The technology sector and several other segments of Orange County’s diverse manufacturing base are showing signs of improvement as the traditional big hitters of the aerospace and defense industries continue to slash jobs.
Several of the county’s sizeable segments—medical device makers, apparel makers, chipmakers and clean technology companies, among others—are leading the way.
Their gains haven’t pushed overall manufacturing into positive territory on hiring but they signal bright spots in a mixed recovery.
Job gains in the last year were seen among automakers, software companies, computer products makers, apparel makers and medical device makers. Old-line manufacturers, such as metal fabricators and tool-and-die makers, ap-pear to be joining the trend, according to recent data from the state’s Employment Development Department.
Bankers from San Fran-cisco-based Wells Fargo & Co. who are talking with manufacturers daily and seeing more demand for equipment financing, said Alan Epperson, who heads the bank’s OC business banking division.
“We have some companies that are in that industry that are doing really well,” said Epperson, who noted lending to manufacturers has about doubled in the past year.
That dovetails with Chapman Univer-sity’s Orange County composite index for manufacturing in the second quarter, which increased to 65.3 compared to 61 in the first quarter.
Results of the index are based on surveys filled out by manufacturers in the county. Any number above 50 signals expansion.
Inventory is expected to increase “substantially” for durable and nondurable goods in the second quarter, according to the latest index.
“High-tech is the one that is showing much better growth,” said Esmael Adibi, director of the Anderson Center for Economic Research at Chapman.
Chapman’s index and anecdotal evidence point to an ongoing rebound after a drop in consumer and corporate spending during the recession that hit the sector hard.
148,700 Workers
Manufacturers here employed 148,700 people through May, down 1.5% from a year earlier, according to the Employment Development Department.
Aerospace products and parts makers drove the losses, accounting for a cut of 700 jobs during the same period, a 7% dip.
This week’s Business Journal list shows that the largest defense and aerospace contractors here combined for a decline of 5.4% to 22,865 jobs for the past 12 months.
Big players such as Chicago-based Boeing Co. and Parker Aerospace in Irvine have cut hundreds of jobs in the last year amid production lulls, federal spending cuts and a military shift away from big ticket items (see related story, page 9).
The shifts in aerospace and defense indicate total employment in manufacturing hasn’t risen even as overall production appears to be on the rebound.
Chapman’s index, a sort of a localized version of the one compiled by the national Institute of Supply Management, marked the eighth-straight month of manufacturing production growth.
Chipmakers started to rebound on hiring last year, when the Business Journal’s annual list showed the 20 largest based here accounted for a 7% increase in employment, pushing the sector’s total to about 4,700.
That reversed a 3% cut in jobs among the largest chipmakers here a year prior.
Likewise, the 20 largest software companies employed about 7,700 workers here through May, up nearly 3% from a year ago.
The same goes for the biggest medical device makers here, which combined for a 6% gain on last year’s list. That followed a 10% decline the year prior.
Meanwhile, Seal Beach-based Amonix Inc. has added jobs amid the push for green products and technology. The company makes solar panels to generate energy in sunny, dry climates and nearly doubled its local employee count to 153 people in the past year to meet growing demand, according to Carla Pihowich, vice president of marketing and regulatory operations.
Other gains are coming from manufacturers with headquarters or operations that employ executive, marketing and administrative employees here to support factories in other states or countries.
Anaheim-based luxury hybrid auto-maker Fisker Automotive Inc. has quadrupled its local workforce to 200 employees since January 2010 and plans to fill another 100 positions here by the end of this year as it rolls out its highly touted luxury sedan Karma.
Fisker also expects its global base of suppliers to hire some 300 workers as it prepares to launch its second model, the mid-range Nina sedan. Positions include engineers, electro-mechanical technicians and production workers.
Fisker recently moved its headquarters to a 156,135-square-foot Anaheim building on East La Palma Avenue, near the Riverside (91) Freeway.
A mix of logistics and quality-of-life factors kept Fisker here when it outgrew a lease in Irvine.
“Anaheim provides a favorable business environment for our growth and also has the infrastructure and access to the freeways and airports that we need,” said spokesman Roger Ormisher. “In addition, it’s a great place for our staff to live.”
The raft of other automakers—Hyundai Motor America Inc. and others with U.S. headquarters or operations here—reported a 4.3% increase in workers to nearly 3,000 people in the 12 months through March, according the Business Journal list on the industry.
That reversed three straight years of cuts.
The biggest apparel manufacturers here—a group that ranges from surf-inspired labels and edgy urban designs to high-end women’s wear—reported a nearly 5% increase in employment to 9,853 workers, according a Business Journal list published earlier this month.
The resumption of apparel hiring follows flat employment among companies last year and an 8% decline in workers in 2009.
Oakley Adds
Foothill Ranch-based sunglasses and clothing maker Oakley Inc. added 444 workers in the last 12 months to 2,110 local employees, up about 27% from a year earlier.
Most of the new hires were for the company’s sunglasses manufacturing.
Huntington Beach-based Quiksilver Inc. saw the second-highest growth in local workers, adding 150 employees, up about 18% from a year earlier.
Most of the additions came through the consolidation of the company’s DC Shoes division, which relocated from Vista to Quiksilver’s Huntington Beach headquarters last summer.
The patchy growth appears poised to take the overall employment picture up for manufacturing by the end of the year. Chapman economists expect a 1% gain for 2011.
It would keep manufacturing on pace to make up about 11% of the 1.35 million non-farm workers in the county as employment improves overall.
Potential Suitors
• MediaNews Group Inc.
Denver-based chain owns Los Angeles Daily News, Long Beach Press-Telegram, Torrance Daily Breeze, San Gabriel Valley Tribune, Pasadena Star-News, Whittier Daily News, Inland Valley Daily Bulletin, San Bernardino Sun and Redlands Daily Facts. New York-based equity investor Alden Global Capital owns the largest share of Freedom, and also holds stakes in MediaNews Group and Tribune Co.
• Tribune Co.
Chicago-based owner of Los Angeles Times likely would see economies of scale with addition of Register. Tribune is in bankruptcy, which likely complicates any acquisition.
• A.H. Belo Corp.
Dallas-based company owns Riverside Press-Enterprise and shares some content with the Register. Former Register executive Ron Redfern is president and publisher of Riverside paper. Belo recently indicated an unwillingness to take on debt to fund acquisitions.
• Platinum Equity
Owner of San Diego Union-Tribune did not respond to request for comment on Freedom or Register. The private equity fund boasts “a long history of creating value by helping established companies navigate difficult market transitions.” The Union-Tribune might be challenge enough for now.
