Encompass is honored for reaching status for more than twelve years

Greensboro, North Carolina, November 1, 2022– Encompass Solutions has achieved the Gold Partner recognition for 2022. Recipients are selected by Epicor Software Corporation based on Employee Certification, Customer Support, and Customer Satisfaction. Gold Partners exhibit deep expertise in manufacturing and ERP systems; their experience distinguishes them in the field.

“I’m excited about our continued partnership with Epicor Software and the Epicor Partner Community. Also, being part of a growing organization like Encompass Solutions is why I get up in the morning!” Jason Claggett, Managed Services Manager of Encompass Solutions.

Encompass Solutions has a longstanding relationship with Epicor and its focus on Epicor ERP business solutions, has allowed them to deliver mission-critical ERP software solutions, custom development services, and process improvements for businesses in the manufacturing and robotics, and automation industries. Professional services in ERP consulting, project management, EDI, and ERP software implementation, upgrades, training, and more.

“It’s an honor for Encompass to be recognized as a valued partner by Epicor for over twelve years. Our continued partnership with Epicor allows us to build better relationships with our customers. It feels great to know Epicor is supporting us in our success.” Rob Cummings, Senior Financial and Operations Consultant.

Epicor Certified Partners

Epicor Partners have been specially trained and certified to provide Epicor software solutions, project planning and management, training, and ongoing support services. Extensive training and experience enable them to offer the highest value over time.

About Encompass Solutions

Encompass offers professional services in ERP consulting, project management, EDI, and ERP software implementation. We specialize in enabling manufacturers of every size with full-scale ERP/MES implementation, integration, and renovation of existing systems. Our expert consulting and IT staff deliver the tools, training, and confidence manufacturers need to address emerging challenges in corporate and operational growth. Encompass provides a specialized approach to every client’s needs, identifying customer requirements and addressing them with the right solutions. We ensure our clients are equipped to match the pace of the industry with business systems to fit the build. Encompass is a certified Gold Partner of Epicor.

To learn more about Encompass Solutions, please visit www.encompass-inc.com.

A New Epicor CPQ Release Is Coming Friday, October 21

Epicor is excited to announce the next major Epicor CPQ release on Friday, October 21, 11:00 PM – Saturday, October 22, 4:00 AM Eastern Time.

Read on to learn more and how to prepare for your upgrade.

What’s New in Epicor CPQ Release

This major release includes significant improvements, including modernizing the server framework and performance enhancements, especially for searching. This is also the first release that includes embedding Epicor’s new Automation Studio into the portal and a new 3D feature, Sketch and Extrude.

New features and enhancements include:

  • 3D Features/Enhancements
    • Sketch node and associated classes and UI
    • Circle with center and radius path
    • Utility to flip path direction
    • Automatically determine to extrude direction instead of defaulting to 0,0,1
    • Fix world transform of move sketch control point gizmo
    • Allow reordering paths and control points in the editor
    • Handle 3D paths
    • Mechanisms for Sizing Sketches
    • UI Shortcuts for creating new paths
    • Close sketch extrusion surfaces
    • Curve Path types for sketches
    • Positioning and orienting a sketch in 3d space
    • Add visualization renderer for sketches and paths
    • Sweep feature
    • Extrude feature
  • Update to .NET 6
  • Salesforce CPQ Integration enhancements
  • Embedded Automation Studio
  • Allow Quote Header fields to be marked “Searchable”
  • Elastic Search

You can learn more about each feature by visiting the CPQ Wiki and make sure to check out our What’s New video on Epicor Learning Center.

What to Expect
Here’s what you need to know about your upgrade:

Friday, October 21, 11:00 PM – Saturday, October 22, 4:00 AM Eastern Time
While Epicor upgrades your Production to, your system will be unavailable from Friday, October 21, 11:00 PM – Saturday, October 22, 4:00 AM Eastern Time.

Note after the upgrade: swap out the old extension with the new .NET 6-enabled extension for customers using an Extension.

Dates are subject to change.

As a reminder, reach out to EpicCare whenever you have a question or need application support. We hope you are excited about the new innovations coming soon to Epicor CPQ. Thank you for your continued support as an Epicor customer.

Subscribe to Status Alerts
Subscribe to receive additional email or text notices regarding routine updates, scheduled maintenance, or system outages at status.epicor.com.

Encompass Solutions Retreat

I started with Encompass in February 2020, just before Covid had us on lockdown. This affected the infamous company retreats. I heard a little something about them and was looking forward to attending, but it wasn’t going to happen that year. Maybe next year? Nope! We gotta stay safe and wait it out one more time. Understandable.

Here comes 2022, and all employees received an individual email invite to the company retreat. Okay… nice touch. Making me feel special… I like it! I didn’t know what to expect since this would be my first time ever going to any company’s retreat. Now I’m curious… Will we be working all day? What types of activities will there be? Will the food be any good? I did know that this would be my chance to meet co-workers I’d been virtually communicating with for over two years.

Let me skip ahead a bit. We formed teams beforehand. Remember back in grade school during P.E. when we were chosen by “captains” to be on their teams? Yeah… no, it wasn’t like that. We were given a task and had to find each other. It wasn’t hard, so I didn’t have to enlist Scooby-Doo and Mystery Incorporated for help. There were three pre-retreat challenges that we had to finish and submit for points. This was the beginning of teamwork that continued over into the retreat.

We’re here! Meet and greet the first evening. It was fun!! Had a great time meeting the ones I’d never met and seeing the ones I’d met when I was in the office. Since it is a company event, in case you’re asking… yes, we did have meetings. It wasn’t like that episode of the Golden Girls where a former student hired Dorothy to train the team at his company, and everyone left to do other things like play golf. I don’t think our leaders would have been too happy with that type of behavior. Our teamwork was incorporated into meetings where we brainstormed, answered trivia questions, and came up with ideas that would add to Encompass’ success. The afternoon events consisted of scavenger hunts, learning Michael Jackson’s Thriller dance, and building boats using duct tape and cardboard.

The scavenger hunt was fun. It was a timed race against the other teams, so we had to be quick and creative. Well, we had to be as quick as we could because we were on a mountain. Reading comprehension played an important factor when following written directions. I don’t remember exactly how many hunts we completed. When we were finished with one, with a short team exercise afterward, we were given another hunt. Just when we thought we were done for the day to head back to our rooms to prepare for dinner later, we were told that we all had to learn the Thriller dance from Michael Jackson’s video AND perform it. Say what now? Excuse me? Ma’am… the King of Pop was also an entertainer. I needed at least 24 hours to learn and perfect those moves. I tried channeling my dance and cheerleading days but I was clearly rusty. YouTube was our friend. We looked at the video and chose a few dance moves to learn and added some creativity to it. This wasn’t a recital, so it didn’t have to be long. We were glad about that because we were tired from the scavenger hunts.

Time for boat building the next day. It was a pirate-themed event and to get additional supplies to benefit our teams, we had to duel with the pirate. We dueled with inflatable swords. Just imagine what that looked like. We could also duel someone from another team to get their supplies. Piracy was highly encouraged and in full effect. This meant that we had to work fast, be strategic, and definitely keep an eye on the wandering eyes and hands of thieves who tried to act like they were coming in peace. Oh… I didn’t mention that the boat had to float, someone had to get in it, paddle out to and around the buoy back to shore, and pull the boat out of the water by themselves, did I? How could it be a competition without literally testing the waters? This was also timed, so the adrenaline was running high. It was the last team event of the retreat, and everyone wanted to get as many points as possible to be named the 2022 winners.

I was having a lot of much-needed fun. My daughter was my plus one and she really enjoyed herself. The final night of the retreat was bittersweet. The team-building activities were over, and we would soon be getting ready to head back to our homes, but not before it was time to announce the winners. If I’m not mistaken, my team came in second place for both the pre-retreat and retreat challenges. We all are winners regardless of which place we came in. Sounds like one of those familiar “you’ll get ‘em next time” phrases, doesn’t it? But seriously… everyone put in a great amount of effort and worked together just as teams should do. That night ended with a live band and dancing that I will always remember.

Recently, we’ve been receiving many questions on Epicor’s Lifecycle Policy. This blog will outline the currently supported versions of the Epicor ERP system, the difference between Active and Sustaining support, and the upgrade options available.

Release Lifecycle

Like other software packages, Epicor Kinetic requires frequent patching. These can be for cosmetic (Updates), functional enhancements (Releases), or wholesale architecture changes (Version). Regular patching is necessary to keep the software running smoothly or plug security holes to keep you and your data safe. Epicor’s cadence is defined and outlined in the graphic below of how often you can expect updates, releases, and versions from Epicor. 

Support Lifecycle

Support is an essential part of any software package, and when things are running smoothly, you seldom need it. However, when issues arise and you need support, having an active support contract is the difference between being down for a short period versus an extended outage. The chart below shows what you can expect from a support contract. 

Active support gives you full access to Epicor phone support, security updates, and new issue investigation, to name a few. Sustaining support gives limited phone support, access to the latest release, and an online knowledge base. While you will no longer be able to purchase new modules under Sustaining support, you can purchase additional users for your version.

Review the comprehensive FAQs for Epicor’s support lifecycle. You will need a valid Epicor EpicWeb ID to review the guide. 

Product Lifecycle

All good things must come to an end. Or so the saying goes, right? The good news is Epicor software supports versions back to Version 8.03.400 and earlier under their Sustaining support model. Below is a chart outlining the transition date for each version of Epicor Kinetic ERP. If you are on the Epicor Public Cloud model, you never have to worry about being out of Active support – more on this option below.

What are the Options?

Your options are straightforward. On-premise customers have two options:

  1. On-premise upgrade: As long as you have an active maintenance contract with Epicor, you are entitled to the latest version of the Epicor Kinetic versions. This version can be installed in your server farm, a hosted server farm, or your cloud subscription (i.e. Azure, AWS, Google, etc.)
  2. Migration to Epicor SAAS Cloud: You can migrate your on-premise database up to the Epicor public cloud. Doing so provides a future of hassle-free upgrades and allows you to get back to running your business.

No matter which option you choose you will need to do something if you are on Epicor ERP 10.2 or earlier. To have a conversation about upgrading your Epicor software, email info@encompass-inc.com.

Epicor ERP is adding more capabilities for integration with the release of Epicor Automation Studio, a low-code/no-code integration platform as a service aimed at average business users. Automation Studio enables organizations to integrate their Epicor products and automate workflows end-to-end across apps, data, and teams.

The Challenge

By not implementing integrations, employees at enterprise organizations can’t access the data they need in the apps they use every day, such as Salesforce, ADP, and ServiceNow. This creates data silos, where employees are forced to: search for data across apps, re-enter data several times, and constantly context switch across applications to accomplish tasks.

Learn more about Epicor Automation Studio below:

Epicor Automation Studio

Manufacturing has had one wild year and, in the wake of COVID-19, many industry experts, boardroom executives, and men and women on the production floor are “shopping” their theories for 2021 manufacturing trends.

Theories for what 2021 will hold run the gamut, but there is plenty of crossovers shared among contributing voices. Here are some of the most often mentioned subjects we are sure will emerge as the most impactful 2021 manufacturing trends.

The Reshoring of Manufacturing

When the mechanisms of manufacturing all but ground to a halt in Q1 of 2020, it became vividly apparent just how dependent nations were on the capacity and capabilities of a select few manufacturing powerhouses. A year on and COVID scarcity has driven the prices of raw materials up 100-200% when compared with the same period last year.

In the wake of this glut, more than one-fifth of US manufacturers surveyed by BDO are committed to the reshoring of operations as a top priority in 2021.

While both the current and previous administrations are pushing for consumers to “Buy American”, the same sentiment is ringing loud and clear through the EU, Japan, South Korea, and many other leading nations.

The world bought cheap and abundant labor out of China for decades, which left supply chains around the world bottlenecked and vulnerable. Today, diversification of the supply chain is widely regarded by manufacturers as a must-have, and countries like Vietnam, Thailand, Malaysia, and Mexico are raising their hands to offer the capacity and talent to meet the needs of more local-focused supply chains.

Addressing The Education And Skills Gaps In Manufacturing

With decades of reliance on external manufacturing capacity, US-based manufacturers have seen an ever-increasing skills gap needed for their operations at home.

A tremendous contributing factor is the perception of manufacturing as a Triple-D sector. That is, dirty, dangerous, and dull. Whether on the shop floor or at the engineering desk, manufacturers are struggling to fill a gap in skilled jobs that Deloitte expects to reach nearly 2.5 million positions by 2028. Fortunately, according to the National Association of Manufacturers (NAM), manufacturers are willing to pay to close that gap.

Chad Moutray, NAM Chief Economist, said “Manufacturers consistently cite the inability to attract and retain talent as their top concern, and as this survey underlines, they are taking strong proactive steps to overcome it.” The Institute surveyed US manufacturers on their spending in the sector, which totaled more than $26 billion targeting training programs for new and existing employees.

Trade schools, analytics, sensor technology, robotics, AI, VR, etc. are garnering considerable investment to draw in the talent required to fill the deep need these manufacturers are experiencing.

Experts say that simply throwing money at the problem is not enough. Manufacturers and institutions need to share in the investment and collaborate to ensure that what students are learning now is what will be relevant in the manufacturing sphere by the time they graduate.

Talent simply cannot be trained to meet the needs of businesses because tech is changing at such an exponential rate. Agreements between schools and manufacturers will have to provide work experience opportunities while studying to close the gap.

In Encompass’ backyard, Guilford Technical Community College has received both considerable financial investment and buy-in from regional manufacturers with the institution’s recently opened Advanced Manufacturing Facility in Jamestown, NC. There is just as much investment from other manufacturers around the country who are hungry for an engaged and talented workforce produced locally.

Global Shortages Of Computer Chip Manufacturing Hit Home

With climate change, a topic of ongoing significance globally, the reliance on regionally produced tech has put the entire world’s supply of computer chips on thin ice.

Regional environmental conditions are now playing a much larger part than before in how we view the risk associated with the supply chain. For example, the majority of the world’s motherboards are manufactured in Taipei, Taiwan. This region is categorically prone to massive and disruptive weather events and earthquakes. For decades, this has been a reality the US, and frankly, the rest of the world accepted as part of navigating a global supply chain.

Initially, when the coronavirus pandemic first hit, semiconductor factories shut down, causing delays in the supply chain. Because it can take up to several years for these factories to reach their previous production levels, the shortage will likely persist for some time.

Everything from TVs to cars is affected by the shortage of chips, which effectively function as the brain of electronics. To put it in perspective, Apple, the phone manufacturer with a $2 trillion value and semiconductor budget of $58 billion annually, could not get enough of these in-demand chips for their iPhone 12 launch last year. The result was a two-month delay and things are only getting worse for manufacturers big and small.

According to Mirabaud tech analyst Neil Campling, “There is no sign of supply catching up, or demand decreasing, while prices are rising across the chain. This will cross over to people in the street. Expect cars to cost more, and phones to cost more. This year’s iPhone is not going to be cheaper than last year.”

Med Device And Pharmaceutical Manufacturing Look Pale

Such supply chain bottlenecks as mentioned above exposed overreliance on external manufacturers of pharmaceuticals and medical devices over the last year, as well.

Supply chain resiliency, through redundancy and duplication, is a costly and time-consuming effort. However, manufacturers are increasingly adopting a shift in thinking to ensure they can avoid the pitfalls COVID-19 has exposed.

Many medical devices and pharmaceuticals are only sourced through specific geographies. As a result, strategic goods and services will need to be tackled first in a new wave of focus from US manufacturing industries and policymakers. Luxury and consumer-driven products will have to take a backseat until those top-shelf items can be secured at home.

Shifting Trade Policies From Corporate To Congress

US manufacturers are driving the demand for diversity in a capacity beyond East Asia. However, many of the west’s manufacturers, big and small, are making moves to end reliance on the East Asian manufacturing hubs. Recent upsets in trade policy, like free trade agreements, Brexit, tariffs, the repositioning of NAFTA, etc. all impact these efforts.

While not directly parallel, policymakers and legislators are approaching the problem from their perspectives. Regulators’ opinions on the evolution of the supply chain are translated through a different lens than manufacturers. Geopolitical relationships and national security may not translate into the most favorable outcomes for businesses back home. Manufacturers want speed, efficiency, and capacity to deliver products to the hands of consumers. The government will view its priorities through a different lens.

Digital Taxation and Role Reversal

As the border between big tech and manufacturing become more blurred, digital taxation and who does what are the new hot topics. With an increase in digital cross-over into the material realm, the mechanisms of how to handle taxation have not quite caught up.

Namely, this involves the lines between tech and tangible and where the border between industries is truly defined. Perhaps the broader question is, can it be defined?  With companies like Facebook, Google, Apple, and others, who traditionally created digital products, now constructing marketplaces, and investing in tangible goods, like autonomous vehicles, are they considered the new pioneers in manufacturing?

Where does that leave traditional processes and discrete manufacturers? As discrete manufacturers create IoT and IIoT solutions to complement their tangible goods, like sensor and overall equipment effectiveness (OEE) software, do they share the profile of Big Tech? The waters grow muddy. One thing is for sure, the landscape of both tech and manufacturing is sharing more overlap than ever before.

Access to Cash and What it Means for SMBs

Borrowing and access to capital is a defining issue for smaller manufacturers. With interest rates low for manufacturers, questions about effective tax rates, trade relationships, and capital expenditure have been conservative. Fortunately, trade talks with the Biden administration and China have started to take shape, vaccinations are rolling out, and outlooks are generally optimistic.

One leading indicator of this upward trend is found in the number of bankruptcies experienced by manufacturers over the last year. Not nearly as many bankruptcies emerged as were predicted by researchers, analysts, and economists. The big change may have been the fact that banks do not want to become owners like after the 2008 housing crisis. There is simply too much to manage in manufacturing and rather than take on the headache of industry banks may not know enough to run effectively, they opted to work with businesses in the sector to find solutions that worked for both sides.

Robotics and Automation

Robots and automation have been four-letter words for decades, essentially scaring people away from manufacturing. Unfortunately for fear mongers, the need for skilled labor is even more necessary with the inclusion of these advanced technologies. More engineers, more cobot operators, maintenance personnel, and even truck drivers to fuel the internal distribution networks of the United States are in high demand. There will certainly be an upset in the world of manufacturing as these technologies proliferate. However, the timeline by which that proliferation overtakes a human workforce grows ever longer as technology proves to be just as reliant on us as we are on it.

The New Contract Manufacturers

New methods of manufacturing, such as 3D printing or additive manufacturing, are upsetting the traditionally held roles in Industry.

Take, for instance, the effect these technologies have bestowed on traditional distributors.

Third-party logistics providers (3PLs) like Fed Ex, UPS, and others are entering the manufacturing arena, cutting out a space for themselves, and cutting off competitors, in some cases manufacturers, by assuming certain aspects of manufacturing. By leveraging additive manufacturing technology, these logistics providers can cut out the middleman to handle the production and delivery of simple parts and components on a decent scale. You can send your CAD file directly to the 3PL, who will then print out the part and ship it directly.

For the recipient, potentially a manufacturer, in this case, there is a degree of control that is relinquished. Depending on your product, at some point, you will need to verify that your vendor (3PL) is meeting your quality requirements. While the approach is in its infancy with a foundation shaky enough to keep some at arm’s length, it could be a trend that picks up steam quickly. If these providers can achieve the quick turnaround they promise and meet the quality standards that manufacturers and consumers demand, there could be a real shift on the horizon.

Green Materials Propagate in 2021 Manufacturing Trends

Sustainability has never been a topic weighing as heavily on consumers’ hearts and minds as it is today. This puts more weight squarely on the shoulders of manufacturers.

If consumers want more environmentally conscious products and production methods, it’s up to manufacturers to adapt and educate their customers about the changes taking place.

Take for instance the textiles and plastics being replaced by renewable and eco-friendly materials, like mycelium.

Major global brands like Dell Technologies and IKEA have already committed to adopting a Styrofoam packaging replacement made by Ecovative Design.

Indonesian manufacturer MYCL will soon launch a series of sneakers, sandals, wallets, luggage tags, and watch straps made of its mycelium-based leather, Mylea.

The trend has even proliferated into the world of high fashion, with U.S. manufacturers Bolt Threads and MycoWorks aiming to make mycelium-based leather products more widely available this year.

About Encompass Solutions

Encompass Solutions is a business and software consulting firm that specializes in ERP systems, EDI, and Managed Services support for Manufacturers. Serving small and medium-sized businesses since 2001, Encompass modernizes operations and automates processes for hundreds of customers across the globe. Whether undertaking full-scale implementation, integration, or renovation of existing systems, Encompass provides a specialized approach to every client’s needs. By identifying customer requirements and addressing them with the right solutions, we ensure our clients are equipped to match the pace of the Industry.

The most recent escalation of US-China Tariffs has seen a commitment from China to raise tariffs on more than $60 billion worth of goods from the US. The results are already being felt. Most notably, in the US stock market. The Dow Jones Industrial Average has fallen more than 700 points since trading began Monday morning following the announcement that China’s latest round of tariffs will go into effect on June 1, 2019. Additionally, The S&P 500 dropped by 2.6 percent and the Nasdaq Composite fell by 3.5 percent.

US-China Tariffs: A Brief Background

In December of last year, President Trump introduced tariffs on $200 billion in Chinese goods, which resulted in a slight slowdown in the Chinese Economy. With two of the world’s largest economies in an active trade war, fears around the world of a global economic downturn quickly spread. Fortunately, fears were abated by renewed talks between the two countries over the following months. However, the economic ceasefire would soon be put aside as President Trump instated a new round of heightened tariffs on Chinese imports.

US-China Tariffs: The latest Exchange

The Chinese commitment to raise prices on US-made goods followed President Trump’s commitment to increase tariffs on more than $200 billion worth of Chinese manufactured goods last week. That round of tariffs would include more than 5,700 goods subject to as high as a 25 percent tariff, up from the previous 10 percent. Experts believe that the latest US-China tariffs will only make things worse for both economies.

Trump’s duty increase on Chinese exports came following allegations that China had backtracked on its agreement reigning in the alleged theft of intellectual property and pressures to hand over technology to companies manufacturing components in China. Trump has gone so far as to threaten an additional $325 billion worth of tariffs on other Chinese products.

After the most recent developments regarding US-China tariffs, Alec Young, managing director of global markets research at FTSE Russell in New York, stated regarding investor activity, “With the ultimate trade outcome inherently uncertain and difficult to model or predict, investors are selling first and asking questions later. Investors are increasingly worried an anticipated second-half profit rebound may now evaporate as President Trump’s threat to tariff the remaining $325bn in Chinese imports would disproportionately target consumer products like iPhones, thereby posing a greater threat to the consumption-driven US economy.”

US-China Tariffs: Who’s Affected

There are industries across the board that is affected by the ongoing trade war, particularly those incorporating steel and aluminum into their manufacturing operations. Listen firsthand to 12 top executives explain how the trade war has already affected their bottom line as far back as late 2018.

Twelve US execs explain how Trump’s trade war affects their bottom lines from CNBC.

It remains unclear just how the latest round of tariffs will affect small and medium-sized businesses, which cannot as readily absorb cost increases when compared to their larger, conglomerate counterparts. However, based on reports, many are less than optimistic regarding the economic outlook.

About Encompass Solutions

Encompass Solutions, Inc. is an ERP consulting firm, NetSuite Solution Provider, and Epicor Platinum Partner that offers professional services in business consulting, project management, and software implementation. Whether undertaking full-scale implementation, integration, and renovation of existing systems or addressing emerging challenges in corporate and operational growth, Encompass provides a specialized approach to every client’s needs. As experts in identifying customer requirements and addressing them with the right solutions, we ensure our clients are equipped to match the pace of the Industry.

On Monday it was announced that a U.S. Steel and United Steelworkers Union deal has been reached as a “tentative agreement”. The consensus has helped to avoid a steelworker strike that would involve more than 14,000 steelworkers in tubular operations, domestic flat-rolled steel, and ore mining facilities throughout the eastern United States.

a picture of a plant where steel plant a steelworker strike could have taken place if not for recent headway in contract negotiations.

Steelworker Strike Update

Details of the agreement are under wraps while the proposed four-year contract is still under reviewed.

U.S. Steel President and CEO David Burritt released a written statement in which he described the agreement as “fair and in the best long-term interests” as it pertains to U.S. Steel’s and its employees’ futures. Burritt’s stamen goes on to say “Together, we’ve agreed on terms that will create certainty and stability for our many stakeholders, enable our company to implement our long-term business strategy, which includes continued, responsible investments in our people and plants, and position U.S. Steel to remain a leader in the highly competitive global steel industry.”

According to USW Local 1899 vice president Jason Fernandez, Local presidents are returning from negotiations in Pittsburgh and will take time to deliberate with union members on the best course of action. The eventual voting process will be planned to accommodate workers schedules, so it may take up to a week before a decision is made regarding whether to accept U.S. Steel’s proposed contracts or not.

Steelworker Strike Background

Negotiations have been taking place since July, leading up to the September 1st expiration date of worker contracts. Things became heated when it seemed clear that U.S. Steel would not make good on a pay raise that workers had done without over the course of three years in the interest of the company’s future. As company profits reached into the billions over the last three years, workers grew incensed that upper management showed no signs of reciprocation for the hit workers took during the last round of contract negotiations. A steelworker strike was authorized by unions across the eastern US, but never fully enacted.

ArcelorMittal, the largest steelmaker in the US, remains in talks with the USW over contract negotiations and a strike is still possible for the company’s near 16,000 steelworkers.

Steelworker Strike Effects On 2016 Midterm Elections

It has been speculated that the turmoil in the US steel industry will have a significant effect on the outcome of the midterm elections.

While president trump has imposed tariffs on aluminum and steel imports as an effort to drive demand to U.S. producers, not everyone has enjoyed the renewed activity. Jeff Astle, an employee of Universal Stainless and president of Local USW 9531, asserts the contract recently signed by his chapter to be the best he’s seen in 23 years. When asked about what’s changed, he stated, “There was once upon a time I was only working 40 hours a week, barely, but now business is thriving – we are working so many hours it’s not even funny.”

While that may be the case for a veteran of the industry, low-level workers lament that record profits of steel producers, like U.S. Steel and ArcelorMittal, have failed to trickle down. These workers represent a substantial voting bloc for the incumbent and the Republican party. Without the support of these steelworkers, an air of uncertainty hangs looms as the November elections draw near. Talks of walkouts are circling and more than 31,000 steelworkers have granted union negotiators the power to activate a strike that would affect the country’s two largest producers, U.S. Steel and ArcelorMittal. The two companies account for nearly half of all steel produced in the United States.

Material handler at Universal Stainless Henry Polite finds himself between a rock and a hard place, stating “I’m proud to be a steelworker, but I would just like to see more concern for the underdog [the workers], than just the higher-ups.”

The United Steel Workers Union summed up the sentiments of neglected workers in a statement that alleges, “Top company officials have given themselves more than $50 million in pay and bonuses since 2015 while the hourly workforce has not received a wage increase over the same period.”

When it comes to how these resentments could manifest at the polls, Soren Fanning, a history professor at Robert Morris University, alluded to 2016, when the presidential election was all but sold as, ‘we are bringing the steel industry back to Western Pennsylvania, back to America,’. Trump won by fewer than 80,000 votes in the region. Fanning suggests that “People vote their frustrations [And] right now what you’re seeing amongst steelworkers is a real sense of urgency that these promises of better conditions, more purchasing power, more health care get fulfilled and, if they don’t, they are going to go with the party of change.”

About Encompass Solutions

Encompass Solutions, Inc. is an ERP consulting firm, NetSuite Solution Provider and Epicor Platinum Partner that offers professional services in business consulting, project management, and software implementation. Whether undertaking full-scale implementation, integration, and renovation of existing systems or addressing the emerging challenges in corporate and operational growth, Encompass provides a specialized approach to every client’s needs. As experts in identifying customer requirements and addressing them with the right solutions, we ensure our clients are equipped to match the pace of Industry.

USW negotiations continue as representatives report that progress had been made in the latest round of contract bargaining with US Steel. Negotiations between the two entities will continue and a strike will be avoided provided that gaps in asks from union members can be filled in a reasonable timeframe.

Currently, US Steel proposes an additional $145 healthcare premium per month to be used toward healthcare and dental coverage. Representatives for the USW negotiations calculated the lifetime cost to workers over the term of the agreement would total $10,440. The number would eat up the proposed wage increases from the USW and effectively put workers back at square one.

Key issues that remain to be resolved include health and dental costs, incentive pay, supplemental unemployment benefits, and disagreement on the use of a Voluntary Employees Beneficiary Association fund.

A picture of a steel production plant Like those where US Steel workers are considering organizing a strike.

USW Negotiations

US Steel released its most recent contract proposal publicly, which provides:

  • A $3,000 ratification bonus is to be paid within 30 days of contract ratification to employees accruing pension service as of Sept. 1
  • $3,000 bonus to be paid to the same category of employees as of Sept. 1, 2021.
  • Basic wage increases of 4% effective Sept. 1, 2018
  • increases of 3% on Sept. 1 of each year 2019 through 2023.

This marks the 4th consecutive week of contract negotiations between US Steel and the United Steelworkers Union.

Following this week’s announcement that US Steel workers voted in favor of strike approval, ArcelorMittal steelworkers across the region have mobilized in preparation for a strike authorization vote of their own. The vote will take place next week on Monday.

Members will meet with USW leaders at the meetings, where they will receive updates on the expected bargaining process, a rundown on strike rules, review benefits afforded to members during a strike, and, if deemed necessary, pursue strike authorization. A recently released update included the statement, “If significant progress is not made by early next week, we will return home to deliver detailed reports at membership meetings and seek your support for a strike authorization.”

If the strike is approved, the United Steel Workers Union members at ArcelorMittal locations throughout the United States could join US Steel steelworkers in a complete work stoppage in the event contract negotiations fall apart. USW officials and steel companies have been in contract negotiations for months leading up to the workers’ September 1st contract expiration date.

ArcelorMittal Steelworkers Unsatisfied With Proposed Terms

ArcelorMittal has earned the ire of steelworkers, who have not received a pay raise in three years, for proposing concessions that include hits to supplemental unemployment, incentive, vacation pay, hot-rolled steel bonuses, and health care. Union representatives communicated that these concessions could result in as much as an additional $8,000 per year in out-of-pocket health costs for the affected families.

a picture of steel rods like those produced by ArcelorMittal Steelworkers.

US Steel released its update on Wednesday of this week, saying, “We have submitted a revised proposal to USW leadership that reflects the ongoing dialogue during our most recent round of negotiations. The revised six-year proposal, which we strongly believe is in the best long-term interest of all U.S. Steel stakeholders, includes a 14% base wage increase over the term of the agreement, guaranteed profit sharing, and healthcare premiums offset with transition payments.”

Currently, U.S. Steel, ArcelorMittal, and workers are operating under contract extensions.

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