A Tax Reform Success Story in Brooklyn Park
I had the opportunity last week to visit Diversified Plastics, Inc. in Brooklyn Park, a sophisticated manufacturer of high-quality, custom plastic injection molded components and assemblies used for a host of other products. Diversified employs about 80 Minnesotans total, about 65 of them full-time.
It’s the kind of firm in the Twin Cities area that’s providing good-paying, quality manufacturing jobs for a wide variety of skilled workers. I had visited Diversified about a year ago, as Congress was debating the tax reform law. What I learned when I returned recently is that like many Minnesota job creators, it’s a tax reform success story.
Diversified’s leadership was particularly concerned about changes in tax reform to what’s called an Employee Stock Ownership Plan (ESOP). ESOPs give employees of all ranks and seniority an ownership share of the company they work for. They’re both a great way to give an employee a stake in the success of their employer, and to help families prepare for retirement in the future.
Because of tax reform, Diversified told me the values of their ESOP plans were up between 8 and 10 percent, on average from $2,000 to $5,000, already. This is money that families of Diversified’s employees can immediately begin to stash away in a nest egg for the future.
They’re also seeing the more traditional benefits of tax reform: their sales are stronger, and their orders are growing. They’re also expanding their facility, investing in a whole new “clean” wing of their building with new equipment to accommodate highly-specialized clients.
Of course, they’ve had to hire more workers to keep pace, and they’ve added 7 employees this year. Diversified’s leadership says they’ve boosted starting wages twice already to attract the skilled talent they need.
This is how it’s supposed to work: A strong economy with robust growth drives more hiring and higher wages.
It’s a good example of how Minnesota families are better off now as a result of tax reform.