The Return of US Manufacturing

Friday, February 03, 2014

Ask the average citizen on the street about where most manufacturing takes place and you are liable to be told, “not in the US”.  But is that really true?  In the last year, the Washington Post, Bloomberg-Businessweek, Forbes, CNBC, NBC News, CNET, Time, Tampa Bay Times, and others have all reported on the return of manufacturing to the US.  Both domestic and foreign manufacturers are building facilities in the US and employing US workers in them.  This reversal of “off-shoring” or “re-shoring” is occurring as the cost to manufacture in foreign countries is rising while the cost of manufacturing in the US is declining, relative to each other.  In addition to labor cost, transportation and inventory costs are lower for US based manufacturing compared to goods shipped from Europe and China.  However, re-shoring may not bring with it the numbers or types of jobs lost when manufacturing was off-shored years ago.  Increased automation is demanding fewer but higher skilled workers.

One barrier to re-shoring lost manufacturing is the reported lack of skilled workers available to design, build, run, and maintain the highly automated manufacturing equipment used in many of the high tech processes employed in today’s factories.  A. Gary Shilling writing for the Bloomberg View points out that 4% of degrees in the US are in engineering, versus 17% in Asia and 34% in China.  Shilling believes that increased use of robotics and technologies such as 3-D printing and cold spraying will add to the competitive position of US manufacturing by 2020.  But these and other advances in manufacturing technologies require highly trained and talented individuals in engineering, science, math, computer and the biological sciences.

We have heard it before; the US is not producing enough graduates in the Science, Technology, Engineering, and Math fields or the so-called STEM degrees.  Yes, employers are seeking workers with STEM degrees and backgrounds; however, the most talented engineer is of little value if they lack the communication skills to convey their thoughts lucidly via the written or spoken word.  Employers want and need well-rounded workers who know and understand technology and how that technology can be effectively applied to their business to make that business more competitive and produce products and services consumers wants to buy.

While many public and private primary, secondary, and post-secondary schools are developing programs to teach STEM and to train teachers to teach STEM courses, many businesses can not afford to wait for students to move through the educational system.  Many employers, including the US military, are offering apprentice programs in an effort to build a pipeline of current and future STEM candidates.

As with any other talent pool, STEM candidates must be sourced, recruited, and managed.  There has to be a “goodness of fit” match between the organization and the worker to ensure the goals of both are in alignment.  Many of the same motivational factors apply to STEM and non- STEM talent.  Are there opportunities to advance within the organization?  Are there opportunities to learn new technologies?  Are there opportunities for peer recognition within and outside of the organization?