QBR: Quad/Graphics closure shows workers' needs for training

Quad/Graphics announced June 18 that it would close operations at its St. Cloud plant in late August. The plant, originally opened in 1938 as Volkmuth Printing, had been acquired by Quad/Graphics as part of the bankruptcy sale of World Color (previously Quebecor World) in 2010. The plant had 450 workers at the time of the World Color bankruptcy in 2008, 360 workers when Quad/Graphics bought it two years later, and 280 workers when Quad/Graphics announced its closing. Even at that size, it was the second-largest printing company in the region that as recently as 2000 had 40 printing firms with more than 3,000 employees.

On Aug. 1, the University of Minnesota Extension Service, St. Cloud State University School of Public Affairs Research Institute, and the Stearns-Benton Employment and Training Council, with cooperation from the Greater St. Cloud Development Corp., provided the St. Cloud community with information about the impact of this closing. The analysis did not try to study details of Quad/Graphics' operations but used news reports, average industry data and public statements to infer the size of the firm.

The analysis showed that the total impact of the closing of a printing firm the size of Quad/Graphics would be the loss of 475 jobs, $24.6 million in labor income and $72.7 million in lost output to the area economy. This is about 0.5 percent of area employment, 0.4 percent of labor income, and 0.9 percent of area output. This means that the closing of a printing plant of Quad/Graphics' size would mean 83 jobs would be lost through less business volume for area firms that did business with the plant, and another 112 jobs lost because those workers at Quad/Graphics would lose income. Warehousing would be an example of the former type of spillover effect from Quad/Graphics' closing; food and service industry jobs would be an example of the latter.

SBETC provided information on a survey done by the Minnesota Department of Employment and Economic Development of Quad/Graphics workers. More than 70 percent of workers participated in the survey. This produced some very interesting results about these workers:

• This was a very mature and experienced workforce, with 100 workers reporting 25 or more years with the firm and 99 workers age 50 or older. Many requested help with interviewing, networking and job application skills, perhaps because they had not looked for work in many years.

• There were 22 workers who reported earning overtime recently. Quad/Graphics was not closed due to lack of work but due to the purchaser looking for cost savings.

• Most displaced workers wanted full-time employment. Only five already had found another job, and another five had decided to retire or leave the workforce. A relatively small handful was interested in self-employment.

• Of these, 70 workers were willing to attend full-time training, and another 50 part-time. Many require income while training such that they would work part-time and train part-time (82 reported they only wanted training programs of fewer than six months). Yet 53 did not know whether training would be helpful to them. While they recognize that they need job skills — particularly computer skills — many also said they needed career counseling.

Among the interesting comments made at the public meeting, it was clear that while Quad/Graphics wanted to retain its workers until the plant had fully closed in August, the company was nevertheless approached by area employers to learn about access to displaced workers. So, as indicated in the responses to this quarter's St. Cloud Area Business Outlook Survey, area firms are actively trying to recruit employees (and are paying higher wages, salaries and benefits) in an attempt to address the local shortage of qualified workers.

Training issues may be the greater impediment. Many workers do not know what skills are needed; others may be concerned that the skills they invest in will become obsolete quickly in a rapidly changing economy. A graphic designer older than age 50 was most likely trained for print; nowadays they will need to be able to design for the Web, but even there the skills needed are constantly changing. A split schedule that gives the worker 20 hours of training a week, for example, might not work for an employer who has needs for 40 hours of work each week. The job shortage story is real, and along with it will come creative solutions to meet the needs of both workers and firms.[1]

[1] Subsequent to the Aug. 1 public meeting, Stearns Benton Employment and Training Council announced it had received a $604,500 grant from the rapid response program at Minnesota DEED to help train displaced Quad/Graphics workers over the next two years.