Schüco USA to Downsize; Follows Announcement by President of His Departure

Schüco USA submitted a Worker Adjustment and Retraining Notification (WARN) to the Connecticut Department of Labor. In the notice, the company announced that it will downsize its Newington, Conn., fabrication unit and keep only the wholesale division.

The downsizing will affect approximately 95 employees.

A WARN Act notice is a federal law that requires employers with 100 or more full-time employees to provide at least 60 days notice in advance of a worksite closure or mass layoff affecting 50 or more employees.

Schüco’s human resource manager, Laura Sprague, writes in the notice that “after several difficult years of business with supply chain interruptions, inflations, geopolitical challenges and unprecedented disruption caused by the COVID-19 pandemic, Schüco has made the difficult decision to downsize its fabrication unit by the end of 2023, keeping only the wholesale division.”

The WARN notice followed the announcement by Schüco USA president Attila Arian that he was departing, made a few days earlier. His last day with the company is April 30, 2023. He plans to remain in the U.S. glass industry. “I will stay in the U.S. and stay loyal to this industry,” he says. “I will work with people who want to build sophisticated and beautiful buildings and continue to build teams with the common goal to support and enhance knowledge transfer in the industry. What you know me for will stay the same; only the background will change.”

Arian says he is grateful to Schüco and the opportunities it has provided.

“One of my greatest accomplishments is having been actively involved in forming the Virtual Construction Lab in New York, which was developed as a Research and Development Lab, with the intent to share our findings with the industry and empower fabricators and installers,” he says.

Before joining Schüco, Arian was president of seele’s U.S. operations. He has an engineering degree from TU Darmstadt/Germany and more than 30 years of senior and executive level experience in residential and commercial construction both in the U.S. and Europe. In 2021, USGlass magazine named Arian one of the “Industry’s Most Influential People.”

Challenges Await Construction, Glazing Companies in 2023

No industry is immune to increased inflation, including the glass industry. It saw companies increase prices and surcharges due to various economic pressures in 2022. The entire construction industry has felt the effects.

While 2023 could be the year where recessionary indicators dampen the double-digit annual construction inflation trend, challenges remain in local markets throughout the U.S., says Steve Stouthamer, executive vice presidentof Skanska, one of the country’s largest general contracting firms. In fact, several cities and regions are expected to see construction costs rising above the inflation rate over the next year.

As many companies brace for a potential recession, they pause growth to cut costs. This means less need for additional space and less work for the construction industry.

In Seattle, for example, many major brands, including Microsoft, Amazon, Meta and Kaiser Permanente, have put building projects on hold. As such, contractors are under pressure to reduce fees as the competition for work increases.

The contractions are not universal. Joe Comfort, a regional business representative for District Council No. 4 International Union of Painters and Allied Trades, hasn’t seen any slowdowns in Central and Western New York. In fact, Comfort says they have more than 30 $100 million projects either ongoing or coming up. They also have the largest construction project in the history of the company at $100 billion on the horizon.

“The amount of work coming is ungodly,” he says.

Workforce Challenges

Labor shortages also impact the industry. In some cases, the shortages have forced companies to decline work and raise wages. According to Skanska’s Construction Market Trends Report, average hourly construction wages in December 2022 increased to $35.57 from $35.42 in November. Comfort says that while projects are in abundance, the same cannot be said for workers.

“Nobody has enough workforce to meet the demands of work coming from
upstate New York,” he says.

The report added that 5% of positions in construction remain unfilled. In
December 2022, construction unemployment increased by 4.4%, higher than
the national rate of 3.5% for all industries. It’s been tough to get people in the door, Thomas Cornellier, CEO of TSI Corp., told USGNN™ in January.

“It’s difficult to hire for the trades,” he said. “It’s tough to get younger people
into the trades despite the great benefits that come with it and the skills that
you learn.”

Local Construction Costs Across the U.S.

Skanska’s report also took a close look at regional economic indicators. According to the report, which measured inflationary impacts over the next six months, the next six months to a year and the next one to two years, above-average construction price inflation will impact various cities throughout the U.S. Of the 21 major U.S. cities and regions surveyed, the majority can expect construction price inflation to be above normal (between 3% and 5% over the next two years).

The report also expects Orlando and Phoenix to experience significant/abnormal construction price inflation (greater than 5%) over the next six months to a year. New York is expected to see greater than 5% construction price inflation throughout the next six months.

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