From cutting edge advancements in automobile production to lifesaving developments in medical devices and medicines, Michigan manufacturers are global innovators and at the top of their game. As detailed in the NAM’s recent economic analysis, the manufacturing industry in Michigan spent $17.2 billion on R&D in 2015 – ranking it 4th nationally. One key to this success is ensuring all manufacturers’ intellectual property rights continue to be protected.
Unfortunately, legislation currently being debated in Lansing threatens manufacturers’ intellectual property protections. House Bill (HB) 5223, a proposed drug pricing transparency bill, would require manufacturers that distribute prescription medicines in Michigan of a certain cost to submit a substantial amount of proprietary data, including costs associated with research and development (R&D), to the state Department of Health and Human Services, with no protections for the data submitted.
Manufacturers understand the need to reduce health care costs, but we have serious concerns related to the long-term implications of pharmaceutical transparency proposals. Protection of trade secrets and other forms of intellectual property are a fundamental necessity for manufacturers to succeed in today’s intensely competitive global marketplace.
The latest proposal in Michigan sends a wrong signal to the researchers, inventors and innovators who constitute the manufacturing community in Michigan and the rest of the nation who are constantly thinking of new ways to innovate, grow their businesses and serve their customers. For the biopharmaceutical industry, this kind of so-called “transparency” legislation would stifle innovation and impede the ability of companies to bring new, life-saving medicines to market all while failing in its intent to contain health care costs.
Policymakers in Michigan and at the federal level should work to create opportunities that help innovators attract and retain investment. The NAM opposes any efforts that invalidate longstanding intellectual property and trade secrets protections, and force manufacturers of medicines to heed new government-driven demands that are contrary to basic free market principles.
The manufacturing industry employs over 604,500 Michiganders in high-skilled and high wage jobs – the nation’s third highest manufacturing state measured by employment. State lawmakers who value these critical jobs and the state’s innovative manufacturing sector should reject the proposed legislation.
The simple question that should be asked during each opportunity to consider a health care reform proposal should be, “at what expense?”
“Manufacturers rely on the nation’s air transportation system to help support business competitiveness, efficiency and growth.”
“A draft framework was released by the Committee that offers an important, actionable vision…”
Approximately 426,000 U.S. manufacturing jobs are going unfilled today because there simply are not enough qualified applicants to fill them. This is a big problem, the so-called “skills gap,” and it threatens not only the future of the manufacturing industry but of our economy more broadly. Worse, unless we do something to reverse this trend, that number of unfilled jobs is projected to rise to 2 million over a 10-year period. So what can we do?
That was the question before lawmakers today at a House of Representatives committee hearing titled “Jobs and Opportunity: Employer Perspectives on the Jobs Gap.” Among the expert witnesses called to testify before the Ways and Means Subcommittee on Human Resources were representatives of several National Association of Manufacturers (NAM) member companies.
Glenn Johnson, manufacturing workforce development leader at BASF Corporation, helped identify the challenge in his testimony:
“Recently, there has been national discussion around the ‘Jobs Gap.’ There are numerous studies announcing the shortage of American workers that possess hirable skills within manufacturing and other industries with technology roles. However, if we are to solve this issue, we must treat the root cause, not the symptom. The lack of skilled workers, for example, is a symptom. The root cause, however, is much more basic. In this country, we have allowed a narrative to develop that the “best” jobs are no longer in manufacturing, but in white-collar, office settings – although these jobs are also essential to manufacturing.”
This, of course, is a real problem. And yet, as Fiat Chrysler’s Head of Human Resources Barb Pilarski explained in her comments:
“First, our high school education system does not adequately expose students – especially those who may not be interested in a four-year college degree – to the manufacturing sector and the attractions of careers in this area. Second, this same education system has been inconsistent in terms of providing all graduating students with the skills to keep pace with the evolution of the [industry]….”
Both Johnson and Pilarski offered ideas on how to overcome these problems. So did Steve Staub, president of a small manufacturing company called Staub Manufacturing Solutions in Dayton, Ohio. You may remember Steve from his appearance at the State of the Union earlier this year as a guest of the First Lady. Well, as Steve explained in his testimony, small companies like his are roaring back and growing at a rapid pace—thanks in many ways to pro-growth policies out of Washington, like tax reform—but they simply are not able to find enough workers to keep pace with all the new openings they need to fill. And, as Steve reminded us:
“Today’s manufacturing industry is modern, high tech, alive and growing, and it offers many promising career options—often, I should add, without the financial burdens that students and families face today….The average manufacturing worker earns about 27 percent more in wages and benefits than the average worker across all sectors.”
He explained what companies like his, educational institutions, organizations like the NAM and others are doing to take on the “skills gap” challenge as well as what Congress can do to help. I hope you’ll take a moment to check out his full testimony here.