Perham firm finds a passport to a booming economy

  • Article by: JENNA ROSS , Star Tribune
  • Updated: August 3, 2014 - 6:07 PM

Struggling to fill positions, fast-growing KLN Family Brands hires workers from overseas.

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Vitalii Kovbasiuk, left, and Slav Makukha and Karina Babanina, right, are among KLN’s Ukrainian workers.

Photo: Photos by DAVID JOLES • djoles@startribune.com,

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In the darkness, a dozen men and women climbed onto a yellow school bus for a 24-mile trek to the Barrel O’ Fun factory, where they donned green hairnets to start the night shift. But their journey to work had already spanned thousands of miles.

More than 60 people, mostly from Ukraine, are arriving in little Perham this summer as new hires at the snack food manufacturer, in an experiment that shows the challenges of recruiting entry-level workers in rural Minnesota’s growing economy. Minnesota boasts one of the lowest unemployment rates in the country, and employers face a special challenge in this part of the state, where they are now competing with North Dakota’s booming oil fields.

“Three, four, five years ago, there were a lot more people who were anxious to take anything,” said Steve Hine, a state labor market economist. “That’s changing. … Companies really have to attract workers now.”

KLN Family Brands, the fast-growing parent company of Barrel O’ Fun and other snack brands, employs more than 1,300 people in Perham, population 3,000. Given the chance, founder Kenny Nelson would hire 100 more.

But nearby companies are growing, too. Perham’s employers created nearly 1,100 jobs in the past decade, state data show. Manufacturing jobs alone nearly doubled during that time.

“We’ve tried everything — veterans, homeless shelters, job fairs,” said Nancy Belka, KLN’s human resources director, plus billboards, newspaper ads and radio spots.

Now, for the first time, the company is trying international workers. The dozens of men and women, most of whom are in their 20s, nabbed special seasonal visas to take jobs that pay $11.79 an hour, filling cardboard boxes with bags of chips and snacks.

At a recent orientation, several said they are grateful to escape the fierce battles in eastern Ukraine for better-paying jobs in small-town Minnesota. When a manager mentioned overtime, the room broke out in applause.

“We will save money — as much as we can,” said Eduard Maksymiv, who is here with his wife, Inna. The pair own 265 cherry and apple trees in central Ukraine and hope to use the wages they pocket to expand their farm.

The federal visas have generated controversy nationally, with some advocates challenging the practice of employers looking overseas. Some advocacy groups call guest worker programs such as this one, known as H-2B, exploitative. David North, a fellow at the Center for Immigration Studies, a Washington-based research center, argues that American employers should hire U.S. citizens.

“Companies say they can’t find workers,” he said. “Well, one of the ways you find workers is you raise wages or improve working conditions.”

Perham, however, has welcomed the newcomers. Meeting the group recently, Mayor Timothy Meehl urged them to take in the town’s weekly Wednesday morning turtle races and enjoy the area’s lakes.

“Any of you like to fish?” Meehl asked.

‘Sooner the better’

In the basement of the Wadena motel where they’ll stay until late December, the men and women introduced themselves. Name, country, shift: “I am Sergey. From Ukraine. I can work nighttime; I can work daytime. Whenever.”

When Nelson, 72, walked in and introduced himself and his son, Charlie Nelson, vice president and part-owner, the group gave an appreciative “aah.” Kenny related how he started the company in the 1960s with a single truck that quickly grew to a fleet of 10.

“We’re not only glad to have you here, we’re anxious to have you here,” Charlie Nelson told the group. “The sooner the better.”

Barrel O’ Fun, which also produces snacks under other store brands, hasn’t been able to keep up with swelling sales, Kenny Nelson said later. Because there aren’t enough workers, the company has had to prioritize its dozen production lines, trying to cut down on shortages and late fees.

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  • A group of mostly Ukrainian workers have come to Perham this summer for employment at KLN Enterprises, the family-owned parent company of Barrel O' Fun that also manufactures snack brands for other companies. Here, after eating a late dinner at the Wadena VFW, Slav Makukha, center, and his girlfriend Karina Babaninasit, sit on a school bus before the start of a half hour ride that will take them to the temp jobs at KLN in Perham for the 11 p.m. shift Wednesday, July 16, 2014, in Wadena, MN.] (DAVID JOLES/STARTRIBUNE) djoles@startribune More than 60 international workers, mostly from Ukraine,...

  • After eating a late dinner at the Wadena VFW, workers headed to a school bus to take them to their jobs at KLN in Perham. At left, Slav Makukha and girlfriend Karina Babanina outside their motel.

  • A group of mostly Ukrainian workers have come to Perham this summer for employment at KLN Enterprises, the family-owned parent company of Barrel O' Fun that also manufactures snack brands for other companies. Here, Slav Makukha, right, and his girlfriend Karina Babanina outside their temporary motel residence where they were skyping with Makukha's brother, who is living and working in Pennsylvania. Makukha and Babanina are temp employees of KLN in Perham and were waiting for their 11 p.m. shift to begin Wednesday, July 16, 2014, in Wadena, MN.] (DAVID JOLES/STARTRIBUNE) djoles@startribune More than 60 international workers, mostly from Ukraine,...

  • A group of mostly Ukrainian workers have come to Perham this summer for employment at KLN Enterprises, the family-owned parent company of Barrel O' Fun that also manufactures snack brands for other companies. Here, workers are photographed by each other with their work credentials after arriving at their work place at KLN Enterprises Wednesday, July 16, 2014, in Perham, MN.] (DAVID JOLES/STARTRIBUNE) djoles@startribune More than 60 international workers, mostly from Ukraine, are flew to Minnesota recently to take jobs in little Perham. Fast-growing KLN Enterprises, the family-owned parent company of Barrel O' Fun and others, recruited the men and...

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