Guest Editorial: Small Shipyard Grants Are Strategic Investment
By Dave Matsuda
Over the last 14 years, the U.S. Maritime Administration’s (MarAd) Small Shipyard Grant Program has served as a steady source of funding for capital projects and workforce training programs in small shipyards nationwide. With the signing of the FY2022 federal appropriations bill by President Joe Biden on March 15, this important program will continue.
Why does this program matter? By partnering with dozens of shipyards each round, MarAd supports upgrades for needed, outdated or inefficient equipment, as well as skills development and training. The Small Shipyard Grant Program also helped play a role in the economic recovery in 2009 by funding projects with long-term positive impacts. Each year in which additional grant resources are available, dozens of small shipyards can improve service capabilities and operate more efficiently. In fact, many of these projects are case studies in operational efficiency, demonstrating how skilled workers and the right equipment can align to improve ship construction and repair processes.
For example, in 2021, MarAd awarded Heartland Fabrication, a shipyard located on the Monongahela River in Brownsville, Pa., about $1 million for a new made-in-America robotic welding system. Heartland has made impressive efforts to develop its workforce, including an onsite training facility, and the new welding equipment will provide jobs for those seeking a high-tech career in robotics. This new system will allow them to make the best use of the workforce they currently have, but also operate in a way that allows them to meet the growing demands of their customers.
While serving as administrator of MarAd, I was privileged to visit many of our country’s small shipyards and the American manufacturers supporting this industry. I enjoyed learning about the variety of the markets each serves, the innovative ideas they’ve implemented and the constantly evolving technologies that continue to change the way the sector operates.
A few notable (and grant-eligible) trends are impacting this alignment between workforce development and equipment/technology. First, the digital age is ushering in more sophisticated equipment and technologies, making things “smart” and connected, while requiring different skillsets to operate them. The robotic welding system I mentioned is one example of how grant applicants are leveraging the program to meet these changes.
Generational preferences are also evolving significantly from Boomers to Gen X to Millennials to Gen Z. I have noticed it primarily in their desired work environments, but also in the desired skillsets (both employer and employee). Changing preferences are creating a skills “mismatch” between many traditional occupations and the available workforce. A number of shipyard managers have told me it was the lack of available skilled workers that dictated changes in their processes or equipment purchases. And we have also seen that in some of the Small Shipyard Grant project applications.
Finally, climate change’s impact on the maritime industry as a whole is spurring a new drive toward renewable energy solutions, or at least less-polluting ones. Technologies that reduce air emissions like hybrid-electric power, hydrogen, LNG and battery-electric are all creating innovative projects. Additionally, technologies that reduce water pollution like wastewater collection, treatment systems and washdown pads are increasingly requested through the grant applications.
Grant Notice Coming
Now that the federal appropriations bill has been signed into law, look for MarAd to issue a grant notice by month’s end, with an application period of about six weeks. The grant notice will provide details on how to apply. Shipyards that have been paying attention to this program are in a position to plan ahead, by considering potential projects well in advance of this notice.
The small shipyards across the country construct, refit and repair more than 40,000 working military, safety and commercial vessels in the American-flag fleet. Their work helps to connect people with essential services and transport a large amount of the U.S. energy supply, as well as other important commodities. Given the complexity of challenges faced by small shipyards today, the Small Shipyard Grant Program will continue to be needed to help construct and maintain the fleet of tomorrow.
Dave Matsuda is a principal at Matsuda & Associates, LLC, a transportation consulting firm in Washington, DC. He served as U.S. Maritime administrator from 2010 until 2013.
