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In this edition of ISHN's e-newsletter we examine the effects of the struggling U.S. economy on the safety and health profession - and what pros can do when money gets tight. The report is divided into these sections:
- American Industrial Hygiene Conference and Expo review
- U.S. economic outlook
- EHS money issues
- Regulators feel the pinch
- What to do
DOWN IN DALLAS
A good starting point is last week's American Industrial Hygiene Conference and Expo held in Dallas. Acres of open slots in the parking garage of the Philadelphia International Airport is the first sign of the economy's dampening effect. Then, at the gate for the flight to Dallas, a corporate industrial hygiene director mentions how little travel he is doing these days, and the relentless cost-cutting at his corporation. Turns out there is plenty of leg room on this flight; less than half the seats are filled.
Down in the Big D, it doesn't take long to see signs of tight money.
Doesn't take long to walk the expo floor end to end; booth space is contracted. One major vendor, MSA, cuts its booth size by half, according to a company staffer. Another vendor, Bacou-Dalloz, cuts back on promoting its uvex and Willson eyewear brands, and its Howard Leight hearing protection.
Several exhibitors talk of sending less personnel to man booths. One half-jokes that all he needs is a 10-foot booth and a computer linked to his Web site to show product lines.
As in recent years, a couple of exhibitors again express the wish for a single safety and health expo, to be held every two years like the mammoth A+A safety trade fair in Germany. The current trio of annual U.S. safety shows - the AIHCE, the American Society of Safety Engineers' meeting in June, and the National Safety Congress in September - is getting more and more costly and redundant, according to some vendors. "There's not enough new product development in safety to warrant three shows a year," says one exhibitor.
Attendance in Dallas is down roughly ten percent from last year, according to Steven Davis, executive director of the American Industrial Hygiene Association. This is no surprise. "The norm for association meetings now is to be down about 15 percent," says Davis. "It will take several years to bounce back."
More surprising to AIHA, and another sign of tight wallets, is the high number of last-minute registrations, and attendees booking their own rooms rather than use the conference hotel bureau. When times are uncertain, spending decisions are put off, and professionals use the Internet to find the cheapest flights and rooms. This wreaks havoc with an association's ability to forecast attendance and block out rooms in advance.
THE BIG PICTURE
Officially, the U.S. economy is not in a recession. According to Wachovia Securities, the recession ended more than a year ago and we've seen six straight quarters of rising real Gross Domestic Product.
But the recovery has been a slow uphill crawl. Growth in the first quarter of 2003 was a meager 1.6 percent, and forecasts call for weak 1.8 to 2.2 percent growth in the second quarter. For the second half of this year, the Federal Reserve Bank of Philadelphia projects 3.4 percent growth, followed by an overall 3.6 percent gain in 2004 - stabilizing but short of energizing.
Personal protective equipment manufacturers feel the sluggishness. Bacou-Dalloz CEO Claude-Henri Balleyguier predicted to ISHN late last year sales growth of two to three percent for his company in the U.S. in 2003. Bacou-Dalloz's first-quarter worldwide sales were down three percent, though U.S. sales remained steady (-0.3 percent) thanks to growing demand for domestic preparedness and emergency response products.
Safety products distributors also feel the squeeze. Hagemeyer, a Dutch industrial supplies distributor whose U.S. lines include safety, had a 7.1 percent sales decline in first quarter 2003.
Meanwhile, unemployment proves hard to budge, remaining slightly lower than six percent, which is on the high side for a supposed recovery. In five the last six months, payroll losses amounted to 550,000 jobs.
The dearth of jobs is a prime reason more college grads in 2003 are opting for graduate school. Applications for grad school entrance exams are up more than 35 percent.
Lackluster growth prospects have companies counting pennies and aggressively controlling costs. Entering this year, Balleyguier spoke of the need for "very careful spending (and) being more selective than ever in incurring expenses."
CLOSER TO HOME
"Very careful spending" is obvious in ISHN's 2003 White Paper survey of safety and health department budget and staffing plans. Only one in five professionals are working with bigger budgets this year, and only about one in ten are adding to headcount.
Money's tough to pry loose when it comes to salaries. Typical wage increases for safety and health pros this year average about three percent. And moving to a new job is no sure way to increase income. Only 18 percent saw their paychecks grow more than ten percent the last time they made a move.
Layoffs and outsourcing are other obvious signs of belt-tightening. Almost one-in-five pros surveyed by ISHN (18 percent) are self-employed now, and the ranks of the free-agent nation keep swelling.
One of the buzzes at this year's industrial hygiene conference in Dallas was the news that for the first time, the number of American Industrial Hygiene Association members who are either self-employed or work for consultants equals the number of members in private industry. "How much more can industry cut back on industry hygiene?" asked one long-timer AIHA member. "It's a scary trend."
"Corporate EHS departments have gone from ten to one to now none," said another attendee, mentioning several high profile EHS directors recently let go. "I don't know who's minding the store."
One of the MSDS vendors in Dallas has set up a 24/7 call center staffed by hazmat specialist to handle midnight queries from clients that have outsourced MSDS management. "We have companies like Home Depot and AT&T saying, 'Here, you are my hazmat department to handle permitting and questions'," said the vendor.
Almost every operation in a facility is up for outsourcing in today's cost-slashing world, not just safety and health departments. IT programming and accounting departments are shipped out to countries like India. Production lines are run by subcontractors in Asia and South America. Then there's human resources. One EHS consultant sees clients coming back to her asking for more and more training programs.
No wonder consulting comes out on top when ISHN asked pros where the best jobs will be in the next five years. But all this outsourcing doesn't mean the grass is greener for consultants. An IH consultant has seen his hourly rate drop from $100 an hour ten years ago to $60 today to keep long-time relationships going. "I wasn't going to do it, but I know there are people out there who will do it for $50 an hour or less," he says.
Scarce resources hinder the efforts of both federal and state safety and health regulators. President Bush recently proposed a fiscal 2004 budget of $450 million for OSHA, down from the $453 million OSHA is operating on this year.
Out in the states, Minnesota, Vermont and North Carolina all threatened to drop their OSHA programs to save bucks earlier this year. They backed off after businesses said they would rather deal with home-grown inspectors than the feds. Nebraska killed its Workplace Safety Program in April, eliminating the state's nine safety inspectors. They only offered suggestions to businesses and did not have the power to penalize because Nebraska does not have an approved state OSHA program.
Cal/OSHA, the California Division of Occupational Safety and Health, considered by many to be the premier state OSHA program, is feeling the stress of California's $36 billion budget deficit.
According to a presentation at the AIHCE by Garrett Brown, a Cal/OSHA officer, one or more of the top three agency leadership positions have been vacant for significant time periods in the past several years. The Cal/OSHA Medical Unit consists of one physician and two registered nurses - down from seven MD's and three RN's in 1975. The ratio of inspectors to workers has going from one inspector for 14,419 workers in 1980 to one inspector for 101,779 workers in 2003. And there will be even fewer compliance officers if plans to cut 10 percent of all state department personnel costs are implemented.
OK, what's the antidote for lean, mean times? What smart moves can you make to keep your EHS position, department and career afloat? Here are 13 examples of what professionals are doing:
1) Follow the money. Look for turnaround situations where the pressure is on companies to improve safety and health. One safety pro has gone to work for a company that "used to treat employees as expendable. Now new owners have changed attitudes and poured money into the program. The safety budget this year is almost $2 million for 450 employees at the one location," he says.
McWane, an operator of pipe fitting foundries and plants around the country, was the subject of a New York Times series earlier this year for a history of safety abuses. Now the company has gone out and hired Pat Tyson, a former OSHA chief, as consultant, and boosted spending in safety and environmental programs from $25 million in 1999 to $62 million in 2002, according to a recent article in the Times.
2) Follow the lawyers. Forget the regulators, they're not setting new standards, says one industrial hygienist. He sees liability risks with largely ignored reproductive hazards, and is positioning himself as an expert in this niche.
Meanwhile, a two-year effort in Washington to build consensus for updating and tightening OSHA's permissible exposure limits has run aground - the American Iron and Steel Institute has rejected draft proposals, according to one source. In the absence of tougher rules, compliance is largely under control. Ninety-five percent of all air samples taken at workplaces are below OSHA limits, said a presenter at the AIHCE.
3) Follow public opinion. Yes, fear creates career opportunities. Right now the public is freaked by tales of toxic mold and threats of terrorism. At this year's AIHCE, mold and bioterrorism were SRO sessions. AIHA and ASSE are jockeying for position over state mold laws, each trying to ensure its members get access through licensing programs to the inspection and remediation action.
And EHS pros have the skills to be on the front lines of securing workplaces and protecting emergency response crews against terrorism bombs and biohazards. One industrial hygienist passed up this year's AIHCE to attend a FBI terrorism class; another bypassed Dallas for a two-week Federal Emergency Management Agency seminar in Iowa.
4) Fireproof your job. That's ASSE President Mark Hansen's term for taking steps to prove your corporate worth. Among his tips: Keep your cool, be flexible, be decisive, stay positive, and get to work before the boss each morning.
5) Brand yourself. Compliance consultants are commodities. Hourly rates keep diving. That's unless you've got a reputation as an expert in a specialty. A handful of industrial hygienists who have become known in asbestos litigation circles are working 80-hour weeks, according to one of them. She's having an office built in her basement to handle the expanding business.
6) Find a partner. That's what OSHA is doing to try to get more bang for its buck. To expand its reach, the agency has 185 active partnerships with companies and trade groups, and 25 national alliances.
7) Lead with safety. That's what Behavioral Science Technology is promoting, having trademarked the term. "As the business climate continues to change, it is critical that we think beyond traditional safety management paradigms that limit safety to a discreet function," writes Tom Krause, BST's CEO, in the company's magazine, "Perspectives in Behavioral Performance Improvement." Safety, he writes, "is an area worthy of serious attention from all levels, and (is) a foundation for other kinds of organizational excellence."
8) Go electronic. That's what AIHA members are increasingly doing to cut travel expenses. In 2000, the association had about 300 people participate in Teleweb "distance learning" programs. Last year, more than 1,600 participated in five offerings. This year, AIHA plans eight events, and more than 720 pros have participated in the first two.
"The tough economic forecasts make it as good a time as any to embrace the Information Age and continue to build our Global Village," says industrial hygienist Andrew Cutz. He says AIHA's International Affairs Committee has organized a series of video conferences on flood relief aid that connected seven sites spread over four time zones in three countries and two continents.
9) Negotiate. More than 150 AIHCE attendees in Dallas packed a room to learn how to "create mutual gains," "exploit cultural expectations," and engage in "joint gain shaping." This stuff doesn't come easy for pros steeped in technical traditions, but you need some competitive fire to grab those limited funds today, said the speaker. He related this anecdote: A manager called a hygienist's bluff at the negotiating table, only to have the hygienist give up and walk out. "I can't believe he wouldn't negotiate," said the surprised manager.
10) Take heart. Have courage. "I offer a guarantee on both the quality of my service and on a positive return on investment," explains safety and health consultant Chip Dawson. "There's no reason an in-house person can't do the same thing, if he or she really believes in his product and her ability to deliver."
Dawson adds: "If your management wants to cut safety to the bone, start looking elsewhere. Nearly all the folks I know who have bailed on an uncommitted management have landed in much better positions where management does care. It may take time between jobs, but there are still a pretty good group of caring companies out there who need and want our help."
11) Take a temporary assignment. Sometimes that lull between jobs can be filled with an interim assignment. Who knows, it might lead to something permanent. A safety pro cut loose last February is helping a small manufacturing company develop safety programs instigated by an OSHA inspection. Another pro relocated from Wisconsin to Texas and is setting up a safety program for a small company, and he says the job could become permanent.
12) Position yourself for emerging issues. At the AIHCE, NIOSH director John Howard gave what some called the best speech at the conference, an inspiring, upbeat look ahead at future opportunities and challenges in the supposedly mature world of workplace safety and health. Among them:
13) Get off the crusade. At the National Safety Congress coming to Chicago this September, Gary Lopez, a corporate director of EHS, will make the case that safety should not be a crusade, but a matter of risk management, which translates better into the language of business. "Pure hogwash" is what he calls time-honored concepts such as zero accidents and "safety first". They promote safety segregation - walling off safety managers from others in the management mainstream. "Manage risk, not safety," is the title of his talk.
Dave Johnson is the ISHN E-News editor. He can be reached at email@example.com, (610) 666-0261; fax (610) 666-1906.
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WE NEED YOU!Are you a safety and health pro or a manufacturer or provider of occupational safety and health products or services who enjoys writing?
Shakespeare need not apply, but ISHN is looking for authors to publish short articles (1,000 words) in our monthly issues.
Topics include: safety success stories, close calls and personal experiences, training tips, use of software, engineering controls (machine guards, lockout-tagout), gas detection and air monitoring, confined space safety, personal protective equipment, and OSHA compliance issues.
If any of these topics interest you - or if you have other ideas - e-mail editor Dave Johnson at email@example.com
We will also consider articles you've already written but not submitted to any safety magazine.