Today Alcoa celebrated the groundbreaking of construction for its new $90 million aluminum lithium facility in Lafayette, IN. Alcoa is the world’s leading producer of primary and fabricated aluminum.

The new state-of-the-art facility will be an 115,000 square foot expansion capable of producing more than 20,000 metric tons of aluminum lithium. The new facility will create approximately 75 high-value jobs, with an additional 150 jobs created during the construction.

Alcoa’s decision to invest in a new facility is a perfect example of how manufacturers are leading innovation here in the United States. Manufacturers are driving our economic recovery and it’s great to see manufacturers continue to expand and create new jobs.

What manufacturers need now is more pro-growth policies from Washington that will allow companies to invest in new facilities such as this and employ more workers.  We need more stories like today’s groundbreaking of Alcoa’s new facility. Such projects will ensure that the U.S. remains competitive in the global manufacturing economy.

Today Treasury Secretary Tim Geithner will tour NAM member company Marlin Steel Wire in Baltimore and meet with NAM Board Member and President Drew Greenblatt. The Secretary Geithner is expected to discuss President’s “to do list” for Congress which includes his proposed new hire tax credit.

Before touring Marlin Steel Secretary Geithner addressed the Greater Baltimore Committee where he talked about the need for spending cuts and other measures to help the economy.

Manufacturing continues to receive a lot of attention and deservedly so as the sector has been the engine behind our economic recovery creating 481,000 jobs since January 2010. But manufacturers are looking to policy makers like Secretary Geithner to help implement policies which will enable them to continue to grow. Our blueprint to keep manufacturing competitive, A Manufacturing Renaissance: Four Goals for Economic Growth, lays out key policies that Congress and the Administration can enact to keep manufacturing in the United States strong.

Today the House Small Business Committee held a hearing titled “U.S. Trade Strategy: What’s Next for Small Business Exporters?” The first panel of the hearing included testimony from Deputy USTR Miriam Sapiro discussing the status of current trade negotiations and the overall strategy to help small businesses reach new markets.

Also testifying at the hearing was Thermcraft, Inc. President Thomas Crafton from Winston Salem, North Carolina. Mr. Crafton was there to share with the members of the committee some recommendations to help increase exports to create manufacturing jobs.

Thermcraft, Inc. President Thomas Crafton testifies before the House Small Business Committee.

Mr. Crafton discussed during his testimony the obstacles that Thermcraft still faces when exporting, such as obtaining consistent and reliable information and help from federal government representatives stationed overseas:

On the flipside, we have export issues that arise on a daily basis and continue to be an ongoing struggle. For example, it can be difficult to get consistent and reliable information and help from the local representatives stationed abroad. Commercial Officers seem to see only the big picture and often fail to address the details and help small businesses through the ongoing process of exporting. Regulatory changes are constant, and the burden lies on us to keep up with those changes and decide on classifications for specific products. There is a lack of a single source for info regarding export embargoes. They are listed across multiple websites that take countless hours to research, and it is difficult to know if all requirements have been addressed.

He also mentioned the importance of fee trade agreements and the need to continue to reach new markets for manufacturers as well as the opportunities the Russian market presents: (continue reading…)

The Federal Reserve Board reported that industrial production rose 1.1 percent in April, its fastest pace since December 2010. After falling in March by 0.6 percent, this represents a healthy turnaround. The numbers were lifted by strong showings in the utilities and mining industries, which were up 4.5 percent and 1.6 percent. Overall capacity utilization for all industries has risen to 79.2 percent, its highest level since the spring of 2008.

Manufacturing production increased 0.6 percent, aided by a 1.3 percent rise in durable goods production. Nondurable goods manufacturers experienced a 0.2 percent decline in production in April. Manufacturers have produced 5.8 percent more on a year-over-year basis. Meanwhile, manufacturers’ capacity utilization increased to 77.9 percent, essentially on par with the February reading of 78 percent.

Motor vehicle sales were the largest bright spot in the manufacturing sector, with production up 3.9 percent in April. This continues a steady gain for the auto sector, which has seen a 27.1 percent increase in activity since April 2011. Other sectors with higher production in April include furniture and related products (up 2.4 percent), computer and electronic products (up 1.6 percent), miscellaneous durables (up 1.5 percent) and aerospace (up 1.1 percent).

The largest declines were seen in petroleum and coal products (down 2.6 percent) and wood products (down 1.4 percent). In each case, though, the year-over-year production numbers were higher for 16 of the 19 major manufacturing sectors. Those lagging in production over the past 12 months include the printing and support, paper and apparel and leather sectors. (continue reading…)

On the memorable day that the U.S.– Colombia Trade Promotion Agreement has at long last gone into effect – eight years after its negotiation started, it is useful to recall how beneficial Free Trade Agreements (FTAs) are, and have been, for America’s manufacturers. Far from being the drag on the U.S. economy claimed by many detractors of our trade agreements, these agreements have been a boon for manufacturers in the U.S. and factory workers – as well as for farmers and service providers.

Accounting for just 12.5 percent of Gross Global Product outside the United States, America’s FTA partners (counting Korea, the agreement with which went into effect last year) have accounted for a remarkable 52 percent of the growth of U.S. manufactured goods exports so far this year.

Exports to them are growing faster than to non-FTA partners.  Through March, U.S. manufactured goods exports to FTA partners were 13 percent larger than for the same period of 2011.  Our manufactured goods exports to non-FTA partners during the same time grew 10 percent – meaning that exports to FTA partners grew one-third faster!

And, confounding trade critics, manufactured goods trade with FTA partners has been in surplus for several years – meaning we sell them more manufactured goods than they sell us.  According to the U.S. Department of Commerce’s International Trade Administration FTA report, counting Korea our manufactured goods surplus with FTA partners was $7.5 billion in 2010, $29 billion in 2011, and so far in 2012 was at an annual rate of $47 billion.  In the coming months, the new Colombian agreement will add even more to that figure.

Counting the newly-implemented Colombian agreement, the proportion of Gross Global Product outside the United States accounted for by our FTA partners rises from 12.5 percent to 13.1 percent – but that leaves 86.9 percent of World GDP outside the United States as markets without FTAs with us, markets with trade barriers limiting our exports.  It is high time to open those markets so more American workers can be employed producing high-quality U.S. products to be sold around the world. 

Frank Vargo is vice president for international economic affairs, National Association of Manufacturers.

The Census Bureau reported that retail sales rose 0.1 percent in April, following strong gains in the first three months of the year. At least some of this pullback could be due to the unseasonably warm winter, which resulting in construction occurring earlier in the year than normal. As evidence of this, retail sales of building materials dropped 1.8 percent in April, a reversal from the 2.7 percent gain in March.

Other sectors with declining sales included clothing and accessories (down 0.7 percent), gasoline stations (down 0.3 percent) and general merchandise (down 0.1 percent). Nonetheless, there were areas of strength, too. The strongest monthly sales growth occurred with nonstore retailers (up 1.1 percent), furniture and home furnishings (up 0.7 percent), sporting goods and hobbies (up 0.7 percent), motor vehicle and parts (up 0.5 percent) and food service and drinking places (up 0.4 percent).

Year-over-year growth in retail sales currently stands at 6.4 percent, a slower pace than in past months. Six months ago in October, the annual rate of growth for retail sales was 8 percent.

These numbers suggest modest growth in retail sales overall. The slower pace in April was mostly due to seasonal factors as well as lower gasoline prices. So, it is important not to read too much into the easing of retail sales figures. Americans continued to grow their spending in other categories, with nonstore retailers leading the way.

Chad Moutray is chief economist, National Association of Manufacturers.

Today the Senate is expected to consider H.R. 2072 to reauthorize the Ex-Im Bank along with several amendments. The NAM has sent a Key Vote letter to senators urging support for the Bank which is so critical to small and medium-sized manufacturers.

Below is an excerpt from the Key Vote letter:

The Ex-Im Bank levels the playing field for U.S. exporters by matching credit support other nations provide, ensuring that our nation’s manufacturers can compete based upon the price and performance features of their products. It also enables small and medium-sized manufacturers to capture new markets in emerging economies abroad. In FY2011, the Bank supported more than $41 billion in export sales from more than 3,600 companies, supporting approximately 290,000 export-related American jobs.

Manufacturers are urging all senators to support H.R. 2072 to reauthorize the Ex-Im Bank and to increase its lending authority.

Consumer prices were flat in April  according to the Bureau of Labor Statistics. Energy costs fell 1.7 percent in April, partially offsetting the run-up in the first three months of the year. Food costs were 0.2 percent higher for the second month in a row, with 3.1 percent inflation for food over the past twelve months.

Core inflation, which excludes food and energy costs, rose 0.2 percent in April. On an annual basis, overall and core prices have both risen by 2.3 percent. Core inflation has stayed around that range for the past few months. While this exceeds the Federal Reserve’s stated goal of not having core inflation exceeding 2 percent, consumer price growth remains modest overall.

Outside of food and energy, a number of categories saw prices increases, helping to lift core inflation. These include new and used motor vehicles and apparel. But, there were also some areas where prices fell for the month, including appliances, household furnishings and computers.

Overall, these numbers confirm what many Americans have perhaps already noticed. U.S. consumer pricing pressures have eased considerably in the past month. A similar finding was observed last Friday with the release of producer price data. Even with core inflation exceeding 2 percent, pricing pressures are not sufficient enough to warrant tighter monetary policy, at least not yet.   

Chad Moutray is chief economist, National Association of Manufacturers.

Today our free trade agreement with Colombia, passed by Congress last October, goes into effect. This agreement allows manufacturers to begin reaping the benefits of  the Colombian market. The implementation of this agreement presents a major opportunity for manufacturers in the U.S. to expand their exports to Colombia, whose products mostly enter the U.S. duty-free already. 

With a population of 46 million, Colombia represents a significant market for U.S. exports – the third largest in Latin America. Furthermore, Colombia’s GDP is $467 billion with expected growth of 4.7 percent this year.  Until now the average tariff on U.S. products entering the Colombian market has been 15 percent, adding substantial cost to the purchase of U.S. goods in Colombia and therefore putting American goods at a severe disadvantage.  With this FTA in force, U.S. competitiveness will be enhanced and our exports to Colombia will expand as a result of our new market access there.

Colombian duties on 80 percent of U.S. manufactured products will immediately be dropped to zero, with the remaining tariffs phased out over the next ten years.  This means expected growth for manufacturers in the U.S. in the following key sectors:  oil and gas machinery and services, plastics, construction and mining equipment, telecommunications equipment and services, information technology, safety and security, automotive parts and accessories, electrical power systems, building materials, food and beverage processing and packaging equipment, and medical and pollution control equipment.

We’re pleased that we now have a level playing field with Colombia but we can’t afford to just stop here. There are currently dozens of trade agreements being negotiated all over the world and we are party to only one. If we are going to meet the President’s goal of doubling exports then we need to do more. With 95 percent of the world’s consumers living outside of the U.S. we must continue to negotiate new free trade agreements to open new markets for manufacturers.

Jessica Lemos is director of international trade policy, National Association of Manufacturers.

On Friday, EPA announced that it had finished testing the drinking water in Dimock, Pennsylvania–a town that has become the epicenter of the hydraulic fracturing debate–and found no contaminants at levels of concern.

Will this settle things once and for all?  Of course not.  But it does seem to indicate that Pennsylvania’s fracking regulations are working.  That’s important because, partly based on fears that contamination may be occurring, the federal government jumped in and started regulating hydraulic fracturing.

One month ago, President Obama issued an Executive Order that not only recognized that “states are the primary regulators of onshore oil and gas activities,” but also that having ten different federal agencies all trying to regulate in addition to those states was a bad idea.

The Executive Order made sense.  What happened in the weeks afterwards didn’t.  Since the order was issued, the industry received three new federal regulations on fracking (two from EPA and one from the Department of Interior), which will undoubtedly interfere with state regulations.  The same state regulations that, according to EPA, made  61 out of 61 wells in Dimock safe.

Ross Eisenberg is vice president of energy and resources policy, National Association of Manufacturers.