RV execs ponder how to keep growing as labor pool tightens

Companies are finding it difficult to find enough workers here. Might it be necessary to expand elsewhere?

Posted on May 8, 2014 at 5:14 p.m.

These days in the recreational vehicle industry, business is good. Very good.

At some point, might it be too good?

Those attending the second annual RV Power Breakfast Thursday, May 8, were already well aware that the RV industry is booming. Wholesale RV shipments were up 16.4 percent in March over the same month last year — the highest March level since 2007.

Elkhart area manufacturers, suppliers and transport carriers are finding it increasingly difficult to hire enough workers.

Still, some said they were surprised by a statistic delivered early in the event by Richard Coon, president of the Recreation Vehicle Industry Association. Coon said there's a reason it feels "busier" than the last time the industry turned upward, and it stems from the consolidation that's occurred as the biggest firms, such as Elkhart-based Thor Industries and Forest River, have bought up smaller competitors in recent months.

In 1999, 53 percent of the 321,000 RVs made industrywide came from the Elkhart area. This year, 85 percent of the 340,000 units projected to be built will be made locally, based on annualized first-quarter results. That means there could be 289,000 RVs manufactured in the Elkhart area this year, compared to just 170,000 in 1999.

That might not be problematic if the workforce had grown, but on the contrary, it has shrunk — from 97,950 people in 1999 to 94,726 in March, according to U.S. Bureau of Labor Statistics figures. 

At one point during the RV Power Breakfast, a panel of the industry's heavy hitters fielded questions from the crowd. The panel consisted of Forest River's Doug Gaeddert, Thor's Bob Martin, Jayco's Derald Bontrager, Lippert Components' Jason Lippert, Airxcel's Mel Adams and Patrick Industries' Todd Cleveland. 

Sherman Goldenberg, publisher of locally based trade publication RV Business, asked the question likely on many people's minds.

"With the area closing in on zero unemployment, with everyone working who is able or willing to work, how do we prepare for the next round of growth, where do the additional employees come from, or does the industry just expand elsewhere?" Goldenberg said.

None of the panelists said they will be raising pay rates, but several acknowledged the need to create better work environments.

Gaeddert drew an analogy to a football game. It's easier to move the ball down the field than it is when you get to the 2-yard line.

"We're in the red zone. The yardage is tough, we're all going to continue to work well together to get there," Gaeddert said. "As far as moving outside because of the employment issue, if you look back, there is 70, 80 years of culture in this area with this workforce and these people. Pretty tough to go replicate that somewhere, I don't care where it is."

"It's going to be tough. Companies will have to separate themselves and be the best place to work. We're in competition for labor."

Thor's Martin agreed.

"It's amazing to see that we've gone from the highest unemployment rate in the nation, in the recession, to the lowest," Martin said. "We're all struggling to find people. This is where the supplier base is. It would be really hard to move out of the area, so I think the challenge is to bring more people into the area. You do that by creating a great company that people want to work at."

Lippert said workers have higher expectations than they did 20 years ago. About half of his 6,000 employees turn over in a year.

Lippert said the company, which supplies a wide range of components to RV makers, is trying harder to "engage" employees. 

"Instead of looking at, OK, what do we have left in terms of unemployment, it's how do we retain employees?" he said. "As a company we spent a lot of time over the last year working better to engage the front lines, the 80 percent of our workforce. Trying to figure out what we can do to make them stay longer."

Recommended for You

Back to top ^