As the economy continues to limp along, many are looking to manufacturing as the key to reviving our economic health.
Combined with stories of increased onshoring and reshoring, many headlines are hailing "manufacturing's comeback." Some even go so far as to say we are in the midst of a manufacturing renaissance.
The truth is manufacturing never went away.
A strong manufacturing sector has long been pivotal to our economic prosperity and national security, consistently delivering return on investment, revenue, exports, output and more. Today is no different.
After suffering the worst downturn since the Great Recession, manufacturing has been the driver leading the economic recovery. According to the U.S. Treasury Department, manufacturing has made up 26% of economic growth since 2009 and has added close to half a million jobs since 2010. In that time, real manufacturing output has grown 16% and productivity has increased 15%.
Now is a great time to strike while the iron is hot. There are several combined factors that are creating a favorable environment for a manufacturing growth spurt.
An abundance of natural gas is providing cheap energy. We also have the best science and engineering schools in the world and a genuinely American entrepreneurial spirit. This has helped attract a groundswell in foreign direct investment in manufacturing – currently at $838 million.
The world is paying attention to what the U.S. has to offer and the opportunities for manufacturers are many, if we are able to make the most of them.
Government leadership can help by developing a framework of policies to strengthen the manufacturing sector and level the playing field for U.S. companies in the global marketplace.
The Obama Administration has launched programs to encourage the development of technologically focused innovation centers (such as the National Additive Manufacturing Innovation Institute) and manufacturing hubs, and to boost Manufacturing Extension Partnerships.
However, the jury is still out on whether these initiatives are operating in a cohesive manner and providing the intended benefit to the industry, local communities, and the nation as a whole.
Progress has also been made in updating our export control system, but more needs to be done and it needs to be done quicker to avoid losing market share to our foreign competitors.
Our tax and regulatory systems are among the most burdensome in the industrialized world and represent a significant hindrance on our businesses, especially small businesses.
We also need an energy strategy that makes the most of our competitive advantage while reasonably protecting our environment.
But one of the most significant challenges we face, and one the government cannot take on alone, is a shortage of workers with the skills necessary for today's modernized factory floor.
It's going to take a collaboration of government, industry, and academia to solve the problem. AMT has made it a priority to promote and support collaborative initiatives to build a skilled manufacturing workforce. We call it a "Smartforce."
Despite the labor shortage and uncertainty over what the government will (or won't) do next, American manufacturers will do as they have always done: invest in R&D, explore new markets, and develop the innovative products for which we are known around the world.
They will continue to utilize advances in automation and other manufacturing technologies to enable their workers to be among the most productive in the world and increase their standard of living. This is what drives economic recovery.
This is why American manufacturing has endured.
While "renaissance" might be a term easy for pundits and others to toss around, the current state of manufacturing is more accurately described as digging in our heels, determined to survive just as we have weathered other downturns throughout history.
America's manufacturing sector has consistently provided the foundation for economic growth, job creation, and national security. It will continue to do so by confronting the challenges head-on and taking full advantage of the opportunities that lie in front of us.