Our family business, Neilsen Manufacturing Inc. (NMI), opened in Salem in 1957. Since then, we have built a reputation for excellence by offering family wage jobs, good benefits, training programs, a world class facility,  and cutting edge technology and processes. NMI and our employees have consistently been good citizens, participating in, and financially supporting local charitable organizations and efforts.

This week I announced to these good employees that by next spring we would be eliminating 125 positions, about 70 percent of our work force. Headlines announcing plant closings, downsizing, restructuring or layoffs are not uncommon. Oregon and the Northwest have been especially hard hit by these changes. When these headlines are about your own business, the sadness is profound. Our company’s success has been built by employees who are losing their jobs.

For nearly 50 years we have worked hard to build NMI into the locally owned good citizen business that it is. Over the years we have changed our focus as markets have changed. But we have always grown.

But now is different. We believe the market forces and global trends that are creating our reality today are just beginning. You and I, along with all consumers are the reason.

Why would any of us pay $200 for a US manufactured DVD when we can buy the same Chinese-made product for $29? And as you know it isn’t just DVD’s. In fact most of us are convinced that no matter what the item is we can probably search on the internet and buy it cheaper somewhere. This focus on price by consumers drives manufacturing.

Right now the talk is about China being the low cost center, but countries are lining up to be next, with an increasingly skilled workforce that will keep this lower and lower cost manufacturing cycle going. Andrew Stern, president of the Service Employees International Union has remarked, “We are living through the most profound transformative economic revolution in world history as we go from a manufacturing to a service-and-information economy and from a local and national economy to an international economy.”  

The implications for manufacturers such as NMI are sweeping. Our Board of Directors has concluded that medium-sized manufacturers will go through a transition as medium-sized family farms did.

In agriculture, conglomerates consolidated available acreage into large agri-business empires that included farms in many corners of the globe. The owners of local farms sold out, went out of business or changed. Those that survived, developed highly specialized, nimble operations. Because of the conglomerates, what used to be seasonal is now available from somewhere all year long. Because of today’s family farms, we also see specialty products that are local – fresh blueberries, heirloom tomatoes, organic produce

We at NMI need to make the transition that today’s family farms have made and systematically re-invent our company. The challenge we face is to get back to our roots to create a small, responsive, organization. As we meet this challenge, we will remember the values  that have made Neilsen Manufacturing a vital  part of our community.

Submitted by:

Tom Neilsen, NMI Chairman of the Board