Is the Revival of US Manufacturing for Real?

Talk of an economic recovery has included much discussion of a manufacturing revival. Such discussions often point to particular states, such as Washington, where 31,000 new manufacturing jobs were created from 2009-2013. While such statistics are encouraging, they do not reflect the difficulties encountered by companies that want to hire.

Michigan, ground zero for America's manufacturing bust, is now leading the way in America's manufacturing revival. Between 2009-2013, the state gained over 88,000 manufacturing jobs. That has not only presented opportunities for individuals who are looking for work, but it is also helping in the recovery of a state that suffered mightily over the last couple of decades. Detroit, the state's largest city, will be heavily reliant on the success of the manufacturing industry as it seeks to pull itself out of its recently declared bankruptcy.

Other states in the Midwest are also benefiting from the manufacturing revival. Illinois, Indiana, Ohio and Wisconsin have all seen resurgences in the sector, in part because their state governments have been working feverishly to improve the business climates. Reductions in regulations and taxes have made it easier for companies looking to hire.

While talk of a manufacturing revival has been widespread, the jubilation over and success of such a recovery is hampered by a skills gap that cannot be overlooked. For example, John Patrick, president of Clay & Bailey Manufacturing, said that his company is looking for skilled workers but can't find them. Some of the applicants that his company evaluates can't even read rulers, which all but leaves such people out of any manufacturing revival.

Patrick also pointed to the problem of those who had manufacturing jobs retiring and being replaced by those who avoid the industry because of outdated notions of it. When most people think of manufacturing, they think of dirty, often dangerous factories that churn out automobiles. Today's manufacturing requires "blue tech" workers who create things such as medical devices. Conditions in these types of factories are radically different from those that existed a century ago.

Training costs are also a challenge. Patrick noted that many companies spend up to $10,000 per year per employee on training, a prohibitive cost for many smaller manufacturers and a prohibitive time frame for others. According to Patrick, the problem is not a shortage of "good workers", i.e., people who are ready, willing and able to learn, but that taking them from "below-zero" math ability to skilled workers presents considerable challenges.

There is a real manufacturing revival going on in the United States, but Americans are not fully prepared to capitalize on it. Unless people enter the workforce with better basic skills, the skills gap will ultimately doom it to failure. At best, many people will be locked out of the benefits of the boom. At worst, factories will once again begin moving overseas to countries in which it is cheaper to train workers.

Photo courtesy of Giuseppe Lambertino at Flickr.com