Sanmina Corporation will close one of their printed circuit board operations in Owego, New York. Hundreds of employees were told they would lose their jobs. Sanmina is the largest EMS company in the U.S., and this plant could be the last volume manufacturer in the States.
During the 1990s, Internet technology was ramping up and the computer, telecommunication, and EMS industries were booming. Printed circuit manufacturers were benefactors of this influx of business and most of them expensed millions in capital expenditures to increase their manufacturing capacities. Major electronics companies increased their in-house manufacturing of printed circuit boards and assembling and hired engineers and operators for this production. Some companies could not wait to grow internally and acquired many firms through mergers and acquisitions. Many EMS companies quickly grew by purchasing printed circuit board manufacturing facilities. Outsourcing was the norm for several electronics companies that decided to sell their manufacturing facilities at inflated prices. The spike in business was dramatic, and the electronics manufacturing structure changed overnight. Sanmina became the largest manufacturer of printed circuit boards in the U.S.
The business environment changed drastically in 2001, with the collapse of the IT bubble. Early in the recession, many companies were able to weather the storm; however, market conditions worsened, and purchasing manufacturing facilities lost its luster. To reduce labor costs, companies moved their manufacturing facilities to China. For some it was too late, their only option was to close plants and liquidate buildings and equipment at rock bottom prices. The printed circuit board industry in the U.S. lost more than 100,000 jobs in five years.
At its peak, Sanmina operated 10 circuit board manufacturing facilities in New England and New York with over 10,000 employees. All but the Owego plant closed during the early 2000s. The Owego plant survived all these years, but production continued to shrink year over year.
I am saddened to lose business colleagues from the industry. Over 200 circuit board manufacturing firms remain in the U.S; unfortunately, they are prototype shops or small-volume manufacturers. The glaring problem with these smaller manufacturers is a lack of an engineering staff. Their R&D capabilities are not equal with their competitors. The large circuit board manufacturers and in-house manufacturers for major electronics companies retained their R&D capabilities. It’s unlikely to expect any significant progress for new technologies without the existence of these large and well-funded companies. Small companies have to develop new leading technologies using their own limited resources. Not impossible, but a daily grind for most of them.
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