MCALLEN, Texas – The coronavirus pandemic caused the loss of 350 jobs at GE Engine Services-McAllen, a local economic development leader has announced.

Keith Patridge, president of McAllen Economic Development Corporation, spoke about the job losses at a recent board of directors meeting. Among those at the meeting was Liz Suarez, director of aviation for the McAllen International Airport.

“Of course, Liz understands what has happened in the aviation business. Planes that are parked don’t need engines repaired and so as a result their (GE Engine Services) business is off over 60 percent. They ended up letting about half of their workforce go, companywide,” Patridge said.

“We lost about 350 jobs, many of them were through retirement or attrition. Most of it through retirement here but then there were some that were let go.”

Keith Patridge

According to a WARN notice filed with the Texas Workforce Commission, GE Engine Services-McAllen started laying off at least 257 employees from June 12. Officials at GE cited the “impact of the COVID-19 emergency” and the government’s shutdown orders as reasons for the job reduction.

GE Engine Services-McAllen provides jet engines and components for aircraft, and distributes its products internationally.

It is not all doom and gloom for the Rio Grande Valley economy, however. Patridge also reported that McAllen EDC is close to securing a new company for the region. The unnamed firm will be hiring 380 employees with salaries starting at $40,000 to $50,000.

Another project MEDC is chasing sees McAllen in competition with San Antonio, Houston and Oklahoma. 

In his overview of the manufacturing sector during the pandemic, Patridge said most maquiladora managers were able to continue working because the work of their companies was deemed essential by the government. 

Patridge said companies on the U.S. side of the Rio Grande were operating at about 60 percent capacity while those on the Mexican side were operating at 50 percent. The reason for this, he said, is that there is still a lack of parts due a disruption in the worldwide supply chain, and a lack of product demand.

Patridge said he was also pleased to report that UT-Rio Grande Valley has been able to provide COVID-19 testing equipment to maquiladora plants in Reynosa.

Site Selector Survey

In his president’s report, Patridge spoke at length about a new site selector survey sent to him. The survey showed that most call centers have had their workers working from home. The interesting development, Patridge said, is that working from home has led to productivity going up. He said this has big implications for building site requirements in the future.

The site selector survey said a more regionalized approach to supply chains was gaining popularity. Patridge said this has occurred because of a disruption in supplies from China. Now, the survey said, there is a demand for less inventory with more of an emphasis on speed-to-market. “The Amazon model,” Patridge called it.

Developing Anzalduas International Bridge as a state-of-the-art port of entry will help McAllen compete in the speed-to market-arena, Patridge said.

Another interesting part of the site selector survey, Patridge said, was an emphasis on advanced manufacturing and material science skills. “As they (companies) start looking at localizing supply chains, it means they are going to need more materials people and more people that understand supply requirements.”

Patridge said on this front the region has some good educational programs at UTRGV and South Texas College. “We need to enhance those and support them.”

The survey also said artificial intelligence and automation are going to be increasingly important. 

“The reason for AI and automation? Machines don’t get sick,” Patridge said. “If you are in a situation where you have a plant where you can’t do the social distancing, they are replacing those positions with robots or automated equipment.”

Patridge said STC has been a leader on automation. “They have probably one of the best automation, robotics, programs that I know of, anywhere,” Patridge said. “We need to further enhance that.”

Telecommunications infrastructure and security was also flagged as important in the site selector survey, Patridge said.

“That is something I know that the (McAllen) mayor (Jim Darling) has been working on for a long time,” Patridge said. “The whole issue of 5G, the whole issue of the access to high speed Internet. That is something we as a community have to focus on in order to be competitive.”

Patridge said that as the Valley starts seeing cell centers moving their employees to a work from home environment, the need for good broadband connections becomes even more crucial.

“If you have an employee that doesn’t have access to the telecommunications service or high speed data lines, how are they going to work from home?” Partridge asked. “That is probably one of the most important infrastructure issues we need to address.” 

Editor’s Note: The main image accompanying the above news story is a stock photo from GE Aviation.

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