U.S. plastic resin production plants less crowded in 2023 but pay increases likely
Employment in U.S. plastic resin production declined from 60,400 positions in Sep. 2022 to 58,200 in February 2023, according to figures from the Bureau of Labor Statistics republished by the American Chemistry Council.
The number of workers dedicated to produce and market plastic resin, including the top two plastic resin commodities polyethylene and polypropylene, had remained steady at about 60,100 positions in the U.S. in October and November but then fell to 59,500 in December. By January 2023 the number fell again to 58,800, data showed.
The decline in worker positions at plastic resin manufacturing facilities occurred as companies across the plastic resin industry reported profitability challenges in the last quarter of 2022.
Employment figures for resin plants to be published for the second quarter of 2023 may show more declines if payroll cutbacks announced by one of the biggest petrochemical companies in the world, Dow, affect plastics and packaging-related production.
Dow officials have said that employee notifications will take place throughout the year but mostly in the second quarter of 2023. Dow had already made its payroll leaner during the pandemic.
The chemical industry is a provider of high-quality employment for tens of thousands of Americans and its products help in turn support broader employment across industries, according to information on the American Chemistry Council´s website
Other employment-related data republished by the ACC showed an increase in the average hourly wage of workers (including for all chemical as well as all pharmaceutical industry) from $27.80 in Sep. 2022 to $28.90 in March 2023.
Average worked hours fell
The workweek for chemicals & pharmaceuticals averaged 42.3 hours between 2012-2019. It fell sharply during the pandemic and has struggled to return to its pre-pandemic average, data showed.
While the average workweek moved in March to its highest level since July 2021, the number of production workers fell sharply. As a result, the labor input into chemical manufacturing fell, data showed.
GETI Report 2023: pay rises
The petrochemical industry currently faces pressures toward pay increases, according to the recently published Global Energy Talent Index (GETI) 2023 that included a section on petrochemicals.
“Fierce competition from the technology sector, and increasingly diverse roles that combine chemical engineering with artificial intelligence, advanced manufacturing, robotics and consulting have petrochemicals companies offering big bumps in salary talent” to secure and retain talent, said Ujjal Mukherjee, chief technology officer of Lummus Technology, according to the report.
Pay hikes in construction
The petrochemical industry´s capacity to build up new or expanded plastic resin production has been impacted since the pandemic and projects can now be expected to take longer to complete compared with the pre-pandemic period, according to the Associated General Contractors of America (AGC).
Besides projected longer completion times, both construction workers and contractors are earning more, according to the Associated General Contractors of America (AGC).
“Seasonally adjusted average hourly earnings for production and nonsupervisory employees in construction (craft and office) rose 6.6% year over year to $33.82 per hour,” according to a recent report from the association.
“For the seventh-straight month the year-over-year rise in pay topped the 5.1% rise for all private-sector production employees,” according to AGC figures from its April 3-7 report titled “2023 Employment dips in March; job openings remain near February record; hourly, executive pay climb.”
Above average inflation
While employment in plastic resin may be on the decline, the U.S. economy endured above-average inflation for both 2022 (6.5%) and 2021 (7%).
The inflation rate for the past couple of years is about more than double the average for the past 30 years.
According to U.S. Labor Department data published on May 10, 2023, the annual inflation rate for the 12-month period ended in April was 4.9%.
By Renzo Pipoli