manufacturing

Report highlights challenges, lessons learned for reshoring advanced manufacturing companies

Reshoring manufacturing companies claim to be able to innovate at increasing rates, but some cite challenges with hiring qualified workers and with the country’s regulatory and trade policy environment, according to a new report from Select USA, a national program led by the U.S. Department of Commerce focused on business investment.  In Reinvesting in the USA: A Case Study of Reshoring and Expanding in the United States, authors from Select USA look at the experiences of six manufacturing companies that chose to reinvest in their U.S. operations, providing detail on what drove them to reshore, challenges and benefits to the move, and general lessons learned. They find that, although the reshoring process was more expensive and time consuming than the case companies expected, local partners such as economic development agencies provided valuable resources to make the process easier. 

Small-batch manufacturing needs connections to grow

In a recent report focused on the impact of the small-scale manufacturing sector, the Urban Manufacturing Alliance (UMA) compiled what they say is a first-ever examination of what this emerging sector looks like and what may help charge its growth. They found an information gap on these businesses, as many of them combine design, art and production, and fall outside of data collection categories used to classify manufacturers. The report begins to identify the role and economic potential of these emerging businesses to help local stakeholders identify actions they might take to grow the small-scale manufacturing sector.

Manufacturing rebound broad but uneven, report shows

Manufacturing growth is helping fuel one of the longest expansions in the U.S., steadily adding jobs since 2010, according to Economic Innovation Group’s (EIG) recent data brief, Manufacturing’s Real But Patchwork Rebound. While manufacturing job growth has risen over the past two years, the report notes that its growth was broad but uneven. Counties in western states saw the highest annual growth rates from December 2016 to December 2018, and the South saw the largest number of new manufacturing jobs over that period: 173,900. However, authors Kenan Fikri and August Benzow also found that after two years of accelerated growth, the U.S. manufacturing sector is showing signs of slowing down.

Ignoring Industry 4.0 leaves firms vulnerable

Federal and private R&D portfolios are investing heavily in designing and refining the key innovation components of the transition to cyber-physical systems of production: artificial intelligence, automation, IoT, advanced materials, and dynamic, decentralized decision making to name a few elements. There also is a fair amount of buzz about Industry 4.0 from the big manufacturing consultants and around industry trade shows.  Innovation and optimization, however, appear to be two very distant points on a continuum for both U.S. companies’ implementation of Industry 4.0 and public policy response to the opportunities and potential socio-economic impacts.

Upjohn: ROI of Manufacturing Extension Partnership eclipses 14:1

The National Institute of Standards and Technology’s (NIST) Hollings Manufacturing Extension Partnership (MEP) Program generates a sizeable financial return on investment for the federal government, according to a recent study by the Michigan-based W.E. Upjohn Institute. The $140 million invested in MEP during FY 2018 by the federal government generated more than $2.0 billion in increased federal personal income tax, a ROI of roughly 14.4:1 according to Upjohn researchers Jim Robey, Randall Eberts, Brian Pittelko, and Claudette Robey. Based on direct, indirect, and induced jobs generated by projects at MEP centers, the authors also find evidence that total employment in the U.S. was nearly 240,000 jobs higher than it would have been without the program.

Bipartisan bill would improve Manufacturing USA

Eight U. S. senators introduced a bill last week, endorsed by SSTI and more than two dozen organizations, that would provide performing Manufacturing USA centers with a path for continued federal support, while also better-incorporating the centers into other manufacturing and innovation resources around the country. Senators Chris Coons (D-Del.), Cory Gardner (R-Colo.), Kirsten Gillibrand (D-N.Y.), Thom Tillis (R-N.C.), Maggie Hassan (D-N.H.), Gary Peters (D-Mich.), Jerry Moran (R-Kan.), and Marco Rubio (R-Fla.) represent a bipartisan coalition that is well-positioned to support the legislation through the U. S. Senate Committee on Commerce, Science and Transportation. The full text of the bill can be found here.

Analysis finds software accounts for nearly one-third of business R&D, up 60 percent over 10-years

Software plays an increasingly large role in private sector research and development (R&D) expenditures, according to new research from the National Science Foundation’s (NSF) National Center for Science and Engineering Statistics (NCSES) and the Bureau of Economic Analysis (BEA). Based on a recent change in how the BEA treats software R&D in its calculations for gross domestic product (GDP) and other metrics, the analysis finds that the share of business R&D coming from software increased from 20 percent in 2006 to 32 percent in 2016, a 60 percent increase. The authors also look at longer-term trends in business R&D expenditures on software, as well as an analysis of software R&D in manufacturing and non-manufacturing industries.

RFP for Policy Academy on strengthening your state’s manufacturers

NIST Manufacturing Extension Partnership program is seeking participants for its second Policy Academy cohort designed to leverage manufacturing growth in your state. Funded by NIST MEP and organized by SSTI and the Center for Regional Economic Competitiveness (CREC), the Policy Academy will provide participants with an opportunity to collaborate with other states to identify best practices, partnerships, and policies that will strengthen their manufacturers. The process is customized to build on existing strategies, leverage available resources, and spur creative new ideas about how to address major challenges and build on current opportunities. On May 8, the organizers held an informational conference call to discuss the Policy Academy, which may be accessed here. The downloadable RFP includes application guidelines. The deadline to submit a proposal is June 7, 2019. 

Useful Stats: Employment in high-tech and manufacturing by state, 2013-2017

Many regional economic development strategies emphasize employment in manufacturing or high-tech, as these industries tend to provide well-paying jobs. Through an analysis of American Community Survey five-year data for 2013-2017, SSTI assessed state-level employment concentration within these sectors.

Manufacturers' outlook strong; demand for skilled workers grows

In the first quarter Manufacturers’ Outlook Survey for 2019, manufacturers continue to report a positive outlook for their own company and marked nine consecutive quarters of record optimism. However, their top concern remains the inability to attract and retain a quality workforce (71.3 percent cited the inability to attract skilled workers as their top challenge). The National Association of Manufacturers issued a report last month detailing the job openings in manufacturing, with the report’s author, Chad Moutray, calling the skills gap challenge “a full-blown workforce crisis.” In A Hiring Engine: A Breakdown of the Job Openings in Manufacturing, Moutray analyzes the employment trends in manufacturing, gives a sector-by-sector breakdown of recent job openings, identifies states where manufacturing jobs are located, and identifies the in-demand skills needed to fill them.

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