Asset Management

U.S. Manufacturing is the Misunderstood Economic Powerhouse and on the Verge of “Something Big,” According to Brookings Institution Conference

The manufacturing industry has faced an uphill battle over the last 10 years, with six million jobs lost, damage by globalization and recession, and a widespread belief that it was waning. Despite these challenges, panelists at a Brookings Institution conference said there are good reasons to expect a resurgence of U.S. manufacturing. The Brookings event, titled “Fostering Growth Through Innovation,” is covered in-depth by a recent Industry Week article. Panelists contended that smart public policies, strong public-private programs, and the creation of a skilled workforce will help bolster the industry.

Bruce Katz, a vice president at the Brookings Institution, noted that a series of developments – rising wages in China, shale gas, the beginning of reshoring, and disruptive technologies such as 3D printing – offer the promise that U.S. manufacturing is at the “beginning of something big.”

“We still think about manufacturing in the U.S. as yesterday’s economy as opposed to the vanguard of innovation in our economy,” said Katz. “Manufacturing accounts for 9% of jobs, 11% of GDP, 35% of engineers, 68% of private R&D, and 90% of our patents. We may be the only economy to decouple production and innovation.” And to capitalize on these positive developments, panelists said manufacturing and policy leaders must tackle

some major challenges.

Greg Fischer, a former manufacturing CEO and now mayor of Louisville, Ky., said the U.S. needs to not only promote technical skills, but also soft skills such as the ability to work in teams.
Fischer noted that a cultural change needs to take place in the United States so that manufacturing jobs are valued and young people see them as desirable career paths. Panelists agreed that the manufacturing industry is generally misunderstood by the American public. Often, “the widespread view of dirty, low-tech factories doesn’t reflect the reality in many manufacturing workplaces which are quiet, clean, and feature advanced technology. As a result, parents and educators don’t encourage young people to look at manufacturing as a career path.”
Emily DeRocco, former president of The Manufacturing Institute, said experts do know what works to create a skilled workforce. However, solutions have not been implemented on a national basis,

such as developing more widespread manufacturing skills post-secondary education and certification programs, and focusing on growing regional economies where manufacturing clusters are currently developing.

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