Business - Business News

POSTED: Sunday, Oct. 18, 2009

After 125 years, Morse Steel relies on experience of its employees

BELLINGHAM - While his surname is synonymous with longevity in the Bellingham business community, Mike Morse chuckles when asked how he runs a 125-year-old company.

Morse has been president of Morse Steel Service for almost eight years and is the fourth-generation owner of a company that has continuously been in operation in Bellingham since 1884. However, he'll check in with his more experienced employees when trying to improve the company, several of whom have more than 40 years experience at Morse Steel. "How can you say I run the company, when I'm the one still asking questions?" he said with a laugh. "My role here is to remove barriers for employees to make this company better. None of the good ideas come from me."

The company processes and delivers a variety of steel products across the Pacific Northwest. Last year, the company worked with 60 million pounds of steel.

While light-hearted about what he does, Morse also will admit it's been a challenging time, requiring quite a few tough decisions because of the recession. Earlier this year the company had to cut its workforce by 12, leaving a workforce of 40 in Bellingham and about 10 in its new facility in Moses Lake.

"It (the layoffs) was gut-wrenching on two levels," Morse said. "Telling the employee they no longer have a job is the worst part. But on another level, I know I'm losing someone this company worked hard to get and keep. No longer having that talent hurts the company."

It's been a case of contraction and expansion for the company. The new 57,000-square-foot facility in Moses Lake was completed earlier this year, allowing the company to serve customers on the east side of the state as well as create some flexibility when processing material. When dealing with something as heavy as steel, transporting it farther than a couple hundred miles doesn't make sense, Morse said.

"The new facility is a way to better handle inventory," Morse said. The 52,000-square-foot Bellingham facility near Bellingham Technical College has been in operation for 40 years and now houses all the company's Bellingham operations.

Production at Morse Steel is around three areas: Plate products, which involves cutting steel to specific sizes and shapes; rebar for the construction industry; and linear material, such as tubing. Morse said having experienced employees is key when it comes to cutting steel.

"It's an art; employees are looking at the chemistry involved and continually make adjustments with the torch to get the cut right," Morse said. "You need good people to do that."

Employees stay with the company for so long because of the variety of work and the work environment, said Jim Ahrens, vice president and general manager of the rebar division. He's been at the company for nearly 42 years, working for three generations of the Morse family. He said the attitude from the Morse family has been consistent: Employees work with them, not for them.

"There are the little things, like referring to everyone as co-workers or fellow employees, that is good to hear," Ahrens said.

CHALLENGING YEAR

Steel is a relatively cheap commodity unless the economy falls into turmoil, as it did last year. In the first half of 2008, steel was being purchased at about 40 cents a pound; like many commodities, it increased increased dramatically in the fall of 2008. By the third quarter the price of steel was around 80 cents a pound, then the financial meltdown hit the stock market. By the beginning of 2009, it was under 40 cents a pound.

"It was a crazy year for the steel industry, and not knowing what would happen to the price was no fun for anyone," Morse said.

Once the fluctuations ended earlier this year, Morse Steel and other companies have had to adjust to the slowdown in construction and manufacturing. Morse said they were fortunate to land some significant rebar projects earlier this year, including the Bellwether Gate project, but the rebar division is expected to be slower than usual heading into the winter months.

"Overall we see some signs of life, but we don't see the tide rising yet," Morse said. "I would love to be surprised, but I think this is a longer-term issue. While it's slow, we'll continue to take a look at the basics, to look for ways to become better."

Which means Morse will be consulting more with the employees.

"There have been a handful of Morses involved with this company, but there have been hundreds of employees over the years that have made it successful," Morse said. "They have already given me suggestions to improve efficiencies that come from working here a long time. It may be just a matter of shifting a machine around, but it makes a difference."

MORSE STEEL HISTORY

1884-1920 - Founded by Robert I. Morse, who came to Bellingham from San Francisco and used $3,000 to open a hardware store.

1920-1958 - Operated by Cecil Morse.

1958-1975 - David Morse, the youngest son of Robert I. Morse, took over in 1958 and added the steel distribution part of the business.

1975-2002 - Operated by Bob Morse.

2002 - Present - Mike Morse.

SOURCES: Morse Steel Service, The Bellingham Herald archives