Berkshire Business Outlook: Flexibility gives plastics industry strong future
The area is home to 13 plastics manufacturers and about 25 associated businesses: mold-making, engineering, technology and tool makers.
Plastics' proliferation has some people scratching their heads and asking: How'd they do it?
The reason for the local concentration of plastics businesses can be boiled down to three words: GE was here.
General Electric left more — and something a whole lot better — than a plume of unmitigated pollution when the corporation ended its Pittsfield operations: GE also left behind a buzzing local plastics industry.
"If, like GE, you make plastic materials here and you mold plastic materials here, then there's an industry that builds up around it for tool-makers and other related businesses," said Terry J. Minnick, chairman of Molding Business Services Inc. in Florence, and an excellent resource for local manufacturing history.
"New England was this real hot bed of the plastics industry all the way from the late 1800s up into the '60s and '70s," Minnick said.
The industry hit the skids when outsourcing to find cheaper labor and relocating for better power and tax rates were all the rage. Berkshire County's plastics industry was saved by the state's health, medicine, and hi-tech sectors. What the area couldn't provide in discounts, it made up for with specialized skill.
"The boom of medical and some specialty items in New England made the industry steady and robust again," Minnick said.
GE's manufacturing operations began in Pittsfield in 1903 when it purchased the Stanley Electric Manufacturing Co., which had set up shop in the city in 1890. GE began laboratory works on plastic in 1909 at its Pittsfield plant in the Morningside neighborhood. By the late 1920s GE's Pittsfield plant was manufacturing half of the country's plastic molded bases for vacuum radio tubes. But GE's plastic business in Pittsfield really took off in 1955 when Daniel W. Fox invented Lexan, the first engineered plastic, which was strong and durable enough to replace metal. Lexan became the core of GE's plastics business, which peaked in 1988 with $5 billion in revenues.
GE's power transformer division in Pittsfield experienced growth in the 1930s as the company became the region's largest employer. In 1943, the total number of employees at GE's Pittsfield facilities peaked at 13,645.
With the corporation's buying power, cutting edge research and development, a host of plastics manufacturing-related businesses were founded locally. Meanwhile, some GE employees left the company to start their own plastics businesses.
"That was kind of the genesis of this industry, where it all got started for many of us in Berkshire County," said Rick Stover, president of Custom Extrusion Inc., in Sheffield. "In [the post] World War II era, there were a lot of entrepreneurs like [my father] that spawned out of plastics."
Custom Extrusion was founded in 1957 by Stover's father, Harold "Smokey" Stover, in proximity to General Electric so that the company could have "access to technical advances in the industry."
The company's story is similar to many in the local industry: Custom Extrusion grew up alongside GE and changed with the times, focusing more on highly-skilled or "advanced" manufacturing. For the first 20 years, Custom Extrusion made lighting fixtures. The company has stayed profitable, Stover said, by evolving into a one-stop shop for plastics manufacturing needs, which includes printing, punching, cutting, coloring and just about anything else that a product may need to be completed.
The skill set established and businesses grown due to GE's presence are, in many ways, what is keeping the industry alive in the area today. Amid major worker strikes and a shift in the company's corporate mission, GE winnowed down operations in Pittsfield, employing just 3,600 by the 1990s. GE sold its plastics division and Pittsfield campus to Sabic Innovations Plastic in 2007 for $11.6 billion. Sabic moved most of its Pittsfield operations to Houston in 2016, although it still maintains a small presence at Building 100 on GE's former manufacturing campus in Pittsfield.
While GE was here, the area created educational programs to support factory workers. McCann Technical School in North Adams and Taconic High School in Pittsfield have reputations for preparing students for manufacturing work.
The plastics industry has declined some, as almost all manufacturing in the U.S. has, but the Berkshire County plastics industry has seen a slow, even decline. From 2001 to 2016, the number of local plastics businesses has dropped by 32 percent. Paper has suffered worse in the Berkshires, losing 53 percent of local businesses over that same time period, according to the U.S. Bureau of Labor Statistics. The region's machinery manufacturing businesses have declined by 39 percent.
And local plastics are facing some challenges that are staring many business owners in the eyes: retirement. Many of the plastics businesses that remain are headed by many longtime entrepreneurs who kept their businesses here because they love living in the Berkshires. Other plastics companies have relocated down south to save on the cost of energy and labor, moved overseas or closed.
Some of the plastics businesses will find new owners, but the struggle to attract engineers to the Berkshires and finding local skilled workers isn't much easier.
"We're very specialized, but that doesn't insulate you completely from the ups and downs of the market," Stover said. "The name of the game is to increase your capabilities and your skill set so that you can bring something unique to the marketplace."
Kristin Palpini can be reached at email@example.com, @kristinpalpini on Twitter, and (413) 629-4621.
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