WANTED: Application engineers

Extensive recruiting and training on the rise as cutting tool distributors seek to fill hiring gap

By Ken Brack -- Industrial Distribution, 3/1/1998

Candidate A: Empathetic, reasonably ego-driven, assertive, high emotional energy, technically skilled.

Candidate B: Lengthy shop experience, industrious, few people skills, mechanically oriented.

If you're John Hackenberg, Candidate A gets the job. That's because Hackenberg, president of J&H Machine Tools, Inc., a machine tool distributor in Charlotte, N.C., wants engineers with a blend of technical and strong interpersonal skills. Not just someone who is proficient in computer numerically controlled milling, turning and programming. That is a pre-requisite, of course, to guide machine shop customers on how to manufacture a part and what tools to use. But in addition to those skills, Hackenberg seeks service-oriented engineers who are not afraid to use their powers of persuasion on a customer. Those without sales acumen need not apply.

So where are all these super-engineers?

"They're in short supply," says Ralph Nappi, president of the American Machine Tool Distributors Assn. "The hiring labor shortage is by and far away the challenge my members are experiencing, and their customers are experiencing. There's [also] plenty of openings for machine operators and manufacturers can't hire enough applications [engineers] to service people."

"They're out there, but you have to work to get them," Hackenberg says. "Most of our people come from the manufacturing community."

To find more applications specialists, some companies such as J&H Machine Tools try to woo prospects away from northern climes to warmer environs. A few retain recruiters to check with manufacturers and supply a steady stream of resumes. Other cutting and machine tool distributors focus on training their existing engineers to assist customers with the latest equipment even as they search for more help. Applications engineers typically earn between $35,000 and $47,000 a year plus benefits. They also do not necessarily need a four-year degree, although a two-year vocational-technical school degree is often a prerequisite, along with hands-on experience.

The demand for more applications engineers among distributors has grown since manufacturing companies cut those positions during the late 1980s and began outsourcing their parts processing. The shortage worsened as manufacturing industries invested heavily in metalworking equipment during the past six years to increase capacity and productivity - a cycle that is not yet finished. Cutting and machine tool orders are expected to grow again this year, by five to eight percent, according to AMTDA. The United States Cutting Tool Institute, which represents 100 manufacturers, expects another "incredibly bright'' year, particularly in aerospace, followed by automotive and heavy equipment parts, says William Cleveland, USCTI president and president of Craig Tools, Inc. in El Segundo, Calif.

"Today there are a lot fewer process engineers than there were on the shop floors [a decade ago], and distributors are doing some of this,'' says Jim Hagan, manager of marketing research and planning at Kennametal Inc. in Raleigh, N.C., a large cutting tool manufacturer.

Hackenberg agrees. "Every year for the last decade we have seen an increase in requests from our customer base to do more for them in terms of engineering, applications, training and service,'' he says. Nappi, of AMTDA, believes there is no short-term fix for the shortage.

Training institutes keep busy

The dilemma for distributors mirrors the skilled worker shortage faced by precision machine makers across the United States. Shops that produce dies, molds and machine tools, which are used to shape everything from metal for car parts to forming rubber products, report they have thousands of job openings. Across the country, vocational schools, colleges and industry groups have beefed up tech prep apprenticeship programs to train more metalworkers, but the tool-making industry alone has an estimated 20,000 openings, trade group officials say.

Meanwhile, to stay sharp on new applications many cutting and machine tool distributors train their existing engineers frequently on new equipment. For example, although he only has two service engineers, Bill Chapel, president of Northcoast Machine Tools in Willoughby, Ohio, sends them to Miyano Machinery's' technical center in Chicago for three days of training about every other year.

"It's almost required that while a lot of machine tools are the same, some have some unique features," Chapel says. "As things change we still depend on the manufacturer to provide us with training...It's better for the manufacturer too. The better trained the service guys are, the less phone calls they receive.''

Okuma America Corp., a mill and lathe manufacturer based in Charlotte, N.C., established its formal technical institute four years ago to train its distributors' applications engineers and customers. Thirty-two of Okuma's distributors sent staff to be trained on new lathes, machine centers and grinders last year, and more than 200 engineers participate annually, says Bob Lewis, manager of the company's applications engineering department and training group. He says that on average in 1997, participating distributors' engineers had seven years of applications' experience and 15 years in engineering overall.

"Our function here has always been to train the distributors so they can support the customers," Lewis says. "There's a lot of experience out there."

To increase the supply of precision machinists and engineers, trade groups such as the National Tooling and Machining Assn. are working with manufacturers and colleges to improve technical programs and apprenticeships. The NTMA, which represents about 3,000 companies in an industry with 14,000 firms and 400,000 employees, operates 21 training centers across the country, mostly cooperatives with technical schools. The goal is to attract more youths to become skilled machinists and manufacturing engineers, a pool of talent from which distributors and others may find process engineers, says Lewis and NTMA education director Richard Walker.

Shortage may continue

The drain in applications engineers and machinists has "been going on for the last decade but the real impact has been in the last five years," Walker says. "We're going to have to do something in the next five years or we're going to lose a real leadership role in worldwide manufacturing.''

Some manufacturers worry that the next labor shortage will be among industrial engineers who use computer aided design to engineer machine parts based on a customer's drawing, Walker says. Similar to the outsourcing of process engineers, more large end users such as automakers have reduced their overhead by requiring design work be done outside their plants by distributors or other suppliers, he says.

Hackenberg suggests that distributors learn how to properly recruit and screen prospects. His company, which has 65 employees, has employed a psychological test for prospective applications engineers for 15 years. Only those with a mix of practical machining talent, high energy and people skills make it. "We're kind of doing a little DNA selection,'' he says. "And the reason we're doing that is because we want to be the best performer we can be. We can only do that with the best people."

J&H Machine Tools also retains a recruiter who knows the machine tool industry well. The company convinced two recent hires to leave New York and Pennsylvania for the booming southeast. His engineers do a lot of "turn-key work,'' recommending cutting tool applications for customers. The applications work varies with every job so "they like the variety...We let our people know they are an important link to our customers and are vital to our success." I