Manufacturing

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AME’s Marshall Plan — Becoming a Nation of Makers, Again

2 Sep, 2015

By: Glenn Marshall

At the end of World War II, America had become the world’s leading manufacturing powerhouse, accountable for 50 percent of the world’s industrial production. Now, the U.S. produces only a fifth of the global manufacturing output. Historically, the U.S. possessed both the knowledge and culture able to quickly adapt to producing vast quantities of material.

The Marshall Plan was designed to lead the rebuilding and revitalization of the manufacturing infrastructure and the economic recovery of Europe following WW II. The plan sparked the economic recovery of restoring the confidence of the European people in the economic future of their countries. America needs its own Marshall Plan to return to its manufacturing roots and revive a growing middle class with high-paying manufacturing jobs that make the “American Dream” a reality, again.

The Challenge

The American economy is experiencing the slowest post-recession recovery in 70 years, as reported by The Heritage Foundation. This slow recovery accounts for virtually the entire reduction of the unemployment rate since 2009 because those not looking for work do not count as unemployed. The unemployment rate for teenagers remained very high at 18.1 percent at the end of June 2015. In an era in which education has never been more important for economic prosperity and success, the U.S. has fallen behind many other nations in educational attainment and achievement.

The National Assessment of Educational Progress (NAEP) in 2013 reported only 34 percent of students entering high school were proficient in reading and mathematics. In the 2013 study conducted by the Organization for Economic Cooperation and Development (OECD) United States, 15-year-olds ranked 15th out of 23 industrialized countries in literacy and 21st in numeracy. In a new test of "problem-solving in technology-rich environments,” the U.S. ranked 17th out of 19.

The U. S. economy has a growing skills gap in which too many young adults lack the skills needed to become middle-class wage earners. By some estimates, 85 percent of new jobs are classified as “skilled.” Government has made it a priority to push for a STEM education — science, technology, engineering and math — to address the skills gap.

With millions of U.S. citizens unemployed or underemployed, why are 82 percent of manufacturers surveyed reporting a moderate or serious shortage in skilled workers? More than 75 percent of manufacturers say the skills shortage has negatively impacted their ability to expand and 69 percent of manufacturers expect the shortage in skilled production to worsen.

The Good News

U.S. companies are moving production back home, according to a new survey from The Boston Consulting Group (BCG). Respondents predicted the U.S. would account for an average of 47 percent of their total production in five years, reflecting a seven percent increase in U.S. capacity compared with last year’s results. BCG estimates that reshored production, along with rising exports, could create between 600,000 and 1 million direct manufacturing jobs by 2020. There is a multiplier effect of manufacturing jobs that reflects linkages that run deep into the economy, where 100 manufacturing jobs create 147 other new jobs.

Reshoring — the practice of bringing manufacturing and services back to the U.S. from overseas — is a fast and efficient way to strengthen the U.S. economy because it helps balance the trade and budget deficits, reduces unemployment by creating good, well-paying manufacturing jobs and fosters a skilled workforce. Reshoring also benefits manufacturing companies by reducing the total cost of their products, improving balance sheets and making product innovation more effective.

The Reshoring Initiative is focused on helping companies shift collective thinking from believing offshoring is cheaper, to understanding local reduces the total cost of ownership. The Initiative does this by assisting manufacturers and suppliers in making sourcing decisions by providing data on the reshoring trend and analytical tools to make better sourcing decisions.

The Plan

While the public agrees manufacturing is critical to reviving the economy, many would not recommend manufacturing jobs to their children. Students are not being prepared to — or even informed about — taking these jobs. A result of this is the manufacturing sector is facing a talent crisis of skilled professionals to sustain the current business base, let alone expand and grow the economy in the future. Manufacturers need to promote the image of “advanced manufacturing,” which offers a clean and safe environment that provides creative and highly skilled opportunities, with middle class wages and benefits.

A newly released report, “Building a Nation of Makers,” contains six bipartisan, action-oriented ideas  to accelerate the pace of innovation for America’s small- and medium-size manufacturers (SMEs). These recommendations wield transformative potential. Talent investment loans allow companies to expand their human capital. Upside-down degrees move the U.S. toward a more flexible education system with emphasis on skills in demand. Market surveys help disseminate the data required to enable stakeholders to understand their strengths and shortcomings and act on them.

A fully mapped supply chain will reveal new growth opportunities for SMEs. Certification programs give students a greater chance to both receive and qualify for meaningful employment in the new skills-based manufacturing economy. And finally, bringing the latest technology trends back to the manufacturing base will ensure SMEs have the tools to compete in the global economy.

To help deploy these recommendations and other best practices to build a nation of makers, the Association for Manufacturing Excellence (AME) has adopted a new vision for a “Manufacturing Renaissance” driven by “People Centric Leadership coupled with Enterprise Excellence.” AME has launched as one of its key results areas “Manufacturing as a Desirable Career Path” with a focus on “Adopting a School.” This initiative is being chaired by Glenn Marshall, retired from Newport News Shipbuilding (NNS) and a Career Pathways volunteer for NNS.

The adopt a school and or community college initiative focuses on helping them to graduate literate, career-ready citizens to join the workforce or go on to college. The AME Values Veterans (V2) team is energizing America’s economy by teaching employers how to rebuild their workforce through recruiting, hiring, training and retaining veterans.

AME is encouraging students to consider careers in manufacturing. Its Dr. Sherrie Ford Manufacturing as a Career Path 2014-2015 Scholarship supports and promotes manufacturing as a career path by providing scholarship opportunities for manufacturing career-minded individuals.   

AME is recommending schools deploy the Roadmap for Education Reform for Manufacturing produced by the Manufacturing Institute. The roadmap lays out six principles for innovative reform, including moving to competency-based education, establishing and expanding industry-education partnerships, infusing technology in education, creating excitement for manufacturing careers, applying manufacturing principles like "lean" to reduce education costs and expanding successful youth development programs.

The public schools and community colleges can provide an affordable answer for producing students with the right education and credentialing needed for a skilled workforce. A model for success comes from Career Technical Education (CTE) programs. “Learning that works for America” programs are organized by 16 Career Clusters™ and 79 Career Pathways.

Workforce development is the key to making “Made in North America” an economic reality. AME is joining with other leading learning organizations and is accelerating the deployment of a “Manufacturing Renaissance” strategic plan to bring young people, parents, educators, veterans, manufacturers and policy-makers together and by using the collective impact of the community to provide new “ladders of opportunity” for all of our citizens.  

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