The tight employment market in the RV manufacturing capital of the world is about to get a bit tighter.
Mega online retailer Amazon has announced plans to build a huge e-commerce fulfillment center in Elkhart County, Indiana, the home of 80 percent of the nation’s RV manufacturing plants. RV manufacturers are already having a problem finding qualified workers to build their products. Will Amazon make the situation worse?
Luring Amazon to Northern Indiana is apparently an attempt to diversify the local economy, which is by far dependent on the fortunes of RV manufacturing. During the last recession in 2008-2009, the county had the nation’s worst unemployment rate of about 20 percent. Then-President Obama visited the county several times for public appearances to raise the profile of the unemployment crisis. The high unemployment rate was blamed on cuts in the RV industry and the fact that the area was a “one-company town.”
But now, Elkhart County has one of the lowest unemployment rates in the nation, at just 2.8 percent, and RV manufacturers are struggling to find enough workers (qualified or not) to put together their RV products.
More jobs = more strain on workforce
The new Amazon facility would bring in at least 1,000 new jobs to the area, putting even more strain on the local workforce.
Chris Stager, CEO of the Elkhart Economic Development Corporation, said building diverse local businesses has been a goal of his group since experiencing the downside of dependence on a single industry.
“We’re trying to be very respectful of the RV industry because it’s our legacy here, and we’re proud of it. But we do have to diversify and continue focusing on those kinds of things as well,” said Stager in an interview with Inside Indiana Business.
The new Amazon facility will include an 800,000-square-foot e-commerce fulfillment center and a 180,000-square-foot delivery facility. The Amazon facility is slated to open in 2023.
According to Chain Store Age, Amazon workers in fulfillment and transportation receive an average starting wage of more than $18 per hour, and up to $22.50 per hour in some locations. The positions are also eligible for Amazon’s new Career Choice program, in which the company will pay full college tuition for its frontline employees as part of a larger $1.2 billion investment to expand education and skills training for its U.S. workforce.
Can RV manufacturers compete for the precious few qualified workers in the area? If so, will higher wages force them to raise their wholesale RV costs to dealers, further inflating retail prices to consumers?
What this could mean is that RV manufacturers will be hard-pressed to keep their assembly lines rolling at peak levels with trained workers. Elkhart County is already having trouble luring new workers to the area due to housing shortages.