Labor Department Takes Significant Step to Reduce the Cost of Retirement Plans for Small Manufacturers

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Labor Department Takes Significant Step to Reduce the Cost of Retirement Plans for Small Manufacturers

Earlier this year, President Trump issued an executive order requiring the Department of Labor (DOL) to take steps to expand the ability of small businesses to join with other companies to offer a single retirement plan for their employees, effectively reducing the cost of offering retirement benefits. Today, the DOL released a proposed rule to implement the executive order and enable small businesses to join with industry or local partners via a business association to offer retirement benefits to their employees.

A manufacturer that wants to offer their employees retirement benefits must address substantial administrative costs associated with such plans, which makes it difficult for small businesses to offer these benefits. In fact, less than half of American workers at companies with fewer than 50 employees have access to a workplace retirement plan.

The DOL’s proposal would reduce costs by allowing similarly-situated small businesses (connected by either geography or industry) to band together through a trade association or local business group to offer a single retirement plan, thus benefiting from economies of scale.

While additional rulemaking from the Treasury Department is necessary to fully implement these “pooled” retirement plans, the DOL’s action is a significant step toward allowing small manufacturers to use competitive 401(k) plans to attract talent in a tightening labor market. It’s also fantastic news for manufacturing workers. The higher fees charged by administrators of small employer plans can cut nearly one percent off a workers’ retirement savings. Compounded over a lifetime of investing, that’s a significant loss – which will be eliminated under the new rule. That’s a win for manufacturing workers across the country.

Greenhouse Gas Emissions Declined 3 Percent Last Year. It’s a Sign Manufacturers Are Keeping Their Promise.

By | Environment, Presidents Blog, Shopfloor Main, Shopfloor Policy | No Comments

In 2017, manufacturers advocated—and our leaders in Washington delivered—much-needed regulatory relief. Despite what the critics said, we promised that strong economic growth and responsible environmental stewardship can go hand in hand.

There’s no doubt 2017 was a banner year for economic growth and job creation. But now we have proof that it was a good year for environmental stewardship as well: greenhouse gas emissions in the United States declined nearly 3 percent.

The Hill reports the findings from the EPA:

“Harmful greenhouses gases that largely contribute to climate change decreased during President Trump’s first year in office, according to a new Environmental Protection Agency (EPA) report released Wednesday.”

This is great news for the country. Of course, manufacturers have a track record of improving our efficiency and sustainability while growing the economy. Over the past decade, manufacturers have decreased our greenhouse gas emissions by 10 percent while increasing our share of the economy by 19 percent.

Going forward, we will continue to prove the naysayers wrong. We will keep our promise to hire more workers, invest here in America and increase wages and benefits—all while building a future with cleaner air, cleaner water and a healthier environment.

Manufacturers Are Paving the Way as Environmental Stewards

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Manufacturers take environmental stewardship seriously. As outlined in an op-ed that ran just this morning, manufacturers are looking to the future and leading by example through the implementation of sustainable practices and reducing their environmental footprint.

With the National Association of Manufacturers’ (NAM) most recent economic outlook survey—released last week—underlining the industry’s strong economic optimism, manufacturers are taking the opportunity to not only invest more, grow their workforces and increase salaries but also embrace practices that protect the environment. One way this commitment is being demonstrated is through the NAM’s Sustainability in Manufacturing Partnership with the Department of Energy’s Better Plants Program. Launched on April 10, this partnership has provided a national platform for manufacturers to highlight their company’s projects, encourage the adoption of energy-efficient and sustainable practices and explore emerging technologies and evaluate future challenges that need to be addressed.

Moreover, when the NAM recently surveyed its member companies on sustainability, the numbers came back overwhelmingly positive. Not only do 93.8 percent report tracking energy usage and 81 percent report tracking water consumption, but 74 percent report they have a recycling program in place to do something about it, and 72 percent of manufacturers report they have a sustainability policy in place to do something about it (another 8.3 percent have programs under development). What are they doing? Well, as the op-ed notes, you can check out Manufacturing a Sustainable Future to see many different examples. The op-ed contains a few examples itself, for instance:

“When wallboard waste comes back to USG Corporation’s Rainier, Ore. plan, a machine separates the gypsum core from the paper. The paper is then sent to a local dairy farm, where it’s used for bedding, while the recovered gypsum goes back into the manufacturing process to be recycled into new wallboard . . . ”

“Union Pacific reduced its energy consumption by 3.8 million kilowatt hours in 2017—enough to power more than 400 American homes for a year.”

With an eye toward the future, the NAM is once again proving that modern manufacturing in America is synonymous to innovation, investment and environmental stewardship. We know that manufacturers will continue to keep their promises, too, because they remain committed to safeguarding the health and longevity of our planet and its people.

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