MANUFACTURING ENGINEERING THE SITUATION IN GREECE … · IRMA PROJECT: MANUFACTURING ENGINEERING IN GREECE 5 4,5% of the GDP). This situation is expected to lead to an increase in

MANUFACTURING

ENGINEERING

THE SITUATION IN GREECE

IRMA PROJECT: MANUFACTURING ENGINEERING IN GREECE

2

Organization Responsible: Action Synergy S.A.

Department Responsible: European Department

Person Responsible: Konstantinos Diamantis- Balaskas

Organization Address: Patroklou 1 & Paradeisou, GR-15125, Maroussi,

Athens, Greece

Organization Telephone: +30 210 6822606

Organization Fax: +30 210 6894576

Organization E-Mail: [email protected]


3

TABLE OF CONTENTS

General Analysis of the Manufacturing Sector in Greece……………..………….p.4

Trends and Main Indicators in Manufacturing Engineering………….…….…....p.8

Connection between Manufacturing Engineering and Higher

Education…………..……………………………………………………….……………………………….p.10

Best Practices………………………………………………………………………………………………p.17

SWOT Analysis for Greece…………………………………………………………….……………p.20


4

GENERAL ANALYSIS OF THE MANUFACTURING

SECTOR IN GREECE

The manufacturing sector in Greece is relatively small in comparison with the

other European countries. Because of the predominant agricultural character of the Greek economy, the appearance of Manufacturing in the Greek economy has delayed significantly and it has never played a predominant role in the country’s economy. Nowadays, 12,4% of the total workforce is

employed in agriculture, 65,2% in the service sector and only, the 22,4%1 of the total workforce of the country is employed in organizations active in manufacturing (0,4% in mining, 12,8% in the industries, 0,9% in the energy sector and 8,3% in constructions). Manufacturing also represents nearly

23% of the total GDP of the country. The main manufacturing centers in Greece are the cities of Athens, Piraeus, Thessaloniki, Patra, Kalamata, Volos, Kavala, Veria, Chalkida, Aigio etc.

At the past, the vast majority of the manufacturing enterprises in Greece

were related with the textile industry. Now, the biggest manufacturing sector in Greece is the construction industry that represents 8,3% of the total GDP of Greece. The sector had a big boost in its activity before the Olympic Games in Athens when it reached the peak of its activity but from then on it

has declined. The total number of companies that constitute the construction sector is 2.500 from which 603 are S.A.s or Ltds. The employment in the sector has exceeded the threshold of 340.000 people during the Olympic Games and then it decreased. Nowadays, the construction sector is in crisis

since many companies have problems of cash flow. This situation does not concern only the small enterprises but affects also the bigger ones since the decrease of the construction activities in conjunction with the decrease of

the Public Investment in the sector scheduled in the State Budget for 2009 (3,2% of the GDP while for 2008 was 3,8% of the GDP and for 2002 was

1 The facts come from the National Statistics Service (ESYE) and refer to the year 2005


5

4,5% of the GDP). This situation is expected to lead to an increase in the unemployment rates as well as the close down of many enterprises2.

In the rest of the manufacturing sector, the biggest industry is the food industry which represents nearly 20% of the activities of the manufacturing

sector if we do not include construction3. Second biggest industry in the sector is the products of oil and carbon (11,22%) and then follow the non-

metallic minerals (8,45%), the Basic Metals (8,02%), the chemical products (7,74%), the textile materials (5,63%) and the final metal products

(4,33%). The smallest industry in the sector is Recycling which represents only 0,02% of the total manufacturing industry (except constructions).

During the last decade, the manufacturing sector which has increased faster of all the rest, is the sector of the Means of Transport (Increase of 141,4% in

the production level between 1995-2003)4. Then comes the sector of Chemical products (66% increase in the level of production) and then the sector of Medical Organs (54,2% increase). On the other hand, the sectors

that have declined are these of computers and office devices (-71,7%) and then followed by the leather and shoes industry (-43,2%).

A basic characteristic of the Greek manufacturing sector (excluding the

construction sector) is that it is based heavily in Small and Medium Enterprises (SMEs) as the rest of the Greek Economy. The average number

of employees in the Greek manufacturing companies for the year 2002 was 5,85 employees per enterprise5. This is the smallest figure in the EU. The

second smallest average number of employees per company in the

manufacturing sector is seen in Italy (8,7 employees) while in Ireland, the average size of the manufacturing enterprises is 49 employees. The manufacturing sector which has the largest average number of employees is the Oil Industry (39,4 employees per enterprise) followed by the Chemical

Industry (29,3 employees). On the other hand, the sectors with the smallest average number of employees is the Transport Material (1,52 employees), the Wood Industry (2,23 employees) and the Leather Industry (3,06 employees). Furthermore, the companies which employee more than 100

employees in the manufacturing sector (excluding constructions) represent

2 Eleni Bota, “Survival Problems for the Construction Sector”, http://stocks.pathfinder.gr/news/673337.html.

20/11/2008 3 Takis Politis, “Greek Industry the last 40 tears: Trends, Structure”, Institute of Economical and Industrial Research,

3/7/2006 4 Idem

5 Idem


6

only the 0,1% of the total number of enterprises6. This has caused financial problems due to limited equity capital and also limited access to bank

financing, especially to long-term funds and venture capital. Therefore, the

Greek SMEs have a chronic problem of access to financing.

However, the last available facts (for the year 2007) show that the Greek Manufacturing industry has achieved growth and generally it did relatively

well in relation with the past years7. According to the report of the Foundation for Economic and Industrial Research (IOVE) on the Greek

economy, among the main industrial grouping production growth was more noticeable in non-durable consumer goods (around 3.8%), which showed a

reversal of the previous year's negative climate. There was also a boost in the production of the durable consumer goods and intermediate goods

sectors8.

Furthermore, the latest available data show that the Domestic Market

Turnover Index in Industry increased by 1.6%. The increase of the turnover was biggest in the Energy sector for the Domestic Market as well as for the

exports.

This increase was made possible partly because of the new Development

Law. According to available data from the Ministry of Economy and the Ministry of Development, many manufacturing enterprises sought to utilize the beneficial provisions of Development Law 2399/2004, and subjected their investment plans to the law's stipulations.

The Ministry of Development (YPAN) and its General Secretariat for Industry

have subjected to the provisions of Law 2399/2004 seventy five (75) integrated, multiyear business-investment plans, submitted from an equal

number of companies and with a total value of €687.2 million. Eighteen (18) investment plans exceed €10 million each9.

These large investment plans concern sectors such as packaging, pharmaceuticals, fabricated metal products, foods, tobacco, furniture,

chemicals, and metal constructions for photovoltaic arrays.

6 F. Voulgaris, D. Asteriou, G. Agiomirgiannakis, “”Size and Determinants of Capital Structure in the Greek

Manufacturing Sector”, http://www.eap.gr/programmes/deo/deo34/docs/IRAE.pdf. 7 Haris Floudopoulos, “Growth Prospects for Greek Manufacturing”, Trade with Greece, 2008 Edition,

http://www.tradewithgreece.gr/trade/2008/90-95%20floudopoulos.pdf. 8 Idem

9 Idem


7

Finally, according to a Statbank survey, the sectors with the largest numbers of companies that qualify for the list of Greek "business diamonds", are

those of metals, food, non-metallic mineral products (cement producers,

quarries, ceramic industries etc). In order to qualify for this list, a company must have a turnover of more than €12 million10.

The last months, the turnover of the Greek companies in the manufacturing

sector has dropped again because of the world financial crisis. The decrease is far less than this of the other industrial countries11 but concrete figures

have not been published yet.

10

Idem 11

Newspaper “To Vima”, “The Ministry of Finance is Optimist that Greece will not have serious consequences from

the Crisis”, 3/12/2008


8

TRENDS AND MAIN INDICATORS IN THE

MANUFACTURING ENGINEERING

General Trends

The main trends in the sector of Manufacturing Engineering in Greece are

the following12:

• There has been a great increase in production before the Olympic

Games of 2004 which was followed by a great decrease after their end. Now, the enterprises are again growing

• Many enterprises have been translocated in the near Balkan countries (mainly Bulgaria and then FYROM)

• Like the rest of the manufacturing sector, the vast majority of the enterprises in the sector are very small, small and medium enterprises

• European funds are being used to create infrastructure, introduce new technologies and internationalize the enterprises.

• Generally, there is a small degree of cooperation with research institutions

• Because of the small size of the companies, there is generally a lack of

“branding” in the manufacturing products

Job Market

Very few positions, mostly for inexperienced workers with University degree

and knowledge of Computer and English are some of the main characteristics for the job market of the Manufacturing Engineering sector in

Greece. More analytically, according to a survey which analyzes the employment trends for engineers in Greece13, based on the employment

classifieds for engineering disciplines published by the weekly bulletin of the Technical Chamber of Greece, the trends and main indicators that can be 12

Skoubas, Aggelos- Tsitsopoulos, Ioannis, “Καταγραφή της Κατάστασης της Βιομηχανίας”, “Registration of the

Industrial Situation”, TEE/TKM, Thessaloniki May 2006 13

Ilias T. Sarafis, “Employment trends for engineers in Greece: a multidisciplinary survey”, World Transactions on

Engineering and Technology Education, Vol.2, No.1, 2003, p.61-64


9

concluded for the manufacturing engineering sector in Greece are the following:

• Most positions were for inexperienced engineers or those with a low level of experience. More specifically, 39,8% of the total number of

positions were for people with no experience and only 13,8% required an experience equal or superior to 5 years. Manufacturing,

technical support and quality/safety engineering positions were related to inexperienced staff while the most experience was requires

for managerial positions. • Most positions were for graduates from Greek Universities (AEI)

(69,2%), although there is an emerging need for TEI (Tertiary Level Technical Education) graduates.

• The engineering positions offered for Mechanical Engineers represent 18,9% of the total number of positions offered. This is the second highest percentage after the positions offered for Civil Engineers

(32,3%). After the positions offered for Mechanical Engineers follow the positions for Architects (18,4%) and Electrical Engineers (10%). The lowest number of positions offered is for the Chemical Engineers (2,4%).

• However, most of the positions were offered for design (34,1%) and supervision (27,5%). The percentage of positions offered in the Manufacturing sector is very low and represent only 2,4%

• The company type which offers most positions is Construction (35,3%). Then, follow Design (26,3%), General Technology Companies (15,9%), Industry (6,9%), Trading Companies (5,7%) and Other (9,9%).

• The majority of positions (88%) concern Athens. A small percentage

concerned Thessaloniki (3%), the rest of Greece (7,2%) and abroad

(1,8%). • Moreover, 62,5% of the positions offered for manufacturing required

Computer Skills while the same percentage required also knowledge of the English language.

• The job positions related to manufacturing concerned mostly Chemical Engineers (10,2% of the total number of jobs offered for Chemical Engineers are in the manufacturing sector) and Mechanical Engineers (7,1% of the total number of jobs offered for Mechanical Engineers

are in the Manufacturing sector)


10

CONNECTION BETWEEN MANUFACTURING

ENGINEERING AND HIGHER EDUCATION

1. Programs of studies offered in the Universities

In Greece, there are several University departments that offer education in

the Manufacturing Engineering sector.

The University of Thessalia has a department called “Department of

Manufacturing Engineering” which is included in the “School of Technological

Sciences” of the University. According to the department’s curriculum, aim of

the department is to “create scientists capable of developing and managing

of new technologies in the field of Manufacturing Engineering as well as

organizing and managing the production processes of industry”.

The duration of studies is 6 years and in order to be able to graduate, the

student has to pass successfully 52 semester courses plus a final

dissertation and a two month internship in enterprises or organizations. In

the end of the 5th semester of the courses, the students can choose a

direction of studies in which he wants to be specialized.

The directions that he can choose in this department are the following:

1. Energy, Industrial Procedures and Environment Technology

2. Mechanics, Material and processes

3. Organization, Production & Industrial Administration

4. Software and Computer Processes in Manufacturing Engineering.

The department offers also a postgraduate degree in “Contemporary

methods of Design and Analysis in Industry” which has the following

directions of study:


11

1. Energy Systems, Industrial Procedures, Environmental Technologies

2. Mechanics, Material and processes

3. Organization, Production & Industrial Administration

Another University department which offers training in these issues is the

Department of Design Products and Systems Engineering of the Aegean

University. This University offers a Postgraduate program on “Design of

Interactive and Industrial Products and Systems”. The program focuses on

the process of design of industrial products with the use of modern computer

technologies.

In most of the cases, Manufacturing Engineering is part of the Departments

of Mechanical Engineering of the Universities or the Technological Institutes

that offer third level education.

In the National Technical University of Athens, the Department of Mechanical

Engineering, according to its curriculum, “covers all the sectors of General

and Industrial Engineering given the fact that this science area is very wide.

The student has the possibility to choose narrower and more specified areas

through the choice of non-compulsory courses. This specialization makes

easier for the students to follow the desired professional careers or to be

further specialized through postgraduate studies”.

The department has 3 sectors:

1. Energy

2. Manufacturing

3. Industrial Administration

The same situation can be found also in the Department of Mechanical and

Aircraft Engineering of the University of Patra. The department covers most

of the sectors of General and Industrial Engineering and its divided into 5

sectors:

1. Applied Engineering, Technology Materials

2. Energy, Environment and Aircraft


12

3. Manufacturing

4. Organization and Management

The same situation can be found also in the University of Thessaloniki and

the department of Mechanical Engineers.

This is also the case in the Technological Institute (TEI) of Piraeus when

there is the Department of Mechanical Engineers which offers as part of its

curriculum courses (in the fields of heat, Mechanical Flows, thermal

machines, machines working with thermal liquidity, valorization of

alternative sources of energy, Environmental Technology, Measurement

Technology, Evaluation of investments, construction) which allow the

student to be trained in the field of Manufacturing Engineering.

The same situation can be found in the TEI of Serres where in the

department of Mechanical Engineers offers courses that allow the students to

be educated also in the field of manufacturing engineering. Moreover, the

department has a special direction of studies dedicated in the construction

sector.

Similar is the situation also for the departments of mechanical engineeering

in the TEI of Kozani, Kavala, Crete, Larissa, Patra and Chalkida.

In other cases, the sector of Manufacturing Engineering is inserted in the

department of Production and Administration Engineers. Here, Manufacturing

Engineering is related also with management and organization courses that

aim to train medium and high executives in the sector with capabilities of

organizing a manufacturing engineering business. This is the case in the

Democritus University of Thrace and of the Technical University of Crete.

In the case of the Democritus University of Thrace, according to its

curriculum, “the department of Production and Administration Engineers

accomplishes its mission though teaching, researching and applying of

systematic ways of improvement of the productivity (increase of the quality

and of the quantity of the production with parallel decrease of the resources)

and through training scientists engineers capable to study, research and

occupy with the design of the structure and the functioning of contemporary

technological and administration systems”.


13

The department of Production and Administration Engineers is constituted of

three sectors:

1) The Production Systems Sector

2) The Administration Systems Sector

3) The Sector of Materials, Processes and Engineering

In the case of the Technical University of Crete, “the graduates of the

department can be occupied in all the stages of production in industries, the

service sector or governmental organizations as medium and high

administration executives and advisers in the fields of innovation and

development.

The program of studies in the department includes courses from the areas of

mathematics, physics, humanitarian sciences, production systems,

enterprise research, financing, management, information systems, decision-

making systems etc.

The department is divided into three sectors:

1. Organization and Management

2. Decision-Making Science

3. Production Systems

Finally, the TEI of Western Macedonia (located in Kozani), has a special

department called department of “Industrial Design”. Aim of this department

is the design of industrial products taking into consideration their use, their

adaptation in the human environment and their aesthetic presentation.

Summarizing, the Greek Universities and Technological Education Institutes

(TEI) that offer courses in a field relevant to the Manufacturing Engineering

in an undergraduate level are the following:


14

Institution Course

University of Thessaly Manufacturing Engineering

University of the Aegean Design Products and Systems

Engineering

National Technical University of

Athens

Mechanical Engineering

University of Thessaloniki Mechanical Engineering

Democritus University of Thrace Production Engineering

University of Patra Mechanical and Aircraft Engineering

Technical University of Crete Production Engineering

TEI of Western Macedonia Industrial Design

TEI of Western Macedonia Mechanical Engineering

TEI of Serres Mechanical Engineering

TEI of Kavala Mechanical Engineering

TEI of Piraeus Mechanical Engineering

TEI of Crete Mechanical Engineering

TEI of Larissa Mechanical Engineering

TEI of Patra Mechanical Engineering

TEI of Serres Mechanical Engineering

TEI of Chalkida Mechanical Engineering


15

2. Absorbency of the graduates of the University Departments in the Labor Market

As we saw above, in Greece, there are not many University departments

specially dedicated in Manufacturing Engineering and thus we cannot

have a complete idea of the absorbency of the university graduates in

this sector. What we have are small researches regarding the absorbency

of the Graduates of specific University Departments related with the field

in the Labor Market.

For example, there is a research concerning the graduates of the

Mechanical Engineering department of the TEI of Western Macedonia

which can be considered indicative. According to the results of this study

(which was conducted in 200614), 62,5% of the graduates of the

department found an employment in a field related with their studies,

10,3% remained unemployed and the rest (27,2%) are working in a field

unrelated with their studies. These percentages examined alone can be

considered as negative. However, if we take into consideration the fact

that the average rate of unemployment of the TEI graduates is 12,4%

and that the rate of the people that work in a field unrelated with their

studies is more in other departments, the situation is relatively good.

Similar are the results of another survey concerning the graduates of the

TEI of Serres (Department of Mechanical Engineering). According to this

survey15, 87,1% of the graduates of the department are working (67,1%

as employed and 20% as self-employed). This percentage is one of the

highest in the whole institution. Furthermore, the results of those who

work in a field related with their studies is 70,3% (second higher in the

institution after the department of civil constructions).

Finally, from a research done in the graduates of all University

departments in Greece, the percentage of the mechanical engineers that

claim to have a stable work is 73,3% (as opposed to 70,3 for Political

Engineers and 70,4 for Chemical Engineers and 95,2 in Nursery and 91,2

in Pharmacy) while 26,7 have an unstable job. For the purposes of the 14

http://career.teikoz.gr/newsletter/05_teyxos_2006-07.htm 15

TEI Serron, Grafeio Diasyndesis, “Συγκριτική Μελέτη Παρακολούθησης Αποφοίτων ΤΕΙ Σερρών” (Comparative

Study on the absorbency of the graduates of the TEI of Serres), November 2006


16

research stable work means workers in the public sector, workers with a

contract of undetermined time, workers in a project that declare that they

have stable employment, self employed that declare that their business

has positive perspectives. Unstable work means workers with a contract

of determined time, workers in a project that that declare that they have

unstable employment, self employed that declare that their business has

negative perspectives.

Here, we must remind that the data mentioned above regards the whole

sector of Mechanical Engineering as there are no specific data related to

the field of Manufacturing Engineering.

3. Gaps in the Educational System

According to a recent survey16 made by the Organization of the Greek

Industrialists (SEV), the educational system has not been able to train

their graduates well in the latest information and other technologies.

According to this survey, 57% of the companies asked said that they

cannot find or they find very difficultly people with appropriate third-level

education to work in their companies in the field of Mechanical and

Manufacturing Engineering. According to the Greek Industrialists the fault

is of the Greek University system which is late in the process of

adaptation in the new needs of the economy and the new technologies

and is more adequate to prepare the graduates to work in the public

sector than the private.

16

Nota Triga, “Τις πταίει για την ανεργία» (Who’s fault is unemployment), Το Vima Newspaper, Sunday, 15/2/2004


17

BEST PRACTICES

One of the best practices in Greece in the field of Manufacturing Engineering

regarding the use of creative tools for design phases, the use of creative

approaches during the production phases, the use of nanotechnology in the

manufacturing process, the study of environmental issues and the

development of human resources is Halkor S.A.

Halkor S.A. is the leading company in the field of fabricated metal products.

The year 2006, Halkor S.A. has increased its sales by 85% to 730 million

euro and its profits by 40,8% to more than 20 million euro.

HALCOR is a large-scale modern industrial company with over seventy years

of expertise in metal processing (it was founded in 1937). It holds a

significant position in European and global markets, with four modern plants,

three in Greece and one in Bulgaria.

The company is dedicated to the attainment of high quality. It has ISO

9001:2000 certification, uses state-of-the-art technology and employs

specialist personnel. Substantial continuous investment in research and

know-how development allows the company to create innovative new

products, which contribute to the company’s aim of being the constant

leader.

As far as the environmental aspects are concerned, the respect to the

environment is a matter of principle for HALCOR. Proof for its interest to

environmental issues is the implementation of a management system

through which the company monitors a variety of environmental aspects.

The certification of this system according to ISO 14001 requirements, is a

further proof of the company’s commitment to eliminate the impact of its

activities to the environment.


18

The responsibility to watch and monitor the environmental aspects has been

assigned to dedicated specialists who propose the required environmental

protective measures. Measures that are already in operation consist of the

following: Collection and Filtering systems placed on the melting furnaces to

arrest suspended particles, neutralization plants to treat the industrial

wastes, vacuum distillation systems that restrict the release of ozon

depletion substances utilising State of the art technology, etc.

An important aspect which cannot be overemphasized is the massive

recycling of copper scrap which is part of company’s main activities.

Recycling is also encouraged for items used in support of company’s

operations, such as packaging materials. To this respect, Halcor has

contracted organizations specializing on such matters.

Where its operations are performed in environmentally sensitive areas (such

as its rolling mill plant, operating in the district of Tavros near the Athens

city center), the company is committed to impose stricter self controls. To

provide proof of this commitment, the rolling mill plant was subjected to the

EMAS pollution control program under the auspices of the ministry of

Environment. The Environmental Statement of 2006 for this plant provides

the relevant information on the environmental performance.

Besides that, HALKOR implements effective methodologies to:

• Enter vital strategic partnerships, focusing on adjustability and

innovation;

• Invest in its people's skills through the continuous upgrading of know-

how, both in business and in technical terms;

• Combine profitable business with social responsibility;

• Use technology in ways that can satisfy their customers—partners'

needs;

• Undertake effective social and environmental actions being fully

conscious of the meaning of Corporate Social Responsibility.

As far as human resources are concerned HALKOR offers high quality

professional experience and evolution both to new and to experienced


19

professionals. Furthermore, it makes the most for developing these

human resources by We make the most of our human resources by

providing:

• Development of knowledge and abilities through continuous training

programs. The subject of the training programs it implements can

vary, covering a wide range of technological and administrative

issues concerning all company fields and levels. Aim of the

company is the participation of every worker in at least one training

program per year.

• Transfer of know-how


20

SWOT ANALYSIS FOR GREECE

On the basis of all the facts that have been mentioned in the previous pages,

we present in this section the SWOT analysis for the Manufacturing

Engineering sector in Greece.

STRENGTHS WEAKNESSES

1. The industry has achieved growth in the last years despite

the decrease that followed the

end of the Olympic Games

2. Good absorbency level for the University graduates (above

national medium)

3. Relatively stable jobs

4. Recent expansion of the Greek manufacturing enterprises in

the Balkan region

5. European funds help modernization

1. The Manufacturing sector (in general) is relatively small

2. Financial problems due to the predominant character of the

SMEs

3. Not specific University Departments for Manufacturing

Engineering

4. Not a lot of investment in new technologies due to the small size

of the enterprises

5. Small degree of cooperation between enterprises and research

institutes

6. Lack of “branding”

OPPORTUNITIES THREATS

1. Recent development laws facilitate the development of

the sector

1. Recent financial crisis

2. Companies may relocate to other countries were


21

2. Lots of market opportunities in the Balkan countries

3. Low oil prices may reduce the production costs

4. The development of lifelong learning will enhance the skills

and competences of the

workers in the sector

production costs are lower

Documents

MANUFACTURING ENGINEERING THE SITUATION IN GREECE … · IRMA PROJECT: MANUFACTURING ENGINEERING IN GREECE 5 4,5% of the GDP). This situation is expected to lead to an increase in