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Food for thought: food processing is a big slice of utah's manufacturing pie.

Over the last decade, food manufacturing in Utah has grown by leaps and bounds, whether it's large national companies like West Liberty Foods or small, locally owned companies like Chaparro's Tamales. But that growth isn't a surprise to Todd Bingham, president of the Utah Manufacturers Association, who says it can be hard for Utah residents to grasp the amount of food processing and manufacturing companies found across the state.

"Sometimes we think of a narrow segment, but [food manufacturing] covers everything from breweries to candies to artisan foods to organic food production," he says. "It's a very viable economy in Utah."

In fact, Utah is home to more than 325 food manufacturing facilities. Why is Utah such a fruitful place for food manufacturing? There are several different reasons, but the major reason boils down to the state's practically perfect location.

Location, Location, Location

Ed Garrett, president and CEO of West Liberty Foods, an Iowa-based co-packing, private label manufacturing and foodservice supplier of sliced deli meats with a facility in Tremonton, says it's important "to take the miles off the food" whenever possible. "We all need to understand how and where our food comes from," he says. "It's easier to get it to our customers on the West Coast from Utah without putting thousands of miles on the product."

West Liberty Foods employs a total of 1,984 workers in its three plants located in Tremonton; West Liberty, Iowa; and Mt. Pleasant, Iowa. The Tremonton facility employs 641 workers.

Mark Suchan, plant manager of MOM Brands' Tremonton facility, says MOM Brands opened its Utah facility primarily for the state's distribution advantages.

"Our location to the West Coast markets and the Intermountain West markets was a critical part of the decision." he says. "We can be in Seattle from Tremonton in 12 hours and we can be in Los Angeles in 12 hours."

MOM Brands, known primarily for its production of a variety of Malt-O-Meal cereals, has five manufacturing sites across the country, including two in Minnesota, where the company is headquartered, and one each in North Carolina, Iowa and Utah. The Tremonton plant opened in 2003 and currently employs about 240 of MOM Brands' 1,800 total employees.

Even locally owned food manufacturing businesses, like Sunset-based Chaparro's Tamales, have to take their location into consideration. The company began in Utah in 2001 and since then has expanded to distribute tamales to 17 states, with plans to add a few more this year.

"We've talked about moving before, but we've stayed here because Utah is a central hub to other places we want to go," says Steven Melson, sales manager. "If we went farther west, we would be pretty limited to where we could distribute to, and if we went any farther east, not a lot of sales would happen there because people in the Midwest don't seem to like Mexican food as much. We're really content with being here in Utah?"

A Qualified Workforce

Although location is the primary driver for most food manufacturing companies, Utah's workforce has enticed companies to stay put. "[Utah's workforce] is equal to or better than a lot of places I've seen." Garrett says. "We've been able to grow our business in Utah because of the workforce. We continue to add jobs and processes in Tremonton because we're comfortable with the workforce available."

In fact, Garrett says because of Utah's workforce, the Tremonton plant has expanded three times since it opened in 2007. "We just added another 50 to 60 jobs with our most recent expansion," he says.

When it comes to the range of wages food manufacturing employees in the state are paid, companies are taking a variety of different approaches. At the Malt-O-Meal plant, employee surveys and stats from The Employers Council are heavily relied on.

"Because of the high-quality jobs that [food manufacturing] creates, we are well above the average job rate Suchan says. "We've partnered closely with local applied technology schools, like the Bridgerland ATC, to help us build those skills internally."

Bingham says many people get the wrong idea about jobs in the food manufacturing industry. "People think they are low tech, but actually a significant number of the jobs are high tech," he says. "Companies constantly need process engineers, process automation workers and engineering managers. It's not like the old I Love Lucy days of working on the conveyor belt."

Manufacturing as a whole pays a 28 percent higher wage than the state average, Bingham says.

A Focus on Agriculture

Utah's abundant wide open spaces and ability to produce a number of agricultural products has also made it easier for companies to expand or relocate to the state.

"We're a co-op, so we're owned by farmers and we like to be in rural areas to be a good corporate citizen and protect traditional family farms," Garrett says.

"Tremonton caught our eye pretty well." Tremonton also caught the eye of MOM Brands. "[Utah] is a critical part of our manufacturing business," Suchan says. "We're an agricultural state, and that helps complete the commercialization of the commodities that we produce as a state. I think [food manufacturing] is very critical to our infrastructure."

Bingham says agriculture is typically a big part of what a food company looks at when it's planning on expanding or relocating. "When a company comes in, they look at the supply chain and ask, 'What other companies are in Utah and could we use their product to produce our product?" Bingham says. "If you're a [cheese company], access to milk from dairy farmers in Utah is critical,"

Room to Grow

Suchan believes the food manufacturing industry in Utah, and the country as a whole, is growing quickly. "When I started with the company several years ago, we had a 3 percent market share, and now we're at about 10 percent," he says.

Changing trends in consumers' food desires will subsequently change the food manufacturing world, Suchan says, especially as more and more consumers lean toward organic and natural foods. "We continue to see growth in those areas, and I think the agricultural base here gives us a great opportunity to meet those needs in grain products and protein products."

Bingham says the areas he's seen growing in recent years include bakeries and artisan food producers, such as cheeses or chocolate.

Although competing against larger food manufacturers is difficult for Chaparro's Tamales, Melson says, the company continues to increase sales. Since 2008, the company has had steady growth with an 8 to 10 percent increase in sales every year.

"[Tamales are] not a staple of anyone's diet, even for Latinos," Melson says. "It's something special you get once in a while, but we're still in a pretty high demand."UB
Wages for Food Manufacturing Workers

Occupation                      Hourly median wage   Annual median

Butchers and Meat Cutters             $12.25           $25,480

Meat, Poultry, and Fish               $12.42           $25,830
Cutters and Trimmers

Slaughterers and Meat Packers         $12.46           $25,910

Food and Tobacco Roasting,            $12.53           $26,060
Baking, and Drying Machine
Operators and Tenders

Food Batchmakers                      $12.05           $25.070

Food Cooking Machine                  $14.35           $29,840
Operators and Tenders

Food Processing Workers,              $10.32           $21,460
AN Other

(Sources: EDCUtah, Utah Department of Workforce Services,
U.S. Bureau of Labor Statistics)

Food manufacturing makes up 8.7% of Utah's total manufacturing industry.

There are 15,231 food manufacturing workers employed in the state of Utah.

There are a total of 327 food anufacturing facilities in the state of Utah.
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Title Annotation:Special Report
Comment:Food for thought: food processing is a big slice of utah's manufacturing pie.(Special Report)
Author:Madison, Rachel
Publication:Utah Business
Article Type:Company overview
Date:May 1, 2014
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