Olympia Business Watch

Where will Boeing assemble 737 MAX?

The lead from the Puget Sound Business Journal said it all:

"For Washingtonians, the good news is that Boeing’s planned re-engined 737 MAX is an instant hit, having received “commitments” for 496 aircraft from five major airlines. The bad news is that the aircraft’s popularity could boost total 737 production up to 60 a month in the next 10 years. That could max out the capacity of Boeing’s (NYSE: BA) plant in Renton, Wash., where 737s now are made."

According to reports in The Herald, Everett, Boeing said its board had approved a plan to put newer, more fuel-efficient engines on its popular 737. The move comes eight months after Airbus launched its A320 New Engine Option aircraft, or A320neo. Airbus has more than 1,200 orders for its updated single-aisle jet. 

Boeing plans to deliver the first 737 MAX in 2017. Airbus' first A320neo will be delivered in late 2015.

Boeing believes its updated 737 will be 16 percent more fuel-efficient than the A320s already in service. Compared with the A320neo, Boeing's 737 MAX will be 4 percent more fuel-efficient.  On a cost-per-seat basis, Boeing said its 737 Max 8 will save carriers 7 percent compared to the A320neo — the Boeing jet should seat a few more passengers than Airbus.

The single-aisle jet market is an important one to both Boeing and Airbus, as challengers are lining up to break into a market that Boeing estimates will be worth nearly $2 trillion during the next 20 years. That is a market Chinese, Brazilian and Canadian airplane manufacturers also want a piece of. 

Boeing is increasing production on its existing version of the 737 at its Renton facility with plans to reach a pace of 42 aircraft monthly in 2014. The company plans to continue to build the 737 even after it begins deliveries of the 737 MAX.

In the next six to eight months, the company will pick a site for the 737 MAX “based on what's best for the company and what's best for our customers,” Jim Albaugh, president of commercial airplanes, said. But “certainly Renton is at the top of the list.”  

Let's hope so!  Production costs and the potential for work stoppages will be key determining factors.

Don C. Brunell, President (DonB@awb.org)

Brunell: Americans can learn from Poland's past

Poland is a bright spot in Europe's economy, AWB President Don Brunell writes in his weekly column. It's the only European nation that showed positive economic growth last year, and it's becoming a greater power within the European Union.

Of course, it hasn't always been so vibrant.

Brunell,who recently traveled to the country to assist with Poland Business Week, reflects on the nation's turbulent history,its embrace of all things American, and its success with capitalism.

As Americans become more dependent on a government check, maybe it's time to take stock.

"The changes in our free market system have gradual, but steady," Brunell writes. "Like the lobster in the pot as the water temperature slowly rises, many Americans don't seem to notice nor do they seem to appreciate the value of the entrepreneurial spirit we're losing."

 

Washington job vacancies reach three-year high

This doesn't make sense to me.  If there are jobs waiting, why aren't they filled? 

That's right!  According to a new Employment Security (ESD) Report issued today, there were an estimated 60,087 vacant jobs available in April, an increase of 55 percent from a year earlier and nearly double the number that existed in spring 2009. 

Washington's unemployment rate in July was 9.3% which is .2% higher than the national rate. According to ESD, 321,609 Washingtonians were unemployed which is down 12,000 from last year.

Here is the breakdown of where jobs are available:

• About half of the job vacancies were at companies with fewer than 50 employees, while about one-fourth were at companies with more than 250 employees.
• Of the 60,087 job vacancies reported, 14.7 percent (8,834) were newly created positions, mostly at companies with fewer than 20 employees.
• Over the year, vacancies grew in all major industry groups except the information and utilities industries.  The health care and social assistance industry (10,131), the retail-trade industry (9,502) and the accommodation and food services industry (7,728) had the most vacancies
• Among occupations, the greatest growth was in food preparation and serving; computer and mathematical positions; healthcare; and office and administrative support.
• Geographically, 62 percent of all job vacancies were in the central Puget Sound region of King, Pierce and Snohomish counties.
• 55 percent of open jobs required a high school diploma or had no educational requirement.  The percentage of vacancies requiring advanced education tends to drop in the spring, as seasonal employment increases.

I realize many of these jobs may be entry level and are low paying, but they are jobs and more importantly an entry into the workplace.  That alone should be an incentive to answer that Help Wanted ad and get a job.

Don C. Brunell, President (DonB@awb.org)

 

American Ambassador praises Poland Business Week

Lee Feinstein, American Ambassador to Poland, praised the 90 Polish students and teachers completing the Gdansk Business Week program.  

In his commencement remarks, Feinstein said: "I am honored to be a part of the first Business Week program in Gdansk.  The program has a long and successful history from Washington State, and I am very pleased to see the program expanding here in Poland.  Special thanks to the organizers from Washington Business Week and the Association of Washington Business for their efforts in exporting the program from the U.S. to Poland."

He went on to say: "Trade between America and Poland is bigger than you think, but not nearly enough.  The value of U.S. investments in Poland is $31 billion, and some 360,000 Poles work in jobs generated by U.S. firms.  I hope the size and scope of investments will grow with new investments in renewable clean energy and other sectors."

"U.S. investors are attracted to Poland's continuing growth, its political stability, a strong domestic market, and its culture of entrepreneurship and trade in which American businesses feel at home," the Ambassador stated.

Feinstein concluded: "The overall U.S.-Polish relationship-like the commercial ties-is as strong as ever.  The United States welcomes Poland's leadership in Europe.....Poland's growing influence within the EU corresponds to the deepening and broadening of the relationship with the United States."

"Just last month a PEW poll revealed that 70% of Poles hold a favorable view of the United States, one of the highest rates in Europe.  Statistics like these point the way toward an even stronger relationship between our two countries in the future.  And, more importantly, forward-looking events like the Gdansk Business Week bear out these statistics in a very concrete way and bring our countries closer together."

Business Week began at the Association of Washington Business in 1975. Since it has spread to 26 states, Australia and Poland.  In Washington alone, over 50,000 students and teachers have graduated from Washington Business Week.  For a taste of the "magic of Business Week" see you eight-minute video.

Don C. Brunell, President (DonB@awb.org)

(All photos courtesy of U.S. Embassy in Warsaw and are posted on its website.  See photo album of visit which is on the U.S. Embassy in Poland's website).

 

 

Gdynia/Gdansk....new harbors of free enterprise

Gdynia and Gdansk are twin cities on the eastern Baltic Sea and the sites of two of the three Poland Business Week programs this summer. It is the third year in which Washington business leaders, students and educators have gone to Poland to conduct Washington Business Week and for over 250 Polish students, teachers and business leaders this year, it is a welcome fresh dunk into the creativity and opportunities of America's free enterprise/market-driven way of life.

It hasn't always been that way.  In fact, there were times when Poland was not even recognized as a nation and there were times when people were killed because they were Jews, Christians or dared to engage in free speech or worship---things that we, Americans, have enjoyed since our Declaration of Independence was signed in 1776. 

For example, on Sept. 1, 1939, the German warship Schleswig-Holstein shelled the Polish military outpost, Westerplatte, the fort protecting the entrance to Gdansk waterways.  Gdansk has been a shipbuilding city for centuries and its protected waters are ideal for port operations and shipbuilding. That is what the Nazi's wanted and they took it by force and kept it by harsh occupation. Polish citizens were chased out of their homes and millions of Polish men, women and children were herded into Nazi concentration and death camps.

After the Allied Forces toppled Adolph Hitler, the Polish people continued to suffer under the tyranny of the iron-fisted communist dictators, secret police and undercover informants. Communist leaders as part of the Soviet Bloc, suppressed freedoms, impoverished people and starved families. Party leaders were generously rewarded, but the majority of the Polish people were impoverished.  The Communists controlled everything and including production.  Store shelves were empty as shown in this display at the museum next to the Gdansk Shipyards where the August 1980 uprising signalled the beginning of the end of Soviet Bloc.

Today, Poland is the only nation in Europe experiencing positive GDP growth and people are excited about the freedoms which are barely three decades old. Walking through the streets of Gdansk, Gydnia and Warsaw and you see the markets doing a brisk business, people shopping and eating, and villages, towns and cities thriving.  It is a welcome sight.

During my 12 hour flight back to Seattle from Warsaw, I wondered if people in America really understand and value the opportunities we've had for centuries. At times, it really doesn't seem that we do. 

I also realized Poland is emerging as a valued business partner.  The Polish and American people have been friends for a long, long time.  Increasingly, we will be partners in progress and growth.  In the future, that will serve both of our nations and citizens well.

This ends the Poland postings.  The Association of Washington Business is proud to be the founding sponsor of Washington Business Week and it is gratifying for us that business and education leaders had the foresight to create this program in 1976.

Don C. Brunell, President (DonB@awb.org)

Brunell: Boeing's prospects are bright ... for now

Amid all the bad economic news of late, Boeing has supplied some welcome good news, AWB President Don Brunell writes in his weekly column.

The company has completed flights tests of its long-delayed 787 Dreamliner, and despite the delays the 787 remains in strong demand. Boeing Commercial Airplanes Chief Jim Albaugh says there are 830 orders for the 787 from 52 customers, and the plane is sold out through 2019.

Boeing is adding workers and Arun Raha, the state's chief economist, expects hiring to continue for the next couple of years.

So, thing are looking up -- but all that could change, Brunell says.

He cites the National Labor Relations Board claims against Boeing over its decision to build a second production line right-to-work South Carolina, and competition from manufacturers in China, Brazil and Canada -- in addition to rival Airbus -- as notable challenges facing Boeing.

"To survive in this aggressive global marketplace, Boeing needs certainty and stability at home, with its workforce and with government regulators," Brunell writes. "Without it, Boeing's future prospects are uncertain."

 

Business Week's European exposure

As Poland's Business Week program enters its final week in the Gdynia-Gdansk area, educators from Denmark and Italy have visited or have participated in the program. 

In Gdansk, school officials from Florence and the northern reaches of rural Denmark spent two days and participated in the trade show judging.  They headed home with the blueprints of the Business Week program. This week, four educators from Denmark are in Gdynia participating in Poland Business Week.

Jon Doll, a consultant with United Way Worldwide stationed in London, flew into to Gdansk to speak and be master of ceremonies for the talent show. Doll is from Seattle who worked with the Bon Marche and United Way in King County.

Business Week is also drawing speakers from around Poland.  For example, Michal Jaworski, Micrsoft; Adam Bergmann, Bergmann Associates; and, United States Ambassador to Poland, Lee Feinstein, flew in from Warsaw to address the students (more about the Ambassador's visit and remarks in an upcoming blog).

The point is after three years in Poland, the Business Week program, hatched at the Association of Washington Business in 1976, is drawing international attention.  In the end, 250 Polish students and teachers from the Gdansk-Gdynia region will have graduated from Business Week.  They will join the more the 50,000 Business Week alumni from the Washington program who have fanned out across the United States and world.

Don C. Brunell,  President (DonB@awb.org)

Thumbs up for Poland Business Week

With week two of Poland Business Week drawing to an end, here is what the adult student advisers, called company advisers or CAs have to say.  They give it a big thumbs up!

Beata Kozlowska, Boeing Seattle, said she was glad to be back in her native Poland.  She transferred from the Warsaw office last year and was a company adviser in Gdynia in 2010.  "I really appreciate the students in my company. "They were wonderful and I want to say a big thank you to Janice and Allen Jaworski.  They really are dedicated to this program and make it work!"

Fred McDonald teaches accounting at Central Washington University and is senior CA in Poland.  He became a company adviser in 2000 and has been a CA at the Poland program since it was started in 2009.  Fred moves on to Poland Business Week number three at Gdynia next week.  "This is such a pleasure being with the students.  I would not miss it for the world!"

Darby Vigus teaches business at Monroe High School and, like Fred, has attended all three years' Business Week programs in Poland.  "The personal transformatino that occurs in each individual student is magnified by their language acquistion and cultural norms.  It surpasses Washington Business Week.  Truly, it has sparked a tremendous passion in my life."

Carey Doyle teaches middle school math and science at Shahala Middle School, Vancouver.  She was a company adviser at Gonzaga University last year and this is her first trip to Poland."Business Week is the best kept secret in Europe.  Not only do the students think globally about business, but they learn about one another.  I love my students and our Polish teachers who were our partners all week."

Martin Gunnell works for Boeing in Long Beach, CA, and teaches in a Ph.D program at Phoenix University.  "This week has been an experience of forging new relationships and bridging cultural differences."

Keith Nida works in marketing for Boeing in Seattle. This was his second time as a company adviser and first time in the Poland program.  "These kids were simply awesome and Gdansk is a beautiful spot for the program!"

Sarah Cabezas is from Boeing in the Seattle area as well.  "The program is exhausting, but it is well work the support of Boeing and other sponsors.  I'm happy the Association of Washington Business started this program and I'm proud Boeing is a sponsor and helps people like me attend!

Eliot Brimage works for Josten, the company which makes high school graduation rings.  He lives in Puyallup and like the other veteran company advisers really gets into the program with the students.  "They are great and Business Week, whether it is in Poland, Alaska or Washington, is a great program.  There is nothing like it anywhere and I really love the week I spend with the students. It is hard to say goodbye!"

Business Week is a WINNER!

Double Auction Economics Theory?

Ever since people started bartering, curious folks tried to figure out why people would trade or purchase something whether it be a dozen eggs or a Boeing 747.  Retailers and marketers spend billions each year on marketing research just to learn why you buy, when you purchase, and how much you will pay.

People even win Nobel Prizes for this work.  One such winner is Dr. Vernon Smith from Chapman University.  Dr. Smith co-won the prize for his work in experimental economics in 2002. Experimental economics is way of studying how people make decisions in markets and their everyday lives.

Eric Kimbrough (top photo) and Taylor Jaworski got hooked on experimental economics after taking a class from Dr. Smith as undergraduates. Kimbrough has a Ph.D in economics and is a professor at Simon Fraser University outside of Vancouver, B.C., while Jaworski, son of Poland Business Week coordinators Allen and Janice Jaworski, is completing his Ph.D in economics at the University of Arizona, in Tucson. 

Kimbrough and Jaworski came to Gdansk for the second session of Poland Business Week and they put students through an experimental economics exercise to determine their buying habits.  They set up a market for the double auction.  It was an addendum to the traditional Business Week program and it was a fun exercise.

Poland Business Week is in its third year.  It is an extension of Washington Business Week which was created at the Association of Washington Business in 1976.  This year there are three sessions in Poland during August.

Don C. Brunell, President (DonB@awb.org)

It's a matter of courtesy and respect

Meeting presenters complaint about it!

People chairing meetings complain about it!

Even your pastor at church complains about it!

It is texting, cellphones buzzing with text messages,or mobil phones going off with catchy tunes and people outright taking cellphone calls when they should be listening or at least extending some courtesy.

Which brings me to my point.  At Business Week in the U.S., the number one complaint of company advisers over the last five years is texting or taking cellphone calls during company meetings or when speakers are presenting. It gets to the point where you have to draw a hard line in the sand--several times. 

STOP!  NO MORE!

I am happy to report that at Gdansk, we asked the Polish students to holster their cellphones during company meetings or when speakers were presenting. No texting either.  

We only had to say it once at the beginning of the week, and they did as they were requested.  The world didn't come to an end and human kind didn't disappear as we know it because someone couldn't take a call or text or respond!  How refreshing.

Maybe Americans can learn from the Polish students.  Afterall, it is a matter of courtesy and respect.

Don C. Brunell, President (DonB@AWB.org) 

P.S.  Polish intern Wiktor Podlowski was not in a meeting or presentation. He was working in the office solving problems which is exactly what mobile devices are intended to do.