MUSCATINE, Iowa — HNI Corporation, which is the parent company to the Muscatine-based office furnishing supplier HON, has revealed challenges surrounding labor and supply.
In a business update on Thursday, Sept. 23, HNI said that despite seeing "strong order trends," they've struggled with labor availability, the supply chain, and cost inflation.
"As the third quarter has progressed, the Corporation has seen additional challenges, including greater port congestion and increasing COVID-19 cases in its facilities," read the statement. "These new challenges when combined with continued staffing shortages, both at HNI internally and at its suppliers, are limiting production capacity growth."
HNI said that their upcoming plant in Mexico, which was announced in early September, is incorporating more automation to cut down on labor needs, which would help combat these issues. The plant in Mexico is set to employ around 250 people.
Read the full statement from company CEO, Jeff Lorenger:
“First, I want to thank our dedicated members who are working harder than ever as we manage through unprecedented challenges to meet the needs of our customers.
“Labor shortages and supply chain disruptions are well documented, and we are not immune to these pressures. With this in mind, earlier this month we announced plans to open a new seating manufacturing plant in Saltillo, Mexico in 2022. While the new facility is an important addition to our North American footprint, we remain focused on increasing staffing levels and capacity at all our other manufacturing locations in North America.
“As we look to 2022, we see significant opportunity. Our competitive positions continue to improve. Both the new construction and remodel-retrofit markets in Residential Building Products remain strong—supported by an undersupplied housing market. The Workplace Furnishings market recovery is underway and growing. We have taken and will continue to take pricing actions to help offset the inflationary pressures we are absorbing in 2021, and we will begin 2022 with an elevated backlog. There is much to be optimistic about as we look forward."