Dave Niekamp says the town of Annaheim “wouldn’t exist” if it wasn’t for Doepker Industries, a highway trailer manufacturer in the small prairie town northeast of Saskatoon.
It’s not just because the company employs 200 people in a town of only 220. Niekamp, a process manager and 37-year veteran of the company, says Annaheim has faced growth challenges since German immigrants established homesteads there more than a century ago. The town was settled 15 kilometres from the nearest main road, and there was no rail connection, a common feature in area towns at the time.
Nowadays, Annaheim is still a small place that depends on nearby communities like Humboldt for essential services like a hospital and grocery store, but it’s mostly self-sufficient with a school, hotel, pub and restaurant because of Doepker’s presence.
“The town wouldn’t have grown without the company. It’s pretty significant that a small place like this has a K-12 school,” says Mr. Niekamp, noting the many young families with parents employed at Doepker.
Annaheim is one of Canada’s few remaining “company towns,” places where locally owned small- and medium-size businesses are the primary employer and wealth creator. In fact, this region of Saskatchewan – once referred to as the “Iron Triangle” for its cluster of towns with metal manufacturers – has many such towns, which is unusual in an economic development climate that stresses diversification and small-business growth as keys to reviving small-town economies.
Michel’s Industries employs about 80 people in the nearby town of St. Gregor (population 120). Schulte Industries has 150 employees in Englefeld, a town of 300. The regional cluster is one of the main reasons the companies in these one-industry towns continue to grow. The common labour pool helps solve their main obstacle to growth: the attraction and retention of a skilled work force.
Dave Doepker’s father and uncles started Doepker Industries in 1948 after growing up on a farm and deciding to start manufacturing equipment to serve the local farming community. They subsequently began making highway transportation trailers, which they now do exclusively. The company primarily serves a national market, and produces trailers for a variety of industries, including farming, forestry, and oil and gas.
As it expanded its product lines and deepened its market penetration over the decades, Doepker discovered its greatest strength was also its greatest weakness – its work force.
“Being in a rural community is both a blessing and a curse,” says Mr. Doepker, who owns the company along with two family members. “You get good, strong, loyal employees. [But] when you go into a growth mode, it’s hard to find new employees.”
This presented the company with a challenge when it sought to expand in the mid-1990s. The solution: open a plant in Moose Jaw, which is about 250 kilometres south of Annaheim. In 2006, Doepker’s grew again, opening another facility 150 kilometres away in Saskatoon.
Doepker has tried other ways to expand its employee base, including recruiting employees from overseas. Many years ago, more than 30 people came from South Africa; the company is now trying to bring up to 30 people from the Philippines. “If we can’t find the skilled labour we need to get it from other countries,” says Mr. Doepker, who cites the need for welders and industrial painters.
Not all of its strategies have required the company to look so far afield. Facing another employee shortage in 2000, the company put out a call to women in the area to join what was until then a male-dominated work force. The company offered them a welding training program, and many women were subsequently hired. Fifty per cent of the Doepker’s workforce is now female, says Niekamp.
“It was accepted easily,” says Mr. Niekamp of the culture shift that took place. “We just had to get the word out to women that the opportunity was there.”
Doepker is one of purest examples of a “company town” in this region. Michel Industries, on the other hand, a company which manufactures tarps that cover trucks and trailers, employs only a handful of people from St. Gregor itself; the rest come from Humboldt, about 10 kilometres away.
“There are a lot of retired people in St. Gregor,” says company owner Bud Michel, “so we hired people within a 50-kilometre radius [of the town].”
Most companies avail themselves of the regional supply of employees in the Iron Triangle. Forty per cent of Doepker’s employees also come from Humboldt, which is only 25 minutes away by car. This is both good and bad for business, says Mr. Doepker, who lives in Humboldt himself.
“There’s a lot of metal manufacturing that goes on in this particular area,” he says. “Again, it’s a blessing and a curse. The blessing is there’s a critical mass so people can move to the area, and if there’s a slowdown in one of the industries they can always go get a job in another one. The curse is everyone is pulling from the same pool. We’re all looking for painters, engineers and welders.”
Mr. Michel echoes this sentiment. “If you’re welder, you’re going to find a job [in this region],” he says.
The towns used to be more independent. Mr. Doepker uses a sports analogy to illustrate how things have changed over the decades. Each community used to have its own hockey teams. Nowadays, youth from two or three towns play together because there aren’t enough of them to assemble teams in each age group. This regional focus extends beyond the world of sports with shared services such as economic development and healthcare.
“Now the rivalry’s gone and we’re joined together,” he says. “That’s good.”
The firms still have strong attachments to their host communities. They help fundraise for rinks and schools, and sit on the boards of area boards and commissions. Dr. Lloyd Steier, a University of Alberta professor and specialist in family business issues, says community building is an essential part of doing business in a small town, especially for employers that rely on a deep labour pool. Prospective employees want good schools, hospitals and other amenities, and businesses need to help deliver them.
“[Getting involved] is altruistic, but it’s also self-serving,” says Dr. Steier. “You have to make an investment in the community.”
Across Canada, there are other towns like St. Gregor and Annaheim, but it’s increasingly rare as more small- and medium-sized companies go out of business or get absorbed by multinationals. Many small towns are also trying to diversify their economy so they’re not reliant on one company to create wealth and employment, says Jeff Dixon, a business professor at Queen’s University.
Dr. Dixon’s research focus is eastern Ontario and he couldn’t think of any towns that still had one dominant business. “They’re not ‘smokestack chasing’ anymore,” says Dr. Dixon, referring to the age-old strategy of trying to recruit large employers that employ hundreds.
Instead, they’re focusing cultivating many entrepreneurs that start businesses that initially employ only one or two people at the start, something he refers to as the “economy of the ones and twos.”
Going back 60 years, this is the story of firms like Doepker – small-scale entrepreneurs that eventually grew companies big enough to support entire towns. Now, Doepker is outgrowing the town, forcing it to expand its activities and grow its employee base elsewhere. The plant in Moose Jaw employs 140 people; the one in Saskatoon has 60 employees.
Despite the growth possibilities in bigger centres, Mr. Doepker says his company is committed to Annaheim.
“It’s our home,” he said. “A lot of our families live here and always have. There’s a connection to this community, and I don’t think we’ve ever thought of breaking that connection.”
Special to The Globe and Mail
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