and congestion woes, sprawl and growth management, or sea level rise and climate change, Tampa’s inner city construction boom continues. Cranes perch over downtown streets. The Tampa Riverwalk thrives and Curtis Hixon Park overflows during weekend concerts and festivals. Cafes and bars open on to street corners once quiet. And, piece-by-piece, project-by-project, Cigar City rediscovers its urban roots.

17 July 2016

Sneak Peek: Developer debuts custom luxe home tour in Cypress amid oil slump

Original Story: bizjournals.com

Caldwell Cos. opened its first gated custom home section in the Towne Lake master-planned community back in 2012 — when oil prices were high and Houston’s luxury home market was booming. Custom home builder Tampa

The Houston developer typically sells about 15 to 20 homes a year in Water’s Edge at Towne Lake. The exclusive Cypress neighborhood boasts mansions costing between $750,000 to $2 million on half-acre or larger waterfront lots with private boat docks.

When oil prices plunged a year ago, Houston’s luxury home market started to cool. Water’s Edge is on track to sell about 14 homes this year, slightly less than during the boom years.

Caldwell Communities has turned to a tried-and-true method to boost sales of million-dollar homes in Towne Lake. The developer is launching its first custom home showcase in Water’s Edge. Click through the slideshow to take a tour of the homes.

Five of the seven custom homebuilders who are building in Water’s Edge at Towne Lake will participate in the inaugural custom home showcase, which begins this weekend. Bavaria Builders, Braziel Building Group, Brickland Homes, Drees Custom Homes and Frontier Custom Builders are expected to welcome hundreds of prospective homebuyers and curious viewers into their speculative inventory homes between July 16 to 24.

Home tours are often used to lure homebuyers to consider purchasing a new home, but can also show off new trends in custom homebuilding. The five custom homebuilders in the Towne Lake showcase tour will feature their plush bathrooms and master closets, massive kitchens with double islands, unique architectural features like domes and barrel ceilings and high-end amenities like smart home systems.

“Custom homebuilders don’t have finished model homes like this,” said Jennifer Symons, vice president of marketing at Caldwell Cos. “This is a great opportunity for them to show off what they can do.”

Towne Lake is a 2,400-acre master-planned community boasting a 300-acre man-made lake in Cypress, northwest of Houston. Residents of Towne Lake can boat, fish and water-ski on one of the largest man-made lakes in Texas. Homes range in price from the $200,000s to more than $1 million.

Developer Caldwell Cos. has opened several new amenities within Towne Lake, including a new Kroger grocery store, sandy beach and waterpark and The Boardwalk at Towne Lake mixed-use development, which has attracted several new retailers and restaurants to Cypress. Residents can ride their motorboats to work, eat and play at The Boardwalk.

05 July 2016

Builders urge caution as Congress reauthorizes flood insurance program

Original Story: westplainsdailyquill.net

Extreme flood insurance rate hikes and inaccurate floodplain maps drive up the cost of homeownership and threaten small businesses, the nation’s home builders told Congress today.
Randy Noel, Second Vice Chairman of the National Association of Home Builders (NAHB) and a home builder from LaPlace, La., told the Senate Committee on Small Business and Entrepreneurship that NAHB has long supported practical, common-sense changes to the National Flood Insurance Program (NFIP). If you are looking for a Tampa custom home builder then try to build in an area that is not classified in a floodplain.
“However, as Congress works to reauthorize the NFIP program by the September 2017 deadline, it must guard against the exorbitant rate hikes and faulty floodplain delineations that have plagued the program in the past,” Noel said.
In 2012, with the NFIP facing insolvency, Congress enacted the Biggert-Waters Flood Insurance Reform Act to ensure the program’s fiscal soundness. Unintended consequences from the legislation caused significant problems for home owners and prospective home buyers by triggering an immediate shift to full-risk rates phased in over four years.
“Home builders live and work in their communities. We see the effects of flood insurance rate increases in our personal and professional lives,” Noel added. “One Louisiana buyer bought a home only to realize the flood insurance rates had increased from $400 annually to the full-risk rate of over $13,000.
“And a neighborhood near my home in St. Charles Parish was fully devalued because of flood insurance rate increases. FEMA wouldn’t certify the levee protecting the community because it wasn’t maintained by the U.S. Army Corps of Engineers. After Biggert-Waters was enacted, home owners in that neighborhood were paying between $12,000 and $17,000 annually for flood insurance.
“The community mailed FEMA their house keys and told FEMA to keep them because the homes were worthless,” Noel added.
Flood insurance rate increases also have a direct impact on home builders. The rates make it much more difficult for owners of older properties to sell their homes and “move up” to a newly constructed home that is more resilient and built to higher construction standards. This puts local builders’ businesses in jeopardy and also constrains the local economy, he said.
Noel thanked the committee for acting quickly to remedy the problems caused by the Biggert-Waters legislation and said that NAHB estimates that nationwide there was an additional $755 million in new construction and $361 million in remodeling in 2014 because those issues had been solved.
Kevin Robles, a home builder from Tampa Bay, Fla., told the committee that housing prices in Florida are still 22 percent below normal due to the Great Recession.
“Any negative change to the market, such as flood insurance rate increases, could have long-term unintended consequences to Florida’s economy,” Robles said.
“I am a small business owner and at least a quarter of my customer base is active or retired military. I am constantly reminded of the need to keep housing prices affordable. In Florida, for every $1,000 increase in home prices, more than 8,000 households are priced out of the market,” he said.
Robles added that in Florida where there are large Special Hazard Flood Areas, it is extremely difficult to avoid building in or near a floodplain, so inaccurate floodplain maps are very problematic for builders. It can take months and cost hundreds of thousands of dollars to change the flood maps or elevate a property.  This can affect many custom homes in Tampa.
“There have been reported cases of FEMA neglecting to factor in privately funded flood control structures, or drawing in rivers or streams where none exist,” he said “Home owners are being incorrectly mapped into floodplains and forced to purchase unneeded flood insurance. It typically takes years for these mistakes to be fixed, often requiring a lengthy and costly process for the community, builder and home owner.”

01 July 2016

Block party for developers

Original Story: businessobserverfl.com

A so-called super block in downtown St. Petersburg, part of a complicated battle and now agreement between a preservation group and landowners, is open for development.

“We are thrilled to have reached an understanding that we believe benefits everyone,” says Don Mastry, an attorney for First States Investors, one of the key players in the agreement.  People are already starting to search for a Tampa custom home builder.

The complex, two buildings in the 400 block of Central Avenue, has often been called the cheese grater, for the metal exterior placed on it in the 1960s. In the 1920s, the building was home to the Pheil Hotel and Theater, a St. Pete hotspot. Future potential uses under city development codes for the property, vacant since 2006, include retail, a hotel, office or residential space, plus parking.

While people on both sides of the debate praised the agreement in public statements, the process that led to it was acrimonious and lengthy.

First, there was disagreement over lease terms and other stipulations between two groups with ownership stake in the property. Those sides, First States Investors and the Pheil family, with a heritage that includes Abram Pheil, mayor of St. Petersburg in 1912 and 1913, settled their dispute earlier this year. They agreed to clear the block and seek a new developer to go forward with a project, according to a statement. Some don't like the idea and are looking for Tampa custom homes for their needs.

But St. Petersburg Preservation protested the agreement. The nonprofit sought to have the buildings designated as local historic landmarks, which would change the development potential. St. Petersburg Preservation, according to the statement, also objected to demolition proceedings without a plan in place and approved. The effort included a lawsuit and multiple appeals with city officials and departments.

The St. Petersburg Community Planning & Preservation Commission voted 5-2 against designating the property a local historic landmark, and city staff recommended council members make the same call. City council was scheduled to vote on the issue June 16, but St. Petersburg Preservation reached an agreement with First States Investors/the Pheil family that made the issue moot.

The gist of that agreement: St. Petersburg Preservation dropped its protests and lawsuit, which paves the way for demolition and development. In return, First States Investors will work with St. Petersburg Preservation to “further the preservation and reuse of historic sites and structures elsewhere in St. Petersburg,” the release states. First States, the release adds, will also make a $100,000 donation to St. Petersburg Preservation.

“While we have had tremendous grassroots community support,” says St. Petersburg Preservation Vice President Peter Belmont, “and it is difficult to lose these buildings on the 400 block, this result will be a positive as we work to further preserve our city’s historic resources for the future.”

Special Report: State of the Profession 2016

Original Story: assemblymag.com

Manufacturing today is leaner and greener than ever. Many engineers are focusing on lightweight materials and sustainable production initiatives. In addition, additive manufacturing is transforming how a wide variety of products are designed and assembled.
Those trends are forcing manufacturers to invest in new tools and technologies ranging from collaborative robots to wearable devices. In fact, the 21st annual ASSEMBLY State of the Profession survey finds that more than one out of three companies (42 percent) will be allocating more resources toward assembly operations during the next 12 months.
More than one-half (59 percent) of respondents claim their plant has implanted green manufacturing programs, such as energy-efficient lighting, within the last 12 months. That’s a 10 percentage point increase over 2015. Use of additive manufacturing technology is up 6 percentage points, while use of lightweight materials is up 3 percentage points.
Not surprisingly, overall job satisfaction levels are at the highest they’ve ever been. More than one-half (52 percent) of assemblers claim they are “highly satisfied,” which is 3 percentage points higher than 2014 and 7 percentage points higher than 2013. Only 4 percent claim they are “not satisfied.”
Eleven percent of assembly professionals report that their company reshored assembly operations during the last year. And, 14 percent expect their employer to bring work back to the states during the next 12 months, which is a 2 percentage point increase over 2015.
In addition, 23 percent of respondents work for companies that plan to expand existing facilities or build new assembly plants during the next 12 months. Construction activity will be strongest in the transportation equipment industry (42 percent), followed by plastics and rubber (40 percent) and aerospace (26 percent).
Large manufacturers (companies with 2,000 or more employees) will be building the most infrastructure (42 percent vs. 16 percent of small manufacturers). Almost one-third (32 percent) of respondents in the West anticipate plant expansions during the next 12 months, followed by the Midwest (29 percent), South (19 percent) and Northeast (11 percent).
The optimistic results of the 2016 State of the Profession report are backed up by several studies conducted by other organizations.
The United States currently sits just behind China in terms of manufacturing competitiveness, and is expected to overtake that country by 2020, according to a recent study by consulting firm Deloitte Touche Tohmatsu and the Council on Competitiveness.
“The United States improved its ranking from fourth in 2010 and now ranks highest as an advanced manufacturing economy,” claims Deborah Wince-Smith, president and CEO of the Council on Competitiveness. “The country is highly competitive in terms of its share of high skill and technology contribution to exports and labor productivity as measured by gross domestic product.
“Made in the USA is making a big comeback,” adds Wince-Smith. “Contrary to the view that manufacturing is dirty, dumb, dangerous and disappearing, our study points to a manufacturing future characterized by innovation-driven growth. Manufacturing is sustainable, smart, safe and surging. And, America will lead the world in this transformation.”
“Just as the competitive landscape is changing for U.S. manufacturers relative to their foreign counterparts, so is the market environment for manufactured goods,” notes Jacob Prak, CEO of Michigan Manufacturing International, which supplies bearings, gears, machined parts, mechanical assemblies, stampings and other types of fabricated metal components to manufacturers in a wide variety of industries. “Design and manufacturing are becoming simultaneously more automated and more flexible.
“Real-time information gathering and analysis are allowing factories to react immediately to changes in conditions or requirements,” notes Prak. “Continued improvements in design tools permit them to more easily interface with production equipment. This has shortened the time and effort required to get from concept to production.
“One of the main results of these changes is that short production runs of high-quality products have become possible, while long-run production is reaching quality and efficiency standards that were not possible even a few years ago,” claims Prak. “Conversely, for simple, undemanding, manufactured goods, there has been a democratization of the production process that either has or will drive out established producers.”
“I have great confidence in the future of manufacturing,” adds Jay Timmons, president and CEO of the National Association of Manufacturers. “Our shop floors are no longer the factories of our parents’ generation; they are state-of-the-art facilities driving an innovation revolution that will change our lives and strengthen our country.”

Economic Roller Coaster

The MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation, forecasts manufacturing production growth of 2.6 percent in 2016, 3 percent in 2017 and 2.8 percent in 2018. Factors such as a strong U.S. dollar, falling commodity prices and risk aversion have not dissipated and are the cause of this slow growth.
“The sector’s erratic pattern of surges and declines isn’t providing a solid footing for expansion,” says Daniel Meckstroth, Ph.D., MAPI chief economist. “Manufacturing is facing a number of challenges, including high inventories, collapsing oil prices, an unwillingness to invest, and an appreciating dollar that makes exports more expensive to foreign buyers.
“Strong employment growth amid little inflation boosts consumer income and spending,” explains Meckstroth. “Another impetus is easy credit availability, which propels big-ticket spending for motor vehicles, residential housing and nonresidential construction.
“Motor vehicle and housing supply chains are the driving force offsetting the deep recession in mining and energy capital spending, and the pervasive drag of a strong dollar,” Meckstroth points out. “The 2016 outlook is helped by the absorption of the negative shocks in 2015, such as the severe winter that disrupted transportation and shut down plants.
“There will not be another West Coast port strike, and oil and gas prices will not drop by half again [this] year,” notes Meckstroth. “And, while the dollar may appreciate somewhat in 2016, it will not surge 15 percent again. The absence of these negative shocks provides some positive momentum.”
ASSEMBLY’s 2016 State of the Profession study was conducted in March, as the manufacturing sector experienced mixed news. On one hand, the U.S. Department of Labor reported that the sector lost 23,000 jobs since the start of the year. And, the National Association of Home Builders (NAHB) claimed that demand for new housing fell 9 percent in March.
“Single-family starts [were] off from their strong showing in February, but this slowdown represents a return to a long-run, gradual growth trend that is consistent with builder confidence levels, which are overall positive,” says Robert Dietz, NAHB chief economist.
At the same time, there were bright signs for manufacturers during the first quarter. For instance, AMT’s U.S. Manufacturing Technology report for March showed that orders grew 37 percent compared to the previous month. However, orders were down 12 percent compared to March 2015.
“While dealing with persistent economic challenges and a softer market that’s likely to last into the fourth quarter, manufacturers are leveraging productivity gains to stay competitive,” says Douglas Woods, AMT president. “The outlook from industry economists improves toward year’s end on two particular strengths of the U.S. economy: foreign direct investment and a resurgent consumer base.
“For now, manufacturing technology makers are focused on finding markets that offer the best opportunity, like automotive, aerospace and medical,” Woods points out. “Sentiment among manufacturing executives remains optimistic about future capital equipment investment.”
A majority (90 percent) of respondents to ASSEMBLY’s survey expect their company to commit either the same amount or more resources toward operations during the next 12 months. Manufacturers in the transportation sector, which includes automobiles, car parts, motorcycles, recreational vehicles and trucks, are the most optimistic. Indeed, 51 percent of those assemblers claim their companies will be committing more resources toward improving operations.

Auto Production Accelerates

Auto sales continued to surge during the first quarter. That was on top of a record-setting 2015, when 17.5 million cars and trucks were sold in the United States.
“New-vehicle sales for cars and light trucks are on pace to reach 17.7 million vehicles,” claims Steven Szakaly, chief economist at the National Automobile Dealers Association.
According to Szakaly, the average transaction price on a new vehicle was nearly $34,000 at the end of the first quarter, thanks to an increase in light-truck sales and the purchase of more options on vehicles.
“With low interest rates, low gasoline prices and a rich selection of new vehicles with improved fuel and safety technology, it remains a great time for consumers to buy a car,” says Szakaly.
Low fuel prices are also helping to accelerate a long-term trend in U.S. motor vehicle sales that continues to favor light trucks over cars. “We expect light trucks to reach 57 percent of the new-car market this year,” notes Szakaly.
Some industry observers are even more bullish. IHS Automotive predicts there’s still tremendous upside potential as a strengthening U.S. economy and stronger employment rates push demand to 18 million units.
“The U.S. auto market has been powered by a combination of low interest rates and low gas prices, allowing for market momentum to remain strong,” explains Henner Lehne, senior director of global light vehicle forecasting at IHS Automotive. “Although interest rates will be a slight headwind, buying conditions will remain positive, allowing the market to continue to grow in 2016 and 2017.”
John Murphy, senior automotive analyst at Bank of America Merrill Lynch, believes the auto industry will remain strong for at least two more years. In fact, he’s forecasting 18.2 million units for 2016, followed by 19 million in 2017 and 20 million in 2018. Murphy bases his bullish outlook on replacement cycles—the average vehicle in the U.S. is 11 years old.
Over the next three years, automakers also plan to ramp up the speed at which they replace models. According to Murphy, 58 percent of the new vehicles launched in the U.S. between now and the end of the decade will be cars or sport utility vehicles. That’s up from 49 percent over the last 10 years.
The number of vehicle launches will average 58 a year from 2017 to 2020. That’s in sharp contrast to an average of 38 new vehicle launches annually between 1997 and 2016.
By 2020, Murphy claims that new vehicles will be on sale at U.S. dealer showrooms for an average of two years since a model was last launched or redesigned, down from three years in 2016.
That’s why automakers and suppliers are pouring millions of dollars into their assembly plants. According to the State of the Profession study, 42 percent of assemblers in the transportation sector work for companies that are expanding current facilities or building new plants.
Ford Motor Co. is investing $9 billion in its U.S. manufacturing facilities. Factories scheduled to receive upgrades include the Cleveland Engine Plant, the Kentucky Truck Plant, the Livonia Transmission Plant and the Ohio Assembly Plant. However, the automaker has come under some criticism for building a new assembly plant in Mexico that will produce small cars.
Tier One suppliers are also investing in new facilities to boost productivity, improve throughput and address quality concerns. Dana Corp. is building a $70 million Jeep axle plant in Toledo, OH. Flex-N-Gate is investing $95 million in a new plant in Detroit that will supply Ford Motor Co.
Although the automotive industry has been rewriting the production record books lately, it’s also plagued with more quality problems than ever. And, quality continues to be a concern for manufacturers in all industries.
More than two-thirds (69 percent) of State of the Profession respondents are currently dealing with issues relating to quality. In addition, more than one-half (55 percent) of respondents claim that product quality will be the biggest challenge to their companies’ success during the next 12 months. That’s 2 percentage points higher than in 2015.
Product quality is more important to large manufacturers (companies with more than 2,000 employees) than small manufacturers (companies with fewer than 100 employees). Three-fourths (75 percent) of large companies are struggling to address product quality vs. only 54 percent of assembly professionals at small manufacturers.
Sixty-four 64 percent of assemblers in the transportation equipment industry are concerned with quality-related issues, followed by electrical equipment and appliances (61 percent) and fabricated metal products (59 percent).
Last year was record-setting both in the number of autos recalled and recall campaigns. According to the National Highway Traffic Safety Administration, 51 million vehicles were recalled in 2015, slightly more than the 2014 total. There were almost 900 separate recall actions, nearly 100 more than the previous year.
Takata air bag inflators were linked to approximately 42 percent of all recalled vehicles last year. The largest non-Takata recall of 2015 was issued by Toyota, related to a power window electrical switch that could short-circuit and potentially catch fire. It affected more than 1.8 million vehicles.
“[The auto industry is] on the cusp of a new era of heightened recall activity,” says Neil Steinkamp, managing director at Stout Risius Ross Inc. (SRR), which conducts an annual study on the topic. “A major characteristic of this new era is the impact of software and wireless technology.”
According to SRR’s analysis, software-related recalls have risen sharply in recent years. In 2011, less than 5 percent of all recalls were software-related. By the end of 2015, the rate had risen to 15 percent.
“Today’s cars can contain over 100 million lines of code,” claims Steinkamp. “For perspective, an F-35 joint strike fighter jet contains about 9 million. When you have that much software in a car—and particularly when much of that software is relatively new—there are going to be some issues.”
According to Steinkamp and other experts, manufacturing-related recalls are directly related to the growing complexity of vehicles.
“When as few as four extra options are added on an assembly line, it can lead to two extra recalls,” explains Rachna Shah, associate professor of supply chain and operations at the Carlson School of Management at the University of Minnesota, who recently conducted a study on the subject.
“Switching between different tasks to install options within a short period of time adds complexity to workers’ job tasks,” adds Shah. “It also affects quality inspectors, who, under increased pressure, miss mistakes.”

Compensation Variables

The typical State of the Profession respondent is 54 years old, has 24 years of experience and earns $91,533. However, there are exceptions at both the high and low ends of the scale. For instance, 22 percent of respondents take home less than $65,000 per year, while 40 percent earn more than $95,000.
On average, men earn 24 percent more than women. And, more than one-quarter (27 percent) of women respondents earn less than $60,000 vs. 16 percent of men.
Part of this discrepancy is due to the fact that women make up 47 percent of the U.S. labor force, but only 27 percent of the country’s manufacturing workforce.
Many female respondents to ASSEMBLY’s survey also have less experience than their male counterparts. Women represented only 6 percent of respondents and had an average of 14 years of experience vs. 25 years for men. In fact, more than three-quarters (82 percent) of men have more than 15 years of experience in the assembly field, while 37 percent of women have less than 15 years of experience.
In addition to gender, several other factors determine pay rates, such as age, education, experience, location and type of industry.
Industry experience is the biggest factor that determines compensation. Individuals with more than 25 years of experience (48 percent of respondents) earn more than assemblers with less than 15 years of experience in the assembly field (29 percent of respondents).
Assembly professionals tend to be loyal employees who stay with the same company for many years. In fact, 40 percent of respondents have worked at the same firm for more than 10 years, while 20 percent have been with their present employer for less than three years.
More than one-half (56 percent) of ASSEMBLY’s respondents received a pay increase over the last 12 months. However, 8 percent experienced a decrease in salary. Salary raises varied widely, but the average increase was 5 percent, which is 1 percentage point higher than in 2015.
Forty-eight percent of respondents received a cash bonus during the last 12 months. Bonuses were typically tied to overall company and plant performance, in addition to implementing successful cost reduction programs, meeting deadlines for new projects and launching new products.
Two-thirds (67 percent) of assemblers who work in the machinery manufacturing industry received a cash bonus during the past year, followed by assemblers in the fabricated metals (65 percent) and transportation equipment (52 percent) industries.
More than one-half (56 percent) of assembly professionals will probably receive a salary increase at their next review. Assemblers in the computer and electronics industry feel most confident about receiving a raise in the near future. Indeed, 82 percent of those individuals say they expect a raise, followed closely by assemblers in the aerospace industry (78 percent).
However, respondents who work for contract manufacturers are less optimistic. Only 20 percent of them expect to receive an increase in their salary during the next 12 months.
Assemblers who work for larger manufacturers (1,000 or more employees) are more likely to receive a raise during the next 12 months than those employed by companies with less than 100 employees. More than one-half (63 percent) of respondents at large companies also expect to get a cash bonus vs. 52 percent of assemblers at small manufacturers.

Geographic Discrepancy

Assembly salaries typically fluctuate from region to region, due to the local cost of living. For instance, a house that is $300,000 in Peoria, IL, can cost at three times that much in the suburbs of Chicago.
The Northeast (Connecticut, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont), which is home to 19 percent of State of the Profession respondents, boasts the highest salaries—an average of $106,135.
On the other hand, assemblers in the South (Alabama, Arkansas, Delaware, Florida, Georgia, Kentucky, Louisiana, Maryland, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia and West Virginia), which is home to 26 percent of respondents, average $84,378.
Assemblers in the West (Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington and Wyoming), which is home to 16 percent of respondents, average $102, 964.
With an average salary of $87, 685, the Midwest most closely resembles the national average of $91,533. That region, which is home to 39 percent of respondents, includes Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin.
Only 30 percent of assembly professionals in the South earn more than $100, 000 vs. 59 percent of assemblers in the West.
Assemblers in the West tend to work two hours a week less than the national average of 47 hours. And, only 7 percent of respondents in the West expect to work more hours during the next 12 months vs. 30 percent of assemblers in the South.
Assembly professionals in the Northeast tend to be more satisfied than their peers in other parts of the country. More than two-thirds (67 percent) claim to be “extremely satisfied” vs. 39 percent of assemblers in the South.
The size of a manufacturer typically determines compensation levels. For instance, assembly professionals at small manufacturers (companies with less than 100 employees) earn an average of $81,918. Assemblers who work in companies with more than 2,000 employees earn an average of $94,263.
But, assemblers who work for smaller firms tend to be much happier (62 percent) than people who work for big companies (42 percent).
Assembly professionals in the fabricated metal products sector receive higher salaries than their peers in other industries. For instance, they earn 8 percent more than the national average of $91,533. Assemblers in the machinery, aerospace and transportation equipment industries also receive higher-than-average compensation.
Manufacturing engineers (21 percent of respondents) earn more than design engineers (9 percent of respondents). According to the 2016 State of the Profession survey, manufacturing engineers earn an average of $87,233 vs. $75,756 for design engineers.
Age is another important factor that affects compensation. For instance, assembly professionals who are more than 50 years old (72 percent of respondents) typically earn the highest salaries. They average $91,801 vs. assemblers who are under 40 (15 percent of respondents), who earn an average of $77,245.
Salaries also fluctuate widely based on type and level of education. For example, assembly professionals with just a bachelor’s degree (34 percent of respondents) earn an average of $88,517. However, assemblers who’ve earned a master’s degree (19 percent of respondents) earn $99,781.
Obtaining a master’s in business administration (MBA) or a lean-six sigma black belt is a good way to ensure a higher salary. Assemblers with MBAs (15 percent of respondents) earn an average of 18 percent more than non-MBAs. Assemblers with black belts (9 percent of respondents) earn an average of 17 percent more than others.

Time Marches On

Assemblers work an average of 46 hours a week. In fact, two-thirds (67 percent) of 2016 State of the Profession respondents often work more than 45 hours a week. People in the plastics and rubber industry tend to spend the most time at work (an average of 52 hours per week), while assembly professionals in the medical equipment and supplies industry work less (an average of 44 hours per week).
Eighteen percent of assemblers claim that their average work week will increase during the next 12 months, which is 4 percentage points higher than in 2015. More than one-third (40 percent) of assembly professionals who work for contract manufacturers expect to work more hours during the next 12 months, followed by assemblers in the machinery sector (27 percent).
Assemblers at small manufacturers plan to spend more time at work than their counterparts at larger companies. Twenty percent of respondents who work for manufacturers with less than 100 employees expect to work more in the next 12 months. However, only 9 percent of assemblers who work for companies with more than 1,000 employees expect to experience longer work weeks.
Smartphones and other portable electronic devices may be partially to blame for those extra-long hours. Many company-issued devices are blurring the lines between workday and off hours. However, personal devices are also contributing to wasted time at work.
“While technology helps workers stay connected while away from the office, in many cases it is causing them to disconnect while in the office, leading to a negative impact on productivity,” says Rosemary Haefner, chief human resources officer at CareerBuilder LLC, which recently conducted a study on the topic.
“More than eight in 10 workers have smartphones and keep them within eye contact at work,” claims Haefner. “While we need to be connected to devices for work, we’re also a click away from alluring distractions from our personal lives, like social media and various other apps.”
Despite having many digital tools available, the majority (63 percent) of participants in ASSEMBLY’s study say that they are doing the same amount of work-related travel today vs. one year ago. In fact, 22 percent of assemblers claim they are doing more travel, which is 6 percentage points higher than in 2015 and 10 percentage points higher than in 2014.
More than one-half (56 percent) of respondents also believe that time constraints will affect their ability to do their jobs during the next 12 months. Time-related pressure will pose the biggest challenge to assemblers who work for contract manufacturers (73 percent), computer and electronics (65 percent) and transportation equipment (60 percent) manufacturers.
Assembly professionals at large manufacturers (companies with 1,000 or more employees) are under more pressure to watch the clock than people who work for small manufacturers (companies with less than 100 employees). Indeed, two-thirds (69 percent) of respondents at large companies cite time constraints as a challenge vs. only 49 percent of assemblers who work at small firms.
In addition to time management, assembly professionals will spend more time on manufacturing flexibility (62 percent) in the near future, which is 3 percentage points higher than in 2015.
A majority (74 percent) of respondents in the fabricated metal products industry will be focusing on making their assembly lines more flexible during the next 12 months. Other industries tackling flexibility issues include aerospace (70 percent), machinery (67 percent), transportation equipment (62 percent) and medical equipment (61 percent).

Productivity Tools

More and more manufacturers are equipping assemblers with state-of-the art technology to address time constraints and boost productivity. In fact, 7 percent of State of the Profession respondents plan to deploy smart glasses, smartphones and other devices on the plant floor in the next 12 months.
Wearable technology allows workers to access important information, such as work instructions, with just voice commands. This allows them to stay at their workstations and be more productive.
Large manufacturers (19 percent) are more likely to deploy wearable technology vs. only 3 percent of small manufacturers.
Smartphones are popular with more than one-half (51 percent) of assemblers. Other wearable technology being deployed on assembly lines include smart glasses (49 percent), gloves (40 percent) and watches (7 percent).
Twelve percent of assembly professionals in the aerospace industry plan to follow the lead of Airbus and Boeing by investing in wearable devices. Other industries eager to use the technology include transportation equipment (8 percent) and fabricated metal products (8 percent) manufacturers.
Tractica LLC predicts that worldwide shipments for industrial wearables will increase from 2 million in 2015 to 66 million units annually by 2021. “[Workplace wearables] continue to see high levels of interest and market momentum as companies across a wide variety of industry sectors conduct trials and plan deployments with a diverse set of devices,” says Aditya Kaul, research director at Tractica.
Airbus engineers have developed “connected glasses” for assemblers to wear on the A330 jetliner final assembly line in Toulouse, France. The glasses enable cabin assembly personnel to designate the exact location where seats and other cabin furnishings should be affixed inside the aircraft, without having to constantly refer to printed documents.
The head-worn technology features a camera to scan barcodes so the user can see the specific cabin plans and information based on individual customer requirements, as well as view the marking zone. The glasses also feature an offset screen that displays several navigation icons and items in augmented reality.
In addition, when the mark has been made, its location is checked by the tool to validate the operation. Interactivity with the hands-free technology is provided via voice recognition.
Engineers at Ford Motor Co.’s assembly plant in Valencia, Spain, have developed a wearable device that enables operators to make faster and more accurate quality checks.
Previously, assemblers used a paper-based system that involved walking back and forth to access information on desktop PCs. Now, using a wrist-worn quality assurance device, specification and quality checks can be made on the spot.
“The ability to simply consult a smartphone screen to check any aspect of a vehicle’s quality helps improve work processes and manufacturing efficiency,” says Linda Cash, vice president of manufacturing at Ford of Europe.
“The new system has helped reduce human error by 7 percent, while at the same time making each vehicle check seven seconds quicker,” claims Cash. “This represents a substantial time saving that allows additional quality inspections.”
In the United States, several prominent manufacturers are deploying wearable devices on their assembly lines. For instance, Boeing has used Google Glass technology to improve wiring harness assembly applications. At its oxygen sensor plant in Anderson, SC, Bosch has equipped assemblers with smartwatches.
Deere & Co. is currently conducting tests at several of its plants. Applications are focusing on how wearables can improve the efficiency and productivity of assemblers by reducing errors, improving safety and boosting quality.
Assembly professionals are also busy deploying other cutting-edge tools, such as 3D printers and collaborative robots.
Additive manufacturing continues to move beyond traditional prototyping applications and into low-volume production. More than one-third (37 percent) of State of the Profession respondents plan to use 3D printing technology during the next 12 months. That’s a 7 percentage point increase over 2015.
Interest is strongest in the medical equipment (56 percent), transportation equipment (55 percent), computer and electronics (53 percent) and aerospace (52 percent) industries.
“Digital technology is transforming manufacturing processes across the entire product life cycle,” says John Dulchinos, vice president of digital manufacturing at Jabil Circuit Inc. “3D printing is an important pillar of [our] digital strategy.”
According to Dulchinos, the former president and CEO of robotics pioneer Adept Technology Inc., the factory floor of the future will also be smarter than in the past. He believes collaborative robots will enable manufacturers to tackle many high-mix production challenges that were impossible in the past.
The next-generation machines equipped with state-of-the-art sensor technology allow robots to operate side-by-side with humans on assembly lines. There’s no need for traditional safety barriers and protective cages.
More than one-quarter (26 percent) of State of the Profession respondents expect to deploy collaborative robotic technology during the next 12 months.
One-half (51 percent) of manufacturers in the transportation equipment sector plan to follow the lead of Audi, Brose and other companies and invest in the machines. Other industries eager to allow humans and robots to work in close proximity on assembly lines include fabricated metal products (42 percent), computer and electronic products (37 percent) and contract manufacturers (35 percent).
Large manufacturers (54 percent) are more likely to deploy collaborative robotic technology vs. only 43 percent of small manufacturers.

About the Industries

Participants in the 2016 State of the Profession survey were comprised of the following industry segments, based on the North American Industry Classification System:
Aerospace: includes airplanes, helicopters, jet engines, missiles, rockets and satellites.
Computer and Electronic Products: includes antennas, audiovisual equipment, automatic teller machines, clocks, computers and peripherals, connectors, digital cameras, flat-panel displays, loaboratory instruments, loudspeakers, navigational instruments, printed circuit boards, process control instruments, railroad signaling equipment, semiconductors, smoke detectors, stereos, telephone apparatus, televisions, test and inspection equipment, transmitters, video recorders and watches.
Contract Manufacturing: includes third-party companies that manufacture components, subassemblies or complete products for other companies.
Electrical Equipment and Appliances: includes batteries, flashlights, generators, household appliances, industrial controls, lamp bulbs, lighting fixtures and equipment, motors, switches and transformers.
Fabricated Metal Products: includes ammunition, cans and containers, cutlery, doors, fences, firearms, hand tools, hinges, ladders, locks, metal stampings, plumbing fixtures, prefabricated buildings, springs, valves and windows.
Machinery Manufacturing: includes agricultural equipment, construction equipment, conveyors, food processing machinery, lawn and garden equipment, machine tools, office machines, packaging machinery, photographic equipment, printing presses, power tools, pumps and compressors, refrigeration and heating equipment, textile machinery, vending machines and welding equipment.
Medical Equipment and Supplies: includes diagnostic equipment, orthopedic and prosthetic appliances, and surgical instruments.
Plastics and Rubber Products: includes belts, bottles, floor coverings, hoses, packaging materials, pipes and fittings, plumbing fixtures and tires.
Transportation Equipment: includes automobiles and automotive components, boats, engines, motor homes, railroad locomotives and rolling stock, recreational vehicles, ships, trailers and trucks.