Forbes magazine, April 2007 According to Lou Dobbs, a story like this can’t happen. A midwestern state increases its sales of manufactured goods for export by 27% in one year. Manufacturing? Midwest? Don’t the numbers run all downhill in the flatlands? Not in North Dakota. This thinly populated state of 637,000, which tops only Vermont and Wyoming in population, exports about $3 billion in goods. To put this in context, North Dakota’s gross state product is only $24 billion, a blip in America’s $13 trillion GDP. Even so, North Dakota’s export growth trend is encouraging and offers a bit of evidence that small midwestern manufacturers can compete globally if they want to.
The state’s largest exporter is Bobcat Co., started 49 years ago by two blacksmiths helping a turkey farmer who wanted a faster way to clean coops. They attached a scooper to a small loader and rigged it to pivot in tight turkey quarters. In 1995 Ingersoll Rand (nyse: IR – news – people ) bought Bobcat, by then the U.S. leader in small loaders and excavators. During the last ten years Bobcat has pushed into European and Asian markets with success and added a plant in the Czech Republic. But the ‘Cats are still mostly made in two North Dakota plants, in Bismarck and Gwinner, a tiny hamlet of 750 souls, 80 miles southwest of Fargo.
The Gwinner factory employs 1,300 and pays workers an average hourly salary of $19 per hour. Many of these workers grew up on farms, and therein lie at least three advantages: a good work ethic–farmers learn early just to jump in and help; an innate grasp of how piecework fits in the whole system and, therefore, what work is needed to complete a task; and a knowledge of machinery (no farmer lasts long who can’t do his own mechanical repairs).
Bobcat pays its North Dakotan workers more than it pays its Czech workers and assuredly more than it would pay workers in China. Yet it elects to manufacture in North Dakota and pay farm folk more for their work ethic and practical ingenuity. Last year Bobcat shipped $550 million in Bobcats to foreign countries. This year it expects to ship $700 million abroad. Something’s working.
Are you reading this, Lou Dobbs?