July 25 , 2000

Joint New Jersey Effort Proves to be a Y2K Success

Newark – The Year 2000 problem was predicted to force the closure of 7% of small businesses according to the US Small Business Administration. Particularly vulnerable were the small and mid-size manufacturers in NJ. New Jersey has close to 13,000 manufacturers, the ninth highest concentration of manufacturers in the nation. If the 7% statistic held true, approximately 1,000 manufacturers could have closed and 50,000 jobs lost. The economic impact of such a loss would be devastating to New Jersey.

To address this issue, the New Jersey Manufacturing Extension Program, Inc. (NJMEP) developed a Y2K Compliance training program to assist small and mid-sized manufacturers assess their Y2K compliance. A grant in the amount of $259,200 came from the New Jersey Department of Labor, with added support from the National Institute of Standards and Technology. NJMEP partnered with New Jersey’s County Colleges and the New Jersey Institute of Technology to train manufacturers on how to identify the most critical aspects of their operating system.

Through an independent survey of manufacturers that participated in the Y2K Compliance program, over $225,000 was saved on unnecessary investments, 829 jobs were retained, $861,000 in new sales was created, and over $7 million in retained sales was reported by the manufacturers. The manufacturers also stated that they had a cost savings of over $780,000. This impact data, as of June 19, 2000, was entered into the Economic Impact Model of the New Jersey Commerce and Economic Growth Commission, which resulted in an economic impact of $80 million and an employment impact of 346 jobs in the State of New Jersey. This cooperative effort of the county colleges, New Jersey Department of Labor, New Jersey Institute of Technology, and NJMEP produced a positive impact on the State of New Jersey.

“The largest impact from this project was that we were unscathed because of Y2K and did not have to build up inventory for safety stock”, stated John Tracy, Plant Manager at Burns-Ricker, Inc. If they had to manufacture safety stock, this would be an extra $600,000 - $700,000 of inventory, which would be above and beyond what they typically have on hand.

KDI Triangle projected a loss of $2 million in sales if they did not check for Y2K malfunctions. Some of their clients required them to be Y2K compliant before they would place orders. Kevin Forrestal, Senior Design and Facility Engineer, stated, “This project brought a great awareness of other types of equipment that may have been effected other than computers, which in return made us investigate the equipment and, in some cases, replace it.” As a result of researching the equipment, Kevin Forrestal found that there was a need to replace equipment, that prior to this project he was unaware that this type of equipment may have Y2K malfunctions.

If you are a small or mid-sized manufacturer in New Jersey and you are in the need of assistance or would like an overview of NJMEP, please call 1.800.MEP.4MFG, or visit their web site at www.njmep.org.

Top of page.     Previous Page.