Manufacturers Support Key Changes to Dodd-Frank

By | Shopfloor Policy | No Comments

Today, the House Committee on Financial Services held a hearing on draft legislation that would essentially repeal and replace the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act). Among other things, the bill, entitled The Financial CHOICE Act would eliminate or amend several provisions that have been harmful and costly to manufacturers.

Designed to be a Republican alternative to the 2010 Dodd-Frank Act, which Committee Republicans see as a drag on economic growth and access to capital, the Financial CHOICE Act includes several provisions of importance to manufacturers including repeal of the CEO pay ratio, conflict minerals and pay versus performance requirements as well as an amendment to the clawback requirement. Manufacturers have been struggling with how to comply with these costly and burdensome requirements since they were first put into the law nearly seven years ago. Read More

Soft Real GDP Growth in the First Quarter

By | Economy, Shopfloor Economics, Shopfloor Main | No Comments

The Bureau of Economic Analysis reported that the U.S. economy grew 0.7 percent at the annual rate in the first quarter, starting 2017 off on a soft start as expected. This follows real GDP growth of 2.1 percent in the fourth quarter. Weaker consumer and inventory spending in the first quarter could explain the lower figures, with government spending also serving as a drag on the headline number.

To be fair, this is just the first estimate, so there is a chance that future revisions might show better growth, particularly if incoming data for March are better than expected. In addition, we traditionally have a sluggish first quarter followed by a strong rebound in the second quarter. My current forecast is for 2.8 percent growth in real GDP in the second quarter, with the economy expanding 2.1 percent for 2017 as a whole. Of course, these estimates might drift higher with passage of more pro-growth policies, especially in terms of the outlook later this year and into 2018.

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ShopTalk Podcast: President Trump’s 100 Days of Reg Reform

By | Shopfloor Main, Shopfloor Policy, ShopTalk | No Comments

As manufacturers look to our nation’s leaders to rethink red tape and reduce the cost of doing business in America, regulations continue to be cited as a top issue. It has been over four decades since a President has addressed the regulatory burden in our country head-on and now as we reflect on the first 100 days of this new Administration, President Trump has presented a new and innovative approach to reducing regulations that has already begun to have a positive affect for manufacturers nationwide.

In the latest installment of our ShopTalk podcast, NAM SVP of Communications Erin Streeter sits down with NAM SVP of Policy Aric Newhouse and NAM VP of Labor, Legal and Regulatory Policy Rosario Palmieri to discuss the current regulatory playing field and what manufacturers can expect in the future.

Kansas City Fed: Manufacturing Activity Pulled Back in April from March’s Nearly Six Year Highs

By | Economy, Shopfloor Economics | No Comments

The Kansas City Federal Reserve Bank reported that manufacturing activity pulled back in April from March’s levels, which were the highest since March 2011. The composite index of general business conditions declined from 20 in March to 7 in April, even as it expanded for the fifth straight month. In general, manufacturers report improvements in activity, as noted in the selected comments; yet, they also mentioned the “slow first quarter” and some lingering global headwinds. In some ways, we might have expected some easing in sentiment from the euphoric measures in the prior release. Indeed, many of the underlying data points decelerated sharply in April from those highs, including new orders (down from 32 to 8), production (down from 37 to 12), shipments (down from 35 to 11) and employment (down from 13 to 9). Two other figures were mixed. Exports picked up very slightly for the month (up from 2 to 4), whereas the average workweek narrowed for the first time since November (down from 13 to -4). Read More

Growth in New Durable Goods Orders Eased in March but Expanded for the Third Straight Month

By | Economy, Shopfloor Economics | No Comments

The Census Bureau reported that growth in new durable goods orders eased in March but expanded for the third straight month. New orders rose 0.7 percent in March, increasing from $237.1 billion to $238.7 billion, a five-month high. However, significant escalations in defense and nondefense aircraft and parts orders, which can often be quite volatile from month to month, could explain much of the gain in March. Excluding transportation, new durable goods orders declined 0.2 percent for the month, edging down from $155.7 billion to $155.4 billion. Overall, new durable goods demand has continued to trend in the right direction after stalling for much of the past few years. New durable goods orders have increased 4.5 percent since March 2016’s $228.5 billion pace. Read More

Good News: Bipartisan Regulatory Reform Introduced in Senate

By | General, Shopfloor Main, Shopfloor Policy | No Comments

In the first 100 days of the Trump administration, manufacturers have seen many actions from President Trump to provide regulatory relief. Now, there’s good news coming from the Senate as well. Senators Rob Portman (R-OH) and Heidi Heitkamp (D-ND) have released the Regulatory Accountability Act, which, in their words is “designed to make federal regulations smarter and more effective so they better support businesses, families, and jobs by modernizing the federal regulatory process that hasn’t been significantly reformed in 70 years.”  Read More

What Justice Gorsuch’s Confirmation Means Immediately for Manufacturers

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On Monday, April 17, newly minted Associate Justice Neil Gorsuch took his seat as the 113th justice of the U.S. Supreme Court. Following a highly partisan and divisive Senate confirmation process, Justice Gorsuch likely found relief in the more cordial and genteel atmosphere of the court. With no time to spare on first-day jitters, the newest justice heard oral arguments on day one, waiting only 11 minutes before diving into questioning the advocates.

Justice Gorsuch is joining the Supreme Court near the end of the October 2016 term, with 13 arguments packed into the final weeks of April. Among the cases to be heard yet this term are two in which the NAM’s Manufacturers’ Center for Legal Action (MCLA) has played a role: BNSF v. Tyrrell and Bristol-Myers Squibb v. Superior Court of California. Both cases involve the issue of jurisdiction in state court when companies are based outside of that state and have no particular connection to the jurisdiction. The cases provide an opportunity for the court to clarify the reach of its 2014 holding in Daimler AG v. Bauman and to further rein in the problem of plaintiff forum shopping among state courts.

In addition to participating in oral arguments on these jurisdictional cases, Justice Gorsuch will also help to decide whether review will be granted in three cases the MCLA has supported with briefs advocating certiorari. These involve 1) whether states can alter their obligations under the Multistate Tax Compact; 2) whether courts may disrupt the “free and clear” provisions of bankruptcy law to allow claims against the bankrupt entity; and 3) whether due process is violated when jail time is imposed on corporate officers based on strict criminal liability in the absence of criminal intent.

Looking further ahead, three important manufacturing cases are already lined up for argument in the fall when the October 2017 term begins. Justice Gorsuch’s textualist approach will no doubt be felt in all three. These cases deal with the issues of 1) which court has jurisdiction for challenges to the Environmental Protection Agency’s definitions of bodies of water subject to the Clean Water Act; 2) the permissibility of class waivers in employment arbitration agreements; and 3) the scope of private rights of action under Securities and Exchange Commission disclosure rules.

The outcomes of all of these cases will benefit from consideration by a fully staffed panel of justices. While the court has done its best to keep cases moving over the past 14 months since the death of Justice Antonin Scalia, the business of the court has no doubt been hampered by the prospect of producing 4–4 ties that diminish the role of the Supreme Court by simply affirming the lower court’s holding while failing to make new law on issues important enough to have reached the court. At a time when political rancor and divisiveness are at a high point, it is a good thing for American democracy to have a full complement of justices and a fully functioning Supreme Court. Welcome Justice Gorsuch!

Increasing Agility with Business Aviation

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Click Bond, Inc. is recognized as an industry pioneer and a leading supplier of advanced assembly solutions to the aerospace industry. Today the company supports global leaders across the civil and military aircraft, unmanned systems and space vehicle manufacturing sectors. Click Bond’s adhesive bonded fastener products permit installation of systems and structural attachments without drilled holes, reducing customers’ manufacturing costs and improving the maintainability and longevity of their products.

General aviation users and passionate pilots from the start, Click Bond’s leaders have leveraged an increasingly capable succession of business aircraft to deliver the company’s signature responsiveness and support to an expanding customer base effectively. Click Bond President and CEO Karl Hutter talks with Member Focus to discuss how aviation works as a value-added business tool for his company and how it can work for others in the manufacturing sector.

Member Focus: Click Bond’s products are found in a multitude of industries. How do you stay connected to your different customer networks?

Hutter: Our customer base is located across the United States, and about 25 percent of our business is with international customers, predominantly in Europe, Asia and South America. Additionally, our growth has expanded our footprint; in addition to our headquarters in Carson City, Nev., we have a design and manufacturing presence in Watertown, Conn. and a small but growing adhesives facility in Saltney, Wales.

From Carson City, we access airline service through Reno, our closest commercial airport, although the number of nonstop destinations from there are limited. Reaching our primary company and customer sites typically requires one or even two stops with commercial travel. Our team, therefore, spends an unnecessary amount of time on the road away from home and at the mercy of connecting flights and delays.

This is a major driving factor in our continuing expansion of our corporate flight operations. Our customers value our commitment to responsiveness and support; it is a source of genuine competitive advantage. Agility is one of Click Bond’s core values, and business aviation is critical to our ability to deliver it.

Member Focus: As your business has grown and changed, how has your use of business aviation changed with it?

Hutter: My father, mother and I are pilots, and early on we utilized piston propeller aircraft—a Cessna 185 and then an Aerostar twin—for many of the company’s business trips. In the beginning, we’d have two people on a trip and fly short legs along the West Coast, calling on our customers in Los Angeles and Seattle. However, the increasing need to travel to places like Wichita, Kan.; Fort Worth, Texas; and Washington, D.C., demanded longer legs than what the Aerostar could provide practically.

We acquired the Connecticut facility, and our customer footprint continued to expand. Additionally, as programs grew in complexity, new teams of engineers and specialists needed to be in more places while staying connected to our operations in Carson City. That’s when we made the move to a Cessna Citation business jet. Today we make use of a fleet of three aircraft, including a Citation CJ3 jet for those longer coast-to-coast trips from Carson City to Watertown.

What was usually a two-stop, all-day journey—provided everything went right with connections—is now a five-hour, 15-minute nonstop flight departing right from our own backdoor. This aircraft has been a game-changer from a mission profile and economic standpoint, and the reliability for our team—and customers—is unparalleled. 

My father and I are both certified to fly the Citation, and we personally fly many of these trips, either solo or working as a crew with Jere Marble, our pilot and manager of flight operations and maintenance. He keeps the operation running smoothly and safely.

Member Focus: What has business aviation enabled your company to do?

Hutter: With our need to reach across the continent quickly and reliably, it fills the gaps commercial travel can’t, both in terms of efficiency and flexibility. The economics and payload capabilities of the larger Citation have allowed us to include an increasingly diverse group of teammates on board, representing many disciplines.

That means we can go beyond just having a limited group of senior people at a meeting or a plant visit. It allows me to expose more employees to their customers and their work. They’re not only communicating with customers over the phone or corresponding via email, but they’re also on-site, seeing the successes and the challenges firsthand. This valuable face time builds knowledge of the environments where our products are used and enhances the connection between our employees and the customers we serve.

As a company that puts customer support at the center of what we provide—from rapid turnaround of engineered solutions and prototypes to responsive on-site training and customer support—we view the capability that business aviation provides to our team as essential.

Right now we have the perfect aircraft for our mission, at least until our business drives a great need for intercontinental travel.

Member Focus: General aviation is still gaining traction in the manufacturing industry as a useful business tool. How do your customers view your use of aircraft?

Hutter: Many of our customers have roots in the aviation and aerospace industry, and they know and love that we are true aviation enthusiasts. Click Bond’s aircraft ownership and operation demonstrates that passion, but more importantly, puts us in our customers’ shoes. When we meet with Textron Aviation, for example, our contacts in engineering know we bring not only a supplier/partner perspective but also a customer perspective, and that we recognize the importance of the quality and reliability of their product to their customers, and that our own products must enable that.

Member Focus: What’s your advice for a manufacturer considering business aviation to expand its footprint?

Hutter: Definitely be thoughtful about where you are pounding in stakes—the investment in a plant, a workforce and a community is one of the strongest commitments that you will make. Ensure that the place in which you choose to land has the access to customers, material and other resources that you will need to be successful. Don’t rule out wonderful communities that may offer tremendous advantage but don’t have a robust commercial air service. That’s where business aviation proves to be a valuable asset.

A capable general aviation airport, coupled by your company’s use of business aviation, can make them not only practical places to base your operation but also unlock locations that might be the source of competitive advantage that others might never find.

 L to R: Click Bond founders Charles Hutter and Collie Hutter and President and CEO Karl Hutter in front of the company’s Citation CJ3 business jet

President’s Tax Plan Will Create Opportunity Improve Lives

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Washington, D.C., April 26, 2017 – National Association of Manufacturers (NAM) President and CEO Jay Timmons issued the following statement on President Donald Trump’s proposed tax reform plan:

“President Trump has listened to those who feel they work harder today for less or are out of a job. The president delivered on his commitment to put the force of the White House behind policies that will grow the manufacturing economy in the United States and raise standards of living for everyone in our country.

“By modernizing our tax code and making it more competitive, manufacturers—and all businesses—will find it easier to invest their next dollar and create their next job here in the United States. It can mean more jobs, better jobs and more money in their paychecks. It means lifting more people up and empowering more Americans to improve their lives.

“This is yet another item on President Trump’s list of accomplishments in his first 100 days. Of course, the work doesn’t end today. Manufacturers are committed to working with the administration and Congress to ensure the best possible pro-growth tax reform plan reaches President Trump’s desk. The NAM has waited decades for tax reform, and the need is more urgent than ever.”

-NAM-

The National Association of Manufacturers (NAM) is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12 million men and women, contributes $2.17 trillion to the U.S. economy annually, has the largest economic impact of any major sector and accounts for more than three-quarters of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the Manufacturers or to follow us on Shopfloor, Twitter and Facebook, please visit www.nam.org.

NAM Moves Forward a Positive Discussion on NAFTA

By | Shopfloor Policy | No Comments

On April 26, NAM Vice President of International Economic Affairs Linda Dempsey participated on a Farm Foundation panel on the Future of the North American Free Trade Agreement at the National Press Club in Washington, DC. Dempsey was joined by Bob Stallman, former president of the American Farm Bureau Federation and Melissa San Miguel, Senior Director of Global Strategies at the Grocery Manufacturers Association.

In her remarks, Dempsey explained the importance of the existing North American market for manufacturers in the United States and how millions of manufacturing workers and thousands of manufacturing firms depend on exports to Canada and Mexico. Dempsey also outlined a number of key principles that are critical for manufacturers in renegotiated agreement, including: strong rules that reflect U.S. principles, law and values; strong intellectual property and digital economy rules; updated provisions that promote growth and competitiveness; the need to help, not hurt, America’s industries and workers; and the importance of concluding any NAFTA renegotiations in a timely manner.