The Brookings Institution has recently been cranking out fascinating reports on the state of U.S. manufacturing. They tell the counter-intuitive story of the rise of the sector in our country.
It’s a theme I’ve been following in a more concentrated way in a series “Made in the Bay Area, detailing the renaissance of manufacturing in Silicon Valley and — to some extent — the Bay Area in general. (You’ll find a couple of Brookings reports on manufacturing there, too.)
But today Brookings has come out with three policy briefs that look not at what is, in terms of manufacturing, but what could be, if the right steps are taken.
Taken together, the three papers (found here, here and here) call on the U.S. government to spend money to better prepare the workforce for the kind of advanced manufacturing jobs that call for specialized skills, and to encourage manufacturing innovation hubs to take root and build momentum for growth in manufacturing.
The country does appear to be facing a skills gap when it comes to the advanced manufacturing jobs that are being created. It’s a challenge that I’ll look at in the next installment of “Made in the Bay Area.”
I know what you’re thinking: Spend more money? Are you crazy?
Well, you’ve got to spend money to make money, as they say. And it turns out manufacturing jobs are particularly good jobs that produce products that can be exported, thereby reducing the nation’s trade deficit.
Manufacturing also begets innovation as those who make things work both on ways to make better things — and on better ways to make them.
In its “Race to the Shop” recommendation, Brookings explains its investment policy in part like this:
“U.S. manufacturing is an important source of quality
well-paying jobs that offer a significant wage premium—nearly 20 percent higher average weekly
earnings than non-manufacturing jobs—and are more likely to provide health care and retirement
benefits. The sector also accounts for the lion’s share of the country’s R&D and innovation activity.
While manufacturing provides only 9 percent of all U.S. jobs and 11 percent of total GDP, it employs 35
percent of all engineers, represents 68 percent of the spending on R&D that is performed by U.S.
companies, and produces 90 percent of all patents developed in the United States. Further,
manufactured goods comprise about 65 percent of all U.S. trade (both imports and exports), according
to Helper, Krueger, and Wial, making it a crucial component of any strategy to reduce America’s growing
trade deficit. In short, a strong manufacturing sector is necessary for America to compete in the global
So, why not create a “Race to the Shop,” as Brookings suggests, a $150 million a year competition to spur regions to align what they are teaching their residents with what they need to know to land advanced manufacturing jobs.
“Race to the Shop responds to one of the major barriers threatening the resurgence of U.S. manufacturing: the lack of educated workers with the skills necessary for today’s advanced industry,” said Bruce Katz, Brookings vice president, co-director of the Metropolitan Policy Program, and co-author of the policy brief. “Like the successful Race to the Top program for K-12 education, Race to the Shop uses the carrot of federal spending to reinvent how state and metro areas help manufacturing companies realize their full potential.”
Add to that an initiative that would target 20 universities to be “manufacturing universities,” which would each receive $25 million in National Science Foundation money to work with advance manufacturers to come up with programs that are relevant to the needs of the real world.
And finally, Brookings says, the nation needs to invest in at least 25 regional research centers to do the kind of blue sky thinking that will lead to improved advance manufacturing techniques and increase the United States’ market share when it comes to manufacturing.
“If the United States wants to remain competitive in the advanced manufacturing economy of tomorrow, it must move academic engineering departments away from the ‘research for the sake of research’ mentality and instead create real opportunities for work that is relevant to industry,” said Dr. Robert Atkinson, president of the Information Technology & Innovation Foundation, nonresident senior fellow at the Brookings Metropolitan Policy Program, and co-author of the brief. “Designated Manufacturing Universities offer an important tool for cultivating the innovation-driven, production-oriented engineering culture and skilled workforce needed for global competitiveness.”
And should that come to pass, I can’t help but think that Silicon Valley is a lock to be one of the hubs.
Photo by Gary Reyes, San Jose Mercury News