Recently, Stephan Helgesen has written a great deal about the death of American manufacturing over at NMPolitics.net here and here. As I point out in this rebuttal, the reality is that, while manufacturing has changed and it employs fewer workers than it once did, it is extremely efficient and produces a great deal of value.
American manufacturing is hardly dead, but, like the rest of the economy, it would benefit from a boost of certainty and market-based policies.
3 Replies to “Is US Manufacturing Dead?”
With respect to manufacturing, the U.S. is likely to be most successful in manufacturing related to new technology and manufacturing related to products that are tailored to the needs of the customer and products where fast delivery is important.
So that pretty much provides a road map for success in manufacturing.
Probably the most important factor is technological change and where that change originates. If it originates outside the U.S., that gives other countries a head start. So being a leader in innovation is supportive of having a robust manufacturing sector.
It is not clear that we are encouraging innovation in the U.S. One area of interest to me is weather modification often referred to as cloud seeding which is a major part of weather mod but not the whole story. It is disturbing to see the Chinese taking leadership in that field. They didn’t develop it, but copied U.S. and Israeli technology and have put it to work.
Fossil fuels is an area where there is much innovation. Whatever ones perspective on the use of fossil fuels and the need for alterative sources of energy, innovation in both conventional and alternative energy leads to manufacturing opportunities. Are we maintaining leadership in either area…conventional or alternative?
The process of falling behind in manugacturing has been going on for a long time. GM-Fanuc was a leader in Numerical Control Machine Tool Controllers, EDS (also GM) was a leader in manufacturing software, Square D was a leader in specialized program controllers (simpler than a modern computer), I have personally been involved with a number of technologies that are now owned by foreign companies.
How do our schools stack up re producing workers with the skills for manufacturing? Many manufacturing jobs require substantial technical skills. How many females look for careers in manufacturing?
In theory it is not possible to lose manufacturing jobs by outsourcing. If a job is moved overseas, there are then U.S. dollars overseas which normally would need to be spent in the U.S. creating a replacement job in the U.S. These dollars are not being spent but are being invested in U.S. Government Securities. That eliminates the need for U.S. dollars earned by overseas companies needing to be spent in the U.S.
There is a lot that could be done to make manufacturing more viable in the U.S. We start with a huge advantage namely the market. All other things being equal, it is better to manufacturing things close to the customer not half-way around the World. So if we are not doing as well as we would like with respect to manufacturing, it is our own policies that have caused that result and it can be improved.
I agree, it is our own policies that is reducing our manufacturing jobs, also we poorly educate our students for working in manufacturing!
Just getting around to reading Mr. Gessing’s ‘rebuttal.’ to my articles on manufacturing. I’m afraid he may be missing some of the larger points I have been raising with my series of articles. My mission is to issue a wake-up call and make the case for returning to manufacturing by raising the value of manufacturing in the eyes of corporate America. I am not writing manufacturing’s epitaph just preparing the obituary in the hopes that it’s not needed. I would love to be proven wrong on my thesis that we have ceded manufacturing to other nations, but my empirical observations working with hundreds of companies both here and abroad over a 25-year period have shown me that no amount of ‘saying it’ (pretending we’re still preeminent in manufacturing) will actually substitute for ‘doing it.’ Let the dialogue continue!