Walorski Shares Feedback From Hoosier Businesses Impacted by Tariffs at Ways and Means Hearing

Last week, Congresswoman Jackie Walorski (IN-02) shared feedback from Hoosier businesses affected by steel and aluminum tariffs at a House Ways and Means Committee hearing on the impact of tariffs on the U.S. economy and jobs.

“Historic tax cuts and regulatory reforms have revived America’s economy, but I am constantly hearing from businesses in northern Indiana that steel and aluminum tariffs are driving up costs and making it more difficult for them to grow and create jobs,” Walorski said after the hearing.

“The administration has taken steps to narrow these tariffs to better target unfair trade, but more must be done to protect businesses and jobs here at home. I will continue listening to Hoosier manufacturers, farmers and workers, and making sure their voices are heard so we can keep our economic momentum going.”

Video of Walorski sharing local businesses’ feedback at the hearing:

She read the following quotes from Hoosier job creators in a wide range of industries:

• (We’ve seen) a 50% increase (in the price of steel), mostly since the tariffs were announced. Additionally, there is a shortage of steel. We are furloughing the production line in (one facility) today and will probably have to furlough some of the guys in (our main facility) later in the week due to lack of availability of material. We have raised prices to our customers but because (our product is) a low margin item – the combination of the increase and the lack of availability is affecting sales.”

• “We cannot switch to a U.S. source, and it would take 1 to 2 years for us to get approval from our customers if there was a U.S. source. We will continue to import steel and will pay the duties. So far we have incurred about $15,000 in tariff costs with a potential of another $240,000 based upon the orders we have already booked with (our) Japanese steel supplier. We are moving forward with our exclusion requests; so far the cost has been close to 100 hours to complete these exemption forms along with some legal costs for review and advice.”

• “We have rolling shortages of steel and we are on allocation (from our supplier in Utah) … Prices had already gone up 25% and 30% respectively (on aluminum and steel) because of speculation. Now we are seeing a trend past 30-35% each. Of course, I am livid.”

• “We observed steel prices starting to move up in early 2017 on just the talk of potential steel tariffs and a sharp escalation in steel prices in the last 3 months as the tariffs started to become a reality. This has resulted in a 15% to 29% increase in the cost of our steel. To put this in perspective, our increase in steel cost is larger than the entire cost of providing health insurance to our workforce.”

• “We are the sole manufacturer left in the United States that manufactures this type of product. Our competitors import all or most of their finished product from either Mexico, China, Vietnam, etc., therefore avoiding any impact of this tariff…The bottom line is this, if you raise our steel and aluminum prices, our prices will have to increase in order to cover the cost. Our foreign competitors will not be affected. … We currently purchase all our steel and aluminum from domestic sources.”

• “We are in the process of trying to build a 147,000-square-foot warehouse. (The company building the warehouse) gets their steel from Canada, a country exempted from the steel tariff. However, we are unable to get a firm quote even out of Canada, because prices are beginning to rise there with so much demand shifted to Canada. It is not on hold – we have to build it – so we are at the mercy of a volatile market.”

• “When purchasing raw materials, we give preference to domestic steel mills wherever possible. We enjoy long, outstanding relationships with many domestic mills. We want them to thrive. … The actual dynamics of the entire metalworking market have evolved in the last 40 years. … In some cases, we find that domestic mills cannot meet the quality standards required by our customers; or they cannot meet the quality standards at a competitive cost. In those cases, we will buy foreign material. … Why put a tariff on these items?”

Alcoa Warrick Earns Global Honor for Commitment to Safety, Environment

Alcoa's Warrick Operations has been in Newburgh for over 50 years, and was just honored for its commitment to safety at its corporate headquarters in Pittsburgh. For more information on that achievement, see below. And for more on this impressive employer in southwestern Indiana, read this 2011 BizVoice article about the company. Odds are if you ever drink from an aluminum can, Alcoa has played a role in your life.

Alcoa's top leaders, including Alcoa Chairman and CEO Klaus Kleinfeld, congratulated employees from Alcoa Warrick Operations during the corporation's annual leadership conference in Pittsburgh. The event also commemorated the corporation's 125th anniversary.

Warrick Operations won the corporation's global award in the category of Environmental, Health and Safety (EHS) during the March 18 awards program.

In 2012, Alcoa Warrick Operations had its best-ever safety performance: The OSHA recordable rate for the sprawling facility, which employs nearly 2,000, finished the year at 1.23. That result is significantly lower than the U.S. Department of Labor's reported rate of 3.8 for all businesses, including government.

The OSHA Recordable Injury Rate is determined by multiplying the number of recordable injuries by 200,000 and then dividing by total work hours. A recordable injury can range from minor injuries such as muscle strain/sprain or an injury that could result in lost work time. There were no lost workday injuries at Warrick Operations in 2012.

"This strong safety performance happened through the collective effort of our workforce — employees who consistently focus on working safely, watching out for each other, and using proven and robust safety systems and tools," said Ed Hemmersbach, the V.P. of Alcoa Global Packaging. "It's excellent to receive this level of recognition from the highest levels of our corporation, and we'll continue to share safety best practices with our manufacturing peers here in the Tri-State."

At Warrick Operations, safety processes are ingrained in the culture, which includes daily toolbox meetings and pre-task reviews. During pre-task reviews, employees complete a safety evaluation before specific tasks are started. Also, employees are authorized to stop any job if they observe an unsafe condition. Safety takes priority over profit or production. In fact, employees are recognized when they identify an unsafe condition and take action to correct it.

Royce Haws, the Location Manager for Alcoa Primary Metals, said employees are ever-vigilant in identifying and then eliminating safety risks.

"We're proud of this safety achievement," Haws said, "but we also know that one injury, no matter how small, is one too many. So we continue to improve and not rest on previous accomplishments, including this one.

"Importantly, our employees know that it's possible to have zero injuries, and that's our goal every year," Haws said.