This western Michigan wonderland of tulips and Delft`s blue china has become an economic development role model for other cities its size.
Chamber of Commerce President Louis Hallacy II has a specially made pair of wooden shoes with golf cleats in his office as a reminder of this city`s Dutch heritage; but he needs track shoes to keep up with its burgeoning economy.
Consider:
– The unemployment rate here is 3.5 percent, about a third of the Detroit rate and less than half of the statewide Michigan and Illinois rates.
– At the low point of the 1982-`83 recession, while Michigan endured a 17.3 percent jobless rate, the rate here was 9 percent.
– For at least the last two decades, local tax revenue has consistently grown at 5 to 8 percent annually in this city of 26,000.
”I don`t think we`ve had a major downturn here in 20 years,” Hallacy said. ”The secret is the diversity of our industry. Industrial growth has been gradual, largely by design. The area is not dependent on a few major employers and never has been.”
Over the years, Holland has pursued a policy of building on the growth and expansion of existing businesses rather than hustling to attract new industries. It also has avoided developing too close ties to Michigan`s automotive industry.
The city has 290 industries, employing from 30 to several thousand workers. Its diverse industrial base ranges from light manufacturing through phamaceuticals, office furniture, food processing, soft drink bottling and pleasure-boat yards.
”That has been our formula for success,” said Mayor William A. Sikkel, a recently retired real estate broker who works closely with Hallacy, a former three-term mayor who has headed the chamber of commerce since 1981.
Holland has created an environment for some remarkable business success stories.
G.W. Haworth, the 76-year-old chairman of the office furniture manufacturing company that bears his name, began the business in a Holland garage in 1948 while he was a high school industrial arts teacher.
By 1975, the firm had grown to $14 million in sales. This year, revenue is expected to exceed $450 million.
With 2,700 employees working three shifts, the firm occupies 192 acres in a Holland industrial park; has satellite plants in California, Pennsylvania and Canada; and ranks third in the office furniture system industry. It is Holland`s largest employer.
”There is a work ethic in this community that you find in few other areas,” said William A. Sikkel, senior vice president of the company who is a cousin of and shares his name with Mayor Sikkel.
”People make a career of their jobs. They stay with a company and develop a sense of loyalty and craftsmanship.
”In my career, I worked for three different companies in this area before coming to Haworth. One of them moved South for cheap labor. And that`s exactly what they got. Quality and production went down. Costs and absenteeism went up. And they had to move back North about 15 years ago.”
The seeds for the area`s quality of life-sparkling Lake Michigan waters, sandy beaches and lush forests-were planted in the Ice Age.
But it was nurtured by Dutch immigrant farmers who settled here in 1847, bringing with them the work habits that permeate the culture.
”The strong Christian upbringing and moral standards of that heritage combine to create a dedication to hard work and loyalty to employers that is unique,” Hallacy said.
By capitalizing on Old World traditions and nostalgia, residents also have built a tourist industry that attracts nearly 3 million visitors annually. Holland offers the lure of such Dutch curios as wooden shoes, a more than 200-year-old windmill imported from the Netherlands and a glorious spring tulip festival.
Together, these attractions add more than $100 million a year in income to Holland and its coastal neighbors.
Patrick A. Thompson, president of Trans-Matic, a metal stampings firm, is a former Chicagoan whose small business has found fertile ground in this corner of western Michigan.
Thompson surveyed locations in southern Indiana and along Wisconsin`s shore before selecting the Holland area as a plant site.
”I did a lot of homework,” Thompson said. ”We`re a high-skill company and (employee) turnover would kill us. I needed an area where people were educable and had a sense of loyalty.”
Thompson was 27 when Trans-Matic opened here in 1968 to generate $51,000 in sales. In 1985, Thompson was named Michigan`s Small Business Person of the year. And this year, the firm, with 120 employees, is expected to top $10 million in revenue.
”People here have a very unique value system,” he said. ”Our company has a long training cycle that takes four to six years to develop competent journeymen.
”We can make a large investment in training a work force and know that the investment will pay off in the future. Our human resources department doesn`t even measure turnover, it`s so negligible.”
Former Chicagoan Jud Bradford`s family vacationed in western Michigan for years before opening a branch of its specialty packaging business in Holland in 1951. In 1969, the Bradford Co. severed its ties with other partners and moved all manufacturing operations here from a plant on South Ashland Avenue in Chicago.
”West Michigan is one of the state`s best-kept secrets,” said Bradford, the firm`s chairman and president. ”When you think of Michigan, you think of the Detroit metropolitan area. But it`s far more than that.
”A lot of the (area`s) success has to do with the nature of the people, not just the employees, but management as well. You find people here working just as industriously in low periods as well as peaks.
”I`m very proud of our machinery, engineering and products. But visitors invariably say, `It`s the cleanest plant in the industry, and I didn`t see anyone who wasn`t working.` What grabs them is the pace and flow of the work force.”
Historically, the emergence of industry as a major economic force in Holland dates to the early 1950s when the General Electric Co. opened a plant to manufacture air conditioner and refrigerator electric motors here, Hallacy said.
Until then, the area had been known principally for blueberries, dairy farming and vacationing Chicagoans.
In 1962, business leaders created the Holland Economic Development Corp. to assure that land would be available for future growth.
By 1964, Holland`s South Side Industrial Park was opened on 100 acres with a Life Savers plant as its first client. Since then, the park has grown to 400 acres occupied by 52 industries employing more than 9,000.
Now, a second, 300-acre industrial park is being opened on the city`s North Side to accommodate growth into the year 2000, Hallacy said.
Interestingly, a 1985 application for a $400,000 federal grant to help bankroll infrastructure in the new park was at first rejected by state authorities because Holland was deemed ”too affluent,” Hallacy said.
That stance later was amended after a study showed that two local manufacturers drew 50 percent of their new workers from neighboring high unemployment areas.
”We`re constantly hearing vibes that people in Lansing (Michigan`s state capital) are calling us the Gold Coast,” Hallacy said. ”We`ve been very successful.”
Jim Karshner, a spokesman for Doug Ross, Michigan`s director of commerce, wouldn`t go that far in characterizing Holland`s economy. But, he said: ”It is an area that doesn`t need a lot of state assistance. They`ve pretty much done it on their own. They have great diversity. It`s what we`d like the entire state economy to look like.
”The companies over there are quality companies that take care of their employees. They`re innovators. And they have an excellent work force and work ethic.”
Over the years, Mayor Sikkel said, many major prospective employers have been discouraged by local officials from moving facilities here because of Holland`s determination not to become dependent on a single, major industry.
”We had the luxury to make that judgment,” he said, because of the area`s diversity of employers.
”We considered smokestack industries and decided that the city`s future lay with a lot of smaller enterprises,” Hallacy said.
”Holland will continue to grow. It has all the amenities-ample recreation and water, a great work force, even a city-owned electric utility with rates 20 to 25 percent less than those charged elsewhere in the state,” he said.
In the meantime, to guarantee that its diversity of employment continues, the city`s business leaders have sent promotional materials to numerous Midwestern firms they believe would fit into Holland`s successful small entrepreneurial mode.
