On the production line at Digi-Key.
If approved, the new facility is expected to create more than 1,000 jobs—but the city is already struggling to attract workers.
March 7, 2017
Digi-Key Electronics said it is mulling over several options on where to open a new one-million-square-foot fulfillment, manufacturing and warehouse facility.
The electronic components manufacturer called Thief River Falls, where the company is headquartered, its “preferred location.” However, an expansion deal would be contingent to both local approvals and legislative changes that are required.
The company did not name other cities where it may open the new facility.
“Given our large size, every major expansion becomes more complex and requires that we review a variety of possibilities,” Rick Trontvet, Digi-Key’s vice president of administration and human resources, said in a statement. “This review process involves a lot of fact finding, including due diligence with local and state officials to help us make these decisions.”
Arguably the largest hurdle Digi-Key faces in expanding in Thief River Falls is the lack of housing options for potential new hires. According to Digi-Key, as many as 1,000 new workers would be hired at the new site over a 10-year period. However, for various reasons, much of the company’s 3,200-member workforce live up to an hour away from the company’s headquarters.
Others have opted to bed down in nearby eldercare facilities or take Digi-Key-funded bus lines to work. Last September, TCB looked into the full-extent of how greater Minnesota’s housing crisis is affecting Digi-Key
and other companies’ ability to attract talent.
Dave Doherty, Digi-Key’s president and chief operating officer said ongoing growth of its domestic and international sales is what drove the need for a new facility.
Investment value of the project is said to be between $200 and $300 million and would contribute an additional $500 million in state economic output.
Currently, the company distributes parts for smartphones, medical devices, audio equipment and other devices from over 650 manufacturers. The company has more than 1.3 million products in its inventory, which it said generates $1.5 billion in economic output and adds over $940 million to the Minnesota’s gross state product.