Our Manufacturing Moment and the Continuing Manufacturing Renaissance

On July 25^th we attended the Brookings Institution event “Manufacturing U.S. Prosperity:  A Policy Discussion.”  This event included a keynote speech on the innovation and economic competitiveness of U.S. Manufacturing by Gene Sperling, Director of the President’s National Economic Council.  The event concluded with a responsive panel discussion with thought leaders from The Brookings Institution, MIT, McKinsey Global Institute, and NorTech.

1)     Manufacturing policy is really about innovation spillovers, not about industrial policy and the picking of winners and losers.  Proactive manufacturing policy can help better co-locate production and design, sustain the industrial commons that is so important to place-based regional economic growth, and ensure the development of healthy and dynamic supply chain ecosystems.

2)     Using the traditional approach to measuring manufacturing jobs at the ”factory floor” level does not account for the increasing importance of supply chain jobs.  He cited recent data that indicated approximately 5.7 million additional jobs that would have either: (a) been previously counted as manufacturing in past definitions and no longer are; or (b) were part of supply chains that were intertwined between manufacturing and services.

3)     Identifying the exact point at which we are in or beginning to be in or otherwise ending a manufacturing renaissance cannot be measured by static, point-in-time data.  He cited numerous media reports and recent studies that did not agree on the exact state of a manufacturing renaissance and urged that we not use snapshots as determinants of public policy, but rather look at the overall historical and projected future trends.  He then cited a number of data points for reflection, including the 325,000 manufacturing jobs added since the auto recovery, whereas it had been predicted that upwards of a million jobs were expected to be lost if the auto recovery was not publicly supported.

Master of Ceremonies Amy Liu, senior fellow and co-director of the Brookings Metropolitan Policy Program, further supported the often complex and competing points of view on the overall state of manufacturing in her opening remarks, citing that even within the Brookings Institution itself, thought leaders in the area of manufacturing were not in full agreement on the state of manufacturing.

Even so, there was much agreement between Gene Sperling and the panel itself on several topics, including the importance of the MEP program.  In fact, there was a question from the audience on how the MEP program’s funding could be further increased - and done so quickly -  citing the recent doubling of funding by the Canadian Government for a similar program in that country. 

Other points of agreement centered on:

-        R&D policy and tax credits

-        Overall tax code

-        Modernization of infrastructure (particularly logistics)

-        Talent, skills, education, and training

The meeting was attended by over 100 people, including many familiar faces in the manufacturing policy and program arena.  We left encouraged by the energy and enthusiasm, and that MEP was cited numerous times as important to the Administration’s strategy and to numerous stakeholders of the nation’s manufacturing policies.  We were also encouraged by the discussions around the role of the small and medium business and their inter-relationships within supply chains, an issue that is very important to the MEP program.

We hope that there are more events and discussions like this on the horizon as we seek to capitalize on the manufacturing moment and continuing renaissance.  Not just a point in time like today’s discussion, but many discussions with many policy leaders and manufacturers over a sustained period of time.