The results of our energy survey — sent to about 10,000 small and medium manufacturers earlier this month — are finally in. We will parse this info out over the next days and weeks, but the bottom line is the impact on the bottom line. Some 45% of those surveyed said they will be forced to lay off workers or impose wage freezes or wage reductions as a result of the soaring energy prices. This, mind you, while Congress fiddles. There are 420 trillion cubic feet of natural gas in the Outer Continental Shelf, yet we pay the highest natural gas prices in the world. Unbelievable.
Some selected comments from the survey:
“This is a crisis. It’s the worst I’ve seen since we started this company 45 years ago. I don’t think people recognize that this shortage of energy is new to the United States. It’s a seismic market disruption.”
“We make automotive components. The cost of oil and natural gas has increased our price of materials by as much as 93.1% since March 1, 2004. We will have to resort to job cuts, wage freezes and benefit cuts to stay in business.”
“Our paint line ovens and our galvanizing kettle will cost more than double to operate this winter than last. We’re trying to compete with imports that don’t have this pressure. Our freight costs have doubled because of the price of fuel. This is a crisis for manufacturing.”
You get the picture, and it’s a pretty grim one at that. We’ll post a bunch more quotes in the ensuing days and weeks, along with some real-life examples of the impact of the soaring prices of energy.
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