Employee-owned Schenectady Steel prospers during pandemic as companies ramp up projects – The Daily Gazette

ROTTERDAM — Even during the pandemic, business has been good for Schenectady Steel Co. Inc. in Rotterdam, a structural steel fabrication company that will celebrate its centennial in 2024.

“We were really fortunate because we were working on schools and pharmaceutical projects in 2020. We were deemed an essential business,” said company president Claudio Zullo.

Those projects included steel for a 350,000-square-foot manufacturing space for Regeneron Pharmaceuticals in Rensselaer County, and the ETEC (Energy, Technology and Entrepreneurship) building on the University at Albany’s Harriman campus.

The 100% employee-owned company is currently busy with 10 structural steel fabrication projects in New York state and Connecticut.

“The past couple of years have been absolutely fantastic. Really good,” Zullo said.

He said the company measures its progress in tons of manufactured steel. In 2021, the company fabricated 7,340.73 tons of steel, and in 2020 the company fabricated 5,012.42 tons. Since 2015, the trend in tons manufactured has steadily increased from 2,626.09 in 2015 to the 7,340.73 last year.

The trend continues, Zullo said.

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The company has two large manufacturing buildings just off the main railroad tracks at 18 Mariaville Road. The raw steel comes in on rail and is fabricated according to project specifications, starting in the north building and finished in the south building.

Schenectady Steel has provided fabricated structural steel for numerous projects in the Capital Region in past years and continues the trend this year. For example, the company fabricated the steel for the The Landing Hotel and the retail building in the Rivers Casino complex in Schenectady as well as the Saratoga Casino Hotel in Saratoga Springs.

Schenectady Steel was founded in 1924 by Leon Phelps. Leon’s sons John and Glenn took over the company in 1948, and in 1975 John Phelps started selling stock to the company employees. By 1986, the company was 100% employee-owned under an ESOP (Employee Stock Ownership Plan).

A total of 56 employees work at the company. They are all skilled labor, including operators of the CNC (computerized numerical control) machines, welders, and drillers and cutters. The office side has project managers and mechanical coordinators. The company does not employ professional engineers, and instead sublets that work out to two firms: Lehigh Valley Technical Associates of Lehigh, Pennsylvania, and RAM Drafting Ltd. in Ontario, Canada. The erection of the steel is also sublet to other companies.

A total of 98% of the steel used is made in the United States. Zullo said some specialty steel required for a project is not made in the U.S. and is imported from Germany, Japan and Belgium.

“They are a good, solid company.” said Ray Gillen, chairman of the Schenectady Metroplex Development Authority. He said being employee-owned helps Schenectady Steel “retain and build a great workforce” because company profits are shared with its employees.

In addition to being located right off main railroad tracks, the company is also close to major highways such as Route 7, I-88 and I-90. “That part of Rotterdam is a great location [for trucking],” Gillen said.

“They [Schenectady Steel] are an important indicator of the economy,” he added.

Stephen Phelps retired several years ago as shop superintendent. He was the last of the Phelps family actively involved in production work. He remains on the company’s board of directors.

His grandfather founded Schenectady Steel and his father, John, brought him into the company in the 1970s.

“My father was old-school. When I got out of the service I went to the shop as a laborer,” he said. “That taught me the business from the ground up. I worked my way all the way up.”

“When my father retired, they [employees] bought the company,” he said. Phelps said employee ownership “really brings the blue-collar guys” into the production. “They are involved. … They monitor the work of other employees because they want the stock value to increase,” he said.

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“This sets up a whole beautiful [workplace] atmosphere,” Phelps added. “Claudio [Zullo] has done a super, fantastic job. He’s in it to make the company thrive,” he said.

Phelps said that Zullo has been with the company for 15 years and his father and brother both worked for the company.
Ryan McCarthy, a certified welding inspector (CWI), is the current shop superintendent, a position he’s held for three years.

He said every employee takes ownership in the work being done.

“They receive a share of company stock toward retirement. If the company does well, the employees do well,” he said.

McCarthy said when the steel is offloaded from the rail yard it first goes to the north shop, where beams are cut into specified angles and holes are drilled where required. Much of this work is computer-assisted.

Then the steel is transported to the south shop where the fabrication occurs, parts are fit to the main member beams and the structural steel is prepared to be shipped to the erecting company.

“We’ve had a couple of really good years. We never skipped a beat during the pandemic,” McCarthy said.

Jeffrey Houck is superintendent of the north shop. “I’ve been with the company for 32 years. I started out on the bench, grinding and welding,” he said. He then was promoted to night foreman and then to programming, and finally to superintendent.

“It’s all computerized equipment,” Houck said.

McCarthy started at Schenectady Steel but left the company for six years. Returning to the company is the “second best decision I’ve ever made.” He praised the management team. He also served with the U.S. Navy CB (construction battalion) with tours in Iraq and Afghanistan.

McCarthy said Schenectady Steel’s employees work a 40-hour week with occasional overtime. They work nine-hour days Monday through Thursday and just a four-hour day on Fridays so that workers can enjoy a longer weekend.

Schenectady Steel projects
Schenectady Steel President Claudio Zullo listed the company’s current projects, including:
- 350,000-square-foot manufacturing facility on Vista Boulevard in Bethlehem. Erection of the steel starts in April.
- 300,000-square-foot marijuana plant in Johnstown
- 75,000-square-foot recreational marijuana facility at the Port of Coeymans
- 177,000-square-foot facility for UHS Wilson in Binghamton
- 70,000-square-foot business school building at Southern Connecticut State University
– 114,000-square-foot elementary school in South Windsor, Conn.
- 95,000-square-foot building at North Bradford High School in North Bradford, Conn.
- 360,000-square-foot Amazon warehouse in Plainfield, Conn.

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