Downside to growth: Camden’s new wave of companies is struggling to find employees

Holtec’s Singh: ‘If we hire 10, we keep two. The other eight weed themselves out.’

By Anjalee Khemlani
Camden | Sep 12, 2018 at 11:51 am

Krishna “Kris” Singh, the CEO and president of Holtec, has been labeled as one of the saviors of Camden since his company cut the ribbon on a new 600,000-square-foot manufacturing facility that promised hundreds of jobs for local residents.

Holtec joined a wave of companies that took advantage of healthy Economic Development Authority grants to do so, receiving incentives that have the potential to bring the company $260 million in tax breaks.

So far, however, Singh said Holtec has not benefited financially.

Holtec’s Camden facility, which opened recently amid much fanfare.

“This plant is costing us millions right now,” he said.

The reason, Singh said, is simple: Holtec cannot recruit and retain the workforce it needs — despite huge efforts to hire local employees.

The issues range from entitlement to lack of training, Singh said. High turnover is the result.

“We are starting from a base which is zero,” Singh said. “People don’t have the skills.”

They also lack a history of working.

“There is no tradition of work in families,” he said. “That has been a problem. If we hire 10, we keep two. The other eight weed themselves out.”

Singh, a self-made millionaire, is trying to understand it.

“They don’t show up to work,” he said. “They can’t stand getting up in the morning and coming to work every single day. They haven’t done it, and they didn’t see their parents do it. Of course, some of them get into drugs and things. So, it’s difficult.”

The hope is, Singh said, that those that stay become examples in their neighborhoods and encourage more interest.

He’s not the only one to feel this way.

###

European Metal Recycling, known as EMR, is a global leader. It also recently opened its plant in Camden, after looking at other options, including New Orleans.

The company recycles cars and car parts, processing roughly 3,000 cars per month to-date, according to President Joe Balzano.

That is, if it can find people to do the work.

“It’s not easy,” Balzano said. “I think it’s hard to attract people. It’s not glamorous work. Getting people to engage is difficult. We have a lot of training that has to go on.”

The payoff, however, is pretty good, Balzano said.

“It is a union facility, so they get probably the best health care in the world, and a pension,” he said. “It’s certainly worth it if they stick it out. But we are going through a turnover. Pretty rapidly.”

Balzano cited the same issue with work culture.

“I think the expectations from an employee to an employer is difficult,” he said. “There’s an expectation that, ‘Well, I came to work today,’ versus the expectation to do something.”

Balzano said the average employee probably makes, including the full package of benefits, about $30 per hour.

###

Politicians are aware of the problem.

U.S. Rep. Donald Norcross (D-N.J.) said it’s a problem he has focused on for more than a decade as the business agent for the International Brotherhood of Electrical Workers Local 351.

Changing the culture, Norcross said, will not be easy.

“When you stop to think about it, I say children are that one asset that you can’t blame them for anything,” he said. “Same thing goes for people who have not had a structure that taught them.

“We saw the same thing (with the union) as Dr. Singh and Joe Balzano. There is mentoring that has to take place.”

Norcross admits the city still has its work cut out for it.

“Nobody’s batting 1.000 here,” he said. “But we’re batting a much high percentage (than before).”

Norcross said the city and its companies are working to make change.

“Getting through the door is only part of the issue,” he said. “That’s why EMR has the classes on economics and how to make a budget.

“If you’re in a family that has been on public assistance part and much of your life … you’re not thinking, ‘Am I budgeting so I can retire at the age of 65?’

“When you’ve had generations who have not had those opportunities, you run into those issues. You recognize them, and you start to address them — it’s the only way.”

City officials have said that, despite the struggle, some progress has been made.

A few years ago, many residents were unemployable because they lacked IDs.

Now, they say, it’s a matter of changing the psychology.

###

If Holtec could ship consistently from Camden, rather than Pittsburgh, it would save the company quite a bit of money.

Balzano isn’t ready to give up.

He still thinks Camden has great potential. Its huge population base of approximately 75,000 helps it, he said.

“For us, it’s a good thing,” he said. “The labor force that’s available — we certainly have the pick of it. Including our core business, we will have almost 500 employees in this section of Camden by the end of the year.”

Both Holtec and EMR are working on ways to buoy their business in light of the scarcity of skilled labor.

EMR is focused on developing a structured training program that teaches each person about the steps involved in recycling auto and auto parts.

“Currently, we’re trying to build up our baseline,” Balzano said. “Once we are done with the baseline, then we’ll have training like that built in.”

Singh sees the potential, too.

The hope is, Singh said, that those who stay become beacons of light in their neighborhoods and encourage more interest in the local community.

The potential revenue boost is huge, he said.

Holtec, a company known for its work with carbon-free power generation in commercial nuclear and solar energy, manufactures steel structures at its main plant in Pittsburgh.

These structures get sold around the world. If Singh can grow his operations in Camden, it would be a huge cost-savings strategy.

“This location is ideal for what we do,” he said. “Each steel structure we are shipping from Pittsburgh, if we are shipping from here, it saves $20,000. And we ship about 200 of them every year. The ones that go to Europe get there a week sooner.”

###

Holtec also is actively engaged with the local school district and recruiting from there.

But, at the same time, Singh said, he is working on another plan to help with the labor deficit: automation.

It’s a strategy that other manufacturers have employed and is leading to a STEM-focused future in the industry.

“We’re trying to automate a lot of processes, so it doesn’t rely on human skill, as it has in the past,” Singh said. “Automation is definitely modifying worker needs.

“The high-skilled work that required people to learn and spend tens of thousands of hours to get good, that work can be done by machines. Which is the good news — because we don’t have such workers.

“This plant would be crippled if we relied on workers.”

Read more from ROI-NJ:

Anjalee Khemlani | akhemlani@roi-nj.com | AnjKhem