Skilled metal workers measure, stamp out and weld together restaurant kitchen fryers, griddles, boilers, warmers, cabinets, tables, ice machines and steamers.
When the second shift gets off at , union workers can collect their
bags of company subsidized rice and ride a company bus about 40 minutes north
With 10 percent of the population working abroad and half the population living on less than $2 a day, many Filipinos hope jobs like these at Elgin-based Middleby will revitalize the economy.
One need only visit Philippine rice and sugar cane fields
to see the chasm between the old world and the globalization at work in
The country’s economy is a patchwork of contrasts.
Yuppies drive through neighborhoods of abject poverty to get to the malls.
UPS and FedEx fly out of former
Bridging the chasm between the old and new economies, foreign investors such as Middleby employ workers and import technology .
Since bottoming out after the Asian financial crisis in
The 100,000-square-foot factory employs about 200 full- and part-time workers and is considering more hires.
Overall, The Middleby Corp. sales rose 12 percent in 2004, to $271 million. Profits rose 26 percent, to $23.5 million.
However, it took some creative thinking in
Jobs home or abroad
An Asia Development Bank survey of 102 countries ranked
Nevertheless, almost half its 86.2 million people are under 20 years old and are proving eager to adapt to non-traditional ways of making a living.
Already they are crowding into malls and working nights
at call centers in
Still, a deep divide exists between middle class and wealthy urban youth and those mired in poverty, working the rice fields or fishing for a living.
Whether this emerging generation will be able to stem the tide of migration with good jobs at home is the critical question asked by Philippine economists.
The sales force at Middleby in
However, manufacturing engineer Ricky Malaca,
27, has been working for Middleby for four years. He says an above-average
wage won’t stop him from leaving the
“Most of my friends want to go abroad,” Malaca says on the factory floor. “The
The Philippine version of Ronald McDonald is Jollibee’s mascot, a rotund cartoon bee with a chef’s
hat. In the
Jollibee, along with its Chinese and pizza fast-food affiliates, is doing something no other major chain has been able to do: beat McDonald’s at its own fast-food game.
And Middleby is Jollibee’s biggest supplier of kitchen equipment.
“Their strategy was, for every McDonald’s, they would
open two Jollibees nearby,” said Sam Sidani, general manager of international operations for
The popularity of Jollibee sometimes seems to border on the nationalistic. Their prices, food and promotions are similar to McDonald’s, but Jollibees appear more packed.
Jollibee has Kids Meals, Value Meals and toy giveaways. When Jollibee started to take off, McDonald’s modified its menu to include Jollibee favorites, including McSpaghetti, fried chicken and rice. And “American Idol” finalist and Filipino-American Jasmine Trias is seen more often on McDonald’s commercials these days than Ronald McDonald.
Sticking to what made it successful, Jollibee has built more than 1,000 restaurants and its chief executive Tony Tan Caktiong was named Ernst & Young 2004 World Entrepreneur of the Year.
Jollibee is taking aim now at China and Middleby is scouting factories there, too.
Still, the Jollibee phenomenon was not the whole reason for Middleby’s comeback in the Philippines.
Oak Brook-based McDonald’s once generated 70 percent of Middleby’s sales. But when it slowed new restaurant construction to a trickle after the Asian financial crisis of 2000, Middleby’s managers had to brainstorm for solutions.
Middleby was able to fill the gap in Asian demand with U.S. orders — until Jollibee came charging into the fast-food void.
“We found ways of creating capacity for that plant, not taking capacity away from U.S. plants,” said Sidani, who quarterly makes the 22-hour journey from Elgin to Santa Rosa to check on operations.
It also helps that Middleby is in an “economic zone,” in Santa Rosa along with other U.S. companies such as Northfield-based Kraft Foods. Foreign companies pay no tax on imports if 70 percent of their product is for export.
Consequently, Middleby can afford to pay its average worker about double the national minimum wage, paying about $1 an hour.
As an example of what that buys, consider this: A fast-food lunch in the Philippines costs about as much as it does in the United States, about $3.50. That’s nearly a half-day’s work there.
In Elgin, union factory workers make about $16 an hour.
Despite the lower wages paid in the Philippines, executives are quick to say employment in the factories there has not cut U.S. employment.
In the meantime, the fast-food market is good for the Elgin company as a wide range of fast-food restaurants are appearing in the Philippines. They are quickly overtaking the lower-fat, traditional Philippine rice-based diet.
Filipinos are developing an American-style taste for fast food.
And a quick glance around the average Jollibee often reveals what their newly developed taste is doing to their waistlines.