Improving the manufacturing market in America

Of all various types of disruptions the rise of robotic technology and the Internet of Things has presented businesses with, the rising threat of taking over jobs has been by far one of the most controversial - particularly in the manufacturing industry.

For years, the issue of factory workers being eliminated has been a topic of discussion in America - and understandably so. In an article for The Wall Street Journal, Bob Tita recently reported that nearly 6 million manufacturing jobs were cut in the U.S. between 2000 and 2010. This severe reduction can be attributed to more companies choosing to use offshore sourcing to low-cost countries.

However, the manufacturing job market may soon see growth, with more politicians and business executives focusing on ways to domestically revive the sector. The interest in doing so is because manufacturing is one of the greatest sources of economic wealth. Put simply, relying on foreign countries for goods is costing the U.S. big money - a trade deficit of about $500 billion, Tita said.

Proposed solutions
But exactly how can manufacturing be re-ignited in America? The news source highlighted some of the strategies and solutions that are currently being discussed, including:

  • Increasing the value of exports
  • Enforcing the use of value-added taxes
  • Applying charges for market access
  • Revamping regulations and policies
  • More accurately assessing the logistics and hidden costs of offshoring

The bulk of the other suggestions largely center around improving the education, training and development of the manufacturing workforce. Tita pointed out that it is going to become increasingly important for companies to invest in automation and technology - equipment which can actually help employees in their jobs, rather than replace them. Furthermore, businesses should offer more on-the-job training to workers, since colleges are typically not providing adequate and specific enough education to students needed to meet the distinct needs of companies. The source also added that currently in progress with Congress is the proposal to create "manufacturing universities."

Attracting millennials to manufacturing
In addition to more processes automation capabilities, which allow companies to streamline production workflow and enhance the timeliness, cost-effectiveness and efficiency of many operations, digital technologies have also caused a shift in the manufacturing job market by increasing the number of IT-related skills and talent organizations are seeking.

For example, according to Aili McConnon, also a reporter for The Wall Street Journal, an increasing number of businesses are attempting to target tech-savvy millennials - which hasn't exactly been easy.

"What millennials don't realize is that modern manufacturing is full of cutting-edge technology," Manufacturing Institute Executive Director Jennifer McNelly explained to the source. "We make lifesaving medicines. We make cool cars. We are problem-solvers on a global scale."

McConnon also noted that if companies want to enhance the likelihood of finding and retaining top talent for manufacturing jobs, they are going to have to implement strategic solutions, including using virtual reality and video for targeting millennials and developing strong leadership programs.

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3 comments so far,Add yours

  1. This article was worthless. It basically offered nothing of value that was not already known.

  2. Companies are recognizing that with the use of the refined metrics of total cost of ownership (TCO) to uncover the hidden costs and risks of offshoring and reducing costs with sustainable strategies such as automation they can increase competitiveness and manufacture in the U.S. profitably.

    The Reshoring Initiative Can Help
    In order to help companies decide objectively to reshore manufacturing back to the U.S. or offshore, the not-for-profit Reshoring Initiative’s free TCO Estimator can help corporations calculate the real P&L impact of reshoring or offshoring.

    If we don’t automate, we will lose jobs. Other countries can automate so America must automate. If we automate, we will increase competitiveness and bring jobs back into the U.S.
    - If we have automation:
    o We can ship a higher quality product
    o We can ship faster
    o We will definitely lose the job to offshore if we don’t automate
    o American worker is better off because the job won’t go offshore

    Regarding expanding the manufacturing workforce, one reason for the shortage is too many students attending 4-year universities, resulting in a 40% excess supply of non-technical university graduates along with soaring student debt. The disconnect is in the perception of manufacturing careers. Manufacturing has shifted largely to modern, high-tech operations and pays on average 19% more than non-manufacturing jobs.
    The major obstacle is recruitment mainly due to three key issues:
    1. Perception that training is not as important as degrees
    2. Perception of ongoing manufacturing decline due to offshoring
    3. Perception that vocations/trades training is lower prestige/income than a 4-year university degree

    The Reshoring Initiative’s Skilled Workforce Development Program is designed to change some of the misperceptions about manufacturing and help communities develop the skilled professionals needed to reshore manufacturing to the US

  3. Bob Tita's article was great. Thanks for referencing it so clearly. I was quoted re VAT in Bob's article but my main focus is on the last bullet point item in the current article: using Total Cost of Ownership (TCO) instead of price for sourcing and siting decisions. Readers can find our free TCO software on line at