When Deloitte published its Global Manufacturing Competitiveness Index last year, the No. 1 driver of competitiveness was talent-driven innovation, according to top executives. The operative word here is "talent" -- the quantity and quality of skilled workers, scientists, researchers and engineers available to manufacturers in a given country.
There was a time when America seemed to have a monopoly on talent. No more -- at least not in the critical career paths necessary to maintain a competitive edge in the global marketplace of ideas. Countries such as Germany, China and India have done far more in recent years to encourage innovation (and in turn build vibrant manufacturing bases) in their own backyards.
This turn of events didn't happen overnight. To compete in a global marketplace, manufacturers have steadily evolved their processes for the better part of two decades. Employment on the shop floor of modern American manufacturers generally requires advanced skill sets, including knowledge of science, technology, and math, the "STM" of the new buzzword in education, "STEM." The "E," engineering, while not required for basic employment in manufacturing, is a critical component in boosting manufacturing competitiveness.
According to NAM's Manufacturing Institute, since 2003 high-skill employment needs in U.S. manufacturing rose 17% while low-skill employment needs dropped 9%. Even during the darkest days of the recent recession, one-third of manufacturers reported moderate to serious skill shortages in the hiring pool.
The development of a talented workforce -- that is, a workforce with the requisite skill set to work in a 21st century manufacturing facility and cultivate the next generation of innovation -- poses perhaps the greatest hurdle to America's future prosperity. Our growing affluence in the postwar years, due in large part to the success of our industrial base, ironically convinced Americans that we no longer needed to make things in America. Working- and middle-class youth, including the offspring of manufacturing workers, were encouraged to earn a college degree and seek career paths in service-oriented professions. As the number of college students increased steadily, from 1.5 million in 1940 to 12.1 million in 1980, according to the U.S. Census Bureau, fewer graduates opted for the "dirty" confines of a factory. Americans started viewing manufacturing as a dying sector and its jobs as providing a dead-end career.
During the same period, our society began de-emphasizing math and science in our primary and secondary schools. American students' aptitude scores in these areas started declining and the share of students who obtained math, science and engineering degrees in American colleges dropped from 11% in 1970 to 7% in 2000, according to U.S. Department of Education statistics. As of 2009, as reported by the Programme for International Student Assessment, our students ranked 30th in math and 23rd in science in a global assessment.
But there is hope. Organizations such as NAM's Manufacturing Institute have dramatically raised the profile of this issue over the past decade. They have launched campaigns to elevate the importance of math and science and grabbed the attention of politicians at the highest levels, including President Obama, who recently announced the Skills for America's Future initiative to link community college graduates with manufacturers.
Just as impressive is the effort by SkillsUSA to match students with potential employers. In a recent trip to Kansas City, Mo., I saw more than 5,500 high school and college students participating in SkillsUSA's 47th annual National Leadership and Skills Conference. Contestants competed in 94 events, testing their knowledge and skills in such areas as robotics and automation technology and precision machining technology.
Every great national challenge has a tipping point, beyond which no amount of money or political focus will solve the problem. America's STEM deficit and skilled-worker shortage is no exception. While we may never again see a situation such as the postwar years when the United States seemed to have a monopoly on talent, with the proper emphasis and resources, we can remain the world leader, a country where manufacturers and entrepreneurs want to innovate.
Stephen Gold is president and CEO of the Manufacturers Alliance/MAPI, an executive education and business research organization in Arlington, Va.