Manufacturing continues to be one of the most important bellwethers regarding the health of the U.S. economy, and the prospects for growth remain robust over the next decade. After a sluggish few years, manufacturing is humming along nicely once again, and business leaders in the sector are very optimistic about their company outlook. This includes healthy expected increases in sales, production, exports and employment. In fact, the ability to attract and retain a quality workforce was in a virtual tie in the latest National Association of Manufacturers survey as the top concern among manufacturers, cited by nearly 72 percent of those responding.
Yet, analysts continue to posit that manufacturing is less important to economic growth today than it once was. After all, they suggest, manufacturing accounts for almost 12 percent of GDP today, down sharply from 31 percent 50 years ago, and employment in the sector is a smaller share of the total pie. Moreover, conventional wisdom is that manufacturing is in “decline,” a trend that will no doubt continue moving forward, many argue. Along those lines, the most recent occupational projections from the Bureau of Labor Statistics forecast a 0.6 percent decline in manufacturing employment over the next decade, making it one of the laggards in the economy as it relates to job growth.
Yet, such flawed analysis undersells how important manufacturing is for overall economic growth. Manufacturers contributed more than $2.2 trillion to the U.S. economy in the most recent data, demonstrating how intertwined manufacturing firms are with the rest of the economy. Indeed, business leaders often tell me about the hundreds or—for larger firms—thousands of suppliers they interact with every single day.
Manufacturing has the highest multiplier effect of any major sector. For every dollar spent in manufacturing, another $1.89 is added to the economy, and for every manufacturing worker, there are another four employees hired elsewhere. Indeed, shifts in manufacturing can affect the larger economy significantly. More importantly, millions of Americans rely on manufacturing as a path to the middle class. There are 12.45 million manufacturing workers, with average compensation of $82,023 in 2016, including pay and benefits.
Beyond those figures, we know that manufacturers have hired nearly 1 million additional workers on net since the end of the Great Recession, and there were nearly 400,000 job openings in the sector in the latest monthly data. In addition, a recent study by Deloitte and The Manufacturing Institute found that manufacturers will need to hire 3.5 million workers between now and 2025, largely to replace those individuals who are retiring and to account for growth in the sector, but because of worker mismatches, firms will struggle to fill 2 million of those jobs.
Meanwhile, the United States is seen increasingly as a viable location for global manufacturers, with foreign direct investment in the sector exceeding $1.5 trillion in 2016, an all-time high. In addition, new technologies have the ability to alter radically the way manufacturers innovate, produce and sell their products moving forward, improving efficiency and competitiveness.
In fact, manufacturing today is more globally competitive, and I continue to be quite bullish about its long-term prospects in the United States. This includes employment growth. With more technology and an always-evolving sector, the workforce will likely change dramatically, a trend that we have already seen take place. Manufacturing is more advanced today and so is its workforce.
The employee mix 10 years from now will likely look completely different from today—much like the sector itself. We will need more workers in the trades but also more high-tech employees with science, technology, engineering and math skills. We need more women and military veterans to pursue a career in manufacturing to expand the potential workforce available to manufacturers and to help close the skills gap. And we need to change perceptions about how advanced modern manufacturing really is.
The future of manufacturing is bright, with the sector on the cusp of transformative changes that will help it better compete and prosper for years to come. That should not only benefit employees and the overall economy but also require new thinking about what the workforce of the future in manufacturing really looks like.
Earlier this month, the National Association of Manufacturers, The Manufacturing Institute and Arconic Foundation hosted a STEP Forward Google Hangout, where an expert panel focused on how to attract and retain women in the manufacturing industry. STEP Forward is the Institute’s initiative to empower women in manufacturing and inspire the next generation of female talent to pursue careers in the industry. During this live virtual session, the panelists told their own stories and shared best practices covering a range of topics like the importance of getting men involved in the conversation, showcasing females in leadership positions and exposing young women and parents to modern manufacturing careers.
Manufacturers across the country are struggling to fill open positions. And one critical barrier to filling these jobs is that too often women aren’t seeing that there is a place for them in today’s manufacturing. Many outstanding women leaders are making huge strides in impacting this industry and are demonstrating what modern manufacturing offers—rewarding and fulfilling careers with limitless opportunity for growth. Today’s manufacturing employees are building and designing the future, and women in manufacturing serve as ambassadors to move this industry forward.
Research shows women are more likely to look for careers that offer personal and intellectual growth. In fact, women ranked opportunities for challenging and interesting assignments as a top priority when considering their career. Modern manufacturing provides women with opportunity for advancement and long-lasting careers in a range of sectors. On the STEP Forward Google Hangout, the panelists expressed how rewarding it is to be a maker and create products that Americans use every day to increase our standards of living.
Knowing the importance of a diverse workforce, the Institute is promoting the role of women in manufacturing through the larger STEP Ahead initiative, which serves to mentor and recognize women in this critical sector while also leading research efforts tackling this important topic. STEP Ahead honorees and emerging leaders are motivating women to choose careers in manufacturing, and over the past five years, those awarded have impacted more than 300,000 individuals, from peers in the industry to school-aged children.
Manufacturers today must collaborate and work together to diversify the current and future workforce. Showcasing the reality of manufacturing to young women is a huge step toward bridging the skills gap and allowing the industry to reach its full potential. Watch the STEP Forward Google Hangout to hear the insightful discussion on exposing women and the next generation to the opportunities available in manufacturing and continue to follow the conversation at #MFGwomen.
As I think about iconic manufacturing women in history, I think about how much we have accomplished and how much potential we have to grow. Some of the greatest inventors, creators and leaders in this world are women. In 1871, Margaret Knight was awarded her first patent for a machine that cut, folded and glued flat-bottomed paper shopping bags. In 1903, Mary Anderson invented and patented the windshield wiper. In 1908, Melitta Bentz received a patent for the coffee filter system. And in 1942, Hedy Lamarr invented a remote-controlled communications system for the U.S. military during World War II. Her frequency hopping theory now serves as a basis for modern communication technology, like Bluetooth and Wi-Fi. These women were preceded and followed by many more.
These women before me have forged a path for my career and success in this industry. I have always been fascinated by how things work, so I intentionally sought a career at a manufacturing company whose products transform the world. It’s helped me to understand the impact of industry beyond our national doorstep. One of the best things about my job is touring our facilities and watching raw materials become products; I am still awed by the deep science and engineering collaboration that allow Arconic’s innovations to emerge. That is the feeling I want every girl sitting in a science or math class to know—that each of them can help invent the next frontier of technology.
As chair of the 2018 STEP Ahead Awards, I recognize the significant impact present-day women have made on this industry. Over the past five years, STEP Ahead Award winners have impacted more than 300,000 individuals, from peers in the industry to school-aged children. With that alone, we know these STEP Ahead women have played a part in attracting, retaining and advancing high-quality female talent in manufacturing, laying the groundwork for future visionaries, trendsetters and go-getters.
While there is an underrepresentation of women in the industry, I firmly believe that women will continue to rise to the occasion and create greatness—just as we have for centuries. Where would we be without the Hedy Lamarr’s or the Margaret Knight’s of the world? Where would we be without these thought leaders and innovators that have changed our lives as we know it? I am proud to be a part of an industry where women have played a significant part in shaping our current livelihood and will shape the future.
Read the latest CNBC column on closing the skills gap by U.S. Secretary of Commerce Penny Pritzker in this month’s Member Focus.
If manufacturing in the United States were its own country, it would rank as the ninth-largest economy in the world, with manufacturers contributing $2.09 trillion to the U.S. economy every year.
Every dollar spent in the manufacturing sector adds another $1.37 to the economy and each manufacturing job creates another 2.5 jobs in local goods and services.
Read more here.
You may know him from “Dirty Jobs,” but today Mike Rowe was on Capitol Hill today testifying on anything but. Rowe hit the Hill today to speak before the House Resources Committee hearing, on “American Energy Jobs: Opportunities for Skilled Trades Workers.”
His resource center, mikeroweWORKS, launched in 2008, mirrors many of the initiatives undertaken by the NAM and the Manufacturing Institute. We’re all about challenging thing stereotypes that surround manufacturing and ensuring that our nation knows that a manufacturing job means a good paycheck, benefits, and a career on the cutting edge. The skills gap that has left hundreds of thousands of jobs unfilled is making America less competitive. The NAM and the Institute are working to get our nation’s youth the skills and certifications they need to achieve their goals. And while we do that, we’re changing people’s perception of manufacturing, a step at a time.
People like Mike Rowe, who lend their voice to this critical effort, deserve our applause and appreciation. Together, we can show the world that manufacturing in the U.S. is sleek, technology driven, and a pretty great place to make your career.
Veterans enter the civilian workforce every day. Unfortunately, there are more veterans than open jobs—as a roughly 8 percent unemployment rate among veterans indicates.
After bravely serving our country, veterans deserve a hero’s welcome. They also deserve a good job, and manufacturers are stepping up to make that happen. Across the country, manufacturers are looking for ways to introduce veterans to manufacturing and get them to work.
Take Hoerbiger Corporation of America. When the Florida-based manufacturer saw a need for skilled machinists, it saw veterans as a natural fit. As the Sun-Sentinel reports,
[E]arlier this year the company developed a training program to fill the gap and began recruiting veterans.
They tend to exhibit “maturity, discipline, tenacity and an ability to get the job done,” said David Gonzalez, the company’s human resources manager. He recruited veterans in May at the Paychecks for Patriots job fair in Dania Beach.
The result: Seven of the 12 machinists put through the program are military veterans.
To help train these individuals, Hoerbiger turned to another manufacturer and a cutting-edge educational system.
Hoerbiger trained the group with the help of new machine simulation software by Machining Training Solutions, a Longwood, Fla., company operated by Al Stimac, president of the Manufacturers Association of Florida. Ten to 12 workers can be trained at a time with the interactive software.
“My whole concept was to train using the methods that students are used to, such as today an iPad or a computer. The learning curve is reduced drastically,” Stimac said.
There are similar stories across the country. The National Association of Manufacturers through the Manufacturing Institute is working with a number of manufacturers are part of the Get Skills to Work program. This initiative matches the skills veterans received in the military to skills coveted by manufacturers. If veterans need to learn new skills, the Institute and its partners can help them earn those credentials through partnerships with community colleges and other educational institutions.
Manufacturers are helping veterans transition from the military in other ways as well. In addition to its efforts to recruit veterans to its workforce, Whirlpool Corporation recently became the official appliance sponsor of Homes for Our Troops, a non-profit initiative dedicated to building homes for severely injured veterans.
It’s the least manufacturers can do for the men and women who make great sacrifices to safeguard our freedom.
Manufacturing in the United States is being transformed by new technology that has made our workers the most productive in the world. The pace of change is constant and presents significant challenges. Even in today’s struggling economy, 600,000 manufacturing jobs are unfilled because employers can’t find people with the right skills.
Jennifer McNelly, president of The Manufacturing Institute, was a featured speaker on how to close the skills gap and train a 21st century workforce at the Washington Post Live’s “America’s New Manufacturing” event today sponsored by NAM member company Siemens.
McNelly joined an array of top experts who are actively engaged in the transformation of manufacturing in America including Siemens Corporation President and CEO Eric Spiegel; Former Assistant to the President for Manufacturing Policy Ron Bloom; Mayor Anthony Foxx of Charlotte, NC; Export-Import Bank Chairman and President Fred Hochberg; and Tennessee Governor Bill Haslam.
McNelly spoke about the Manufacturing Institute’s leading initiatives to help close the skills gap, including its Manufacturing Skills Certification System of industry-based, portable and stackable credentials that validates the skills of incoming workers. She also spoke about the great work the Institute is doing with GE, Boeing, Lockheed Martin, Alcoa and other partners to train returning military veterans for jobs in advanced manufacturing.
All the speakers agreed that with the right policies in place, this next era of manufacturing is an opportunity to secure America’s economic future.
Across the nation, manufacturers are unified in emphasizing the need for a strong technical workforce to meet the needs of advanced manufacturing. Today the Senate Subcommittee on Competitiveness, Innovation, and Export Promotion held a hearing to highlight that need titled, “Promoting American Competitiveness: Filling Jobs Today and Training Workers for Tomorrow.” We are pleased to see the subcommittee attempt to address this serious concern.
The President of the Manufacturing Institute, Jennifer McNelly, testified at the hearing, highlighting that the best way to train workers for job in an advanced technical economy is to ground that learning in industry-based credentials in coordination with secondary and post-secondary educational institutions. The testimony, which was well-received by the Committee, pointed out,”… we need a new strategy for our manufacturing workforce, grounded in industry standards, with new and renewed cooperation with industry, education, economic development, and the public workforce investment system.”
As Subcommittee Chair, Senator Klobucharstated in her opening statement, “…this is not your grandfather’s voc-tech.” Growing our national technical workforce will keep manufacturers competitive and growing in the US.”
In a time of high unemployment it seems unfathomable that manufacturers are struggling to fill jobs – but that is exactly what is happening across the country. Manufacturers have reported a significant disparity between the number of skilled workers they need to continue to grow their businnesses and the worker pool available to them. An article in today’s Washington Post hightlights this unfortunate phenomenon.
“A recent report by Deloitte for the Manufacturing Institute, based on a survey of manufacturers, found that as many as 600,000 jobs are going unfilled. By comparison, the unemployed in the United States number 12.8 million, according to the Bureau of Labor Statistics.
‘High unemployment is not making it easier to fill positions, particularly in the areas of skilled production and production support.'”
The Manufacturing Institute has been focused upon solving this very problem – working to implement the “Right Skills Now” program to help individuals gain the skills and certification they need to acquire good paying, high quality manufacturing jobs.