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One World, One Industry: 100 Days In—President Trump and a Better Manufacturing Policy

On the campaign trail and since coming to office, Donald Trump promised to bring manufacturing jobs back to the United States.

Since coming to office, he has followed through on this pledge by announcing his Manufacturing Jobs Initiative[1], which will draw on input from a council of more than two dozen U.S. executives and CEOs. He has also directed agencies to support the expansion of manufacturing through reducing regulations.

While these were welcome early measures, there is a world of difference between simply announcing an advisory council and reviewing regulations, vs. pursuing more meaningful measures that will truly advance the industry.

This month’s column will focus on three concrete policy initiatives the Trump Administration should consider to truly help strengthen manufacturing in the United States. The lessons—in broad strokes—are just as applicable to governments worldwide as well.

One hundred days into his presidency, President Trump must begin to face the reality that the vast majority of the 5 million U.S. manufacturing jobs lost since 2000 can be attributed not to offshoring, but to automation.

In fact, a 2015 study by researchers at Ball State University, “The Myth and Reality of Manufacturing in America”[2] found, “Almost 88% of job losses in manufacturing in recent years can be attributed to productivity growth…” chiefly “…automation and information technology advances.” U.S. manufacturing output today is as at an all-time high, but the industry has far fewer workers because productivity has doubled since 1994.

This increase in productivity and automation is not limited to the United States, but is part of a seismic shift affecting our electronics industry worldwide. Today’s manufacturing relies on high-skilled labor, digital tools, and customized automation that increases outputs and reduces costs. Thus, the first step to advancing U.S. manufacturing is to create a policy framework that fosters today’s manufacturing industry.

Specifically, the Trump administration should focus on three areas:

• Apprenticeships—Increased apprenticeship programs for manufacturing workers.
• Early STEM Education—Promote STEM education in primary and secondary schools.
• Federal Research Funding—Increase federal support for research, development and commercialization of advanced technology through public-private partnerships.

Apprenticeships

Recent surveys have shown that more than 80% of manufacturing executives believe there is a talent shortage in the United States. Similar statements are heard around the globe. Openings for U.S. manufacturing jobs last year averaged 353,000 per month, up from 311,000 in 2015 and 122,000 in 2009.

A viable solution to this talent shortage is to establish a robust program of apprenticeships, funded and led by public-private partnerships. This model works well in Germany, where companies including Siemens and Bosch use apprenticeships to train their workers in advanced engineering and manufacturing.

Such apprenticeship programs exist in the United States, but on a much smaller scale.  ApprenticeshipUSA[3] is a public-private partnership aiming to ramp up this neglected sector of education. Surely the executive producer of “The Apprentice” should support business-led apprenticeship programs.

The U.S. Department of Labor reports that 87% of apprentices in the United States receive employment offers following their training programs[4]. Further, workers who complete apprenticeships earn $50,000 per year on average[5], or higher than the median U.S. annual wage of $44,720.

Early STEM Education

But support for widespread vocational apprenticeship programs will require more than just political support and funding. A wider understanding of advanced manufacturing today and the advanced skills required to work in those industries would help de-stigmatize U.S. vocational education, which many view as a last resort for those students not adequately equipped for traditional college.

This could start with a broader focus in building foundational STEM skills in early childhood education. Without a robust pipeline of students prepared to pursue advanced STEM education in vocational schools or universities, there won’t be talent available for the jobs we’re trying to create.

As Ball State professors Dr. Michael Hicks and Srikant Devaraj conclude in their study, “The Myth and Reality of Manufacturing in America”:

The nation and individual states should actively support education reforms at the secondary and tertiary level that prepare students for employment opportunities in manufacturing, which will be large due to job turnover among the baby boom share of the manufacturing labor force. …Human capital interventions should also begin at the pre-K level, focusing on skills that enable acquisition of the mathematical and cognitive skills required of the modern manufacturing workforce[2].

Federal Funding

If President Trump truly wants to return manufacturing jobs to the United States, his first focus should be on investment in research and development of new technologies that will keep America at the forefront of advanced manufacturing.

The Obama administration and Congress made a valuable contribution by establishing Manufacturing USA[6], formally known as the National Network for Manufacturing Innovation. Established with bipartisan congressional support in 2014, and led by the National Institute of Standards and Technology, Manufacturing USA brings together industry, academia and government in a network of public-private partnerships designed to accelerate manufacturing innovation.

For example, my organization—IPC, representing the electronics industry—is active in NextFlex[7], a consortium of companies, laboratories, and government agencies that work together to foster the growth of the flexible electronics supply chain. Unlike traditional rigid circuit boards, flexible circuits embedded in fabric or film will pave the way to innovations such as medical implants that conform to bones and organs; lighter communications gear built into military uniforms; and solar cells on a roll of plastic.

Other Manufacturing USA institutes are focusing on hot areas such as 3D printing, lightweight materials, and advanced semiconductors. Taken together, these organizations will unleash wave after wave of innovation and growth in the manufacturing sector.

Thus, the Trump administration would do well to continue advocating for public-private partnerships, and urge Congress to spare Manufacturing USA from budget cuts.

Conclusion

To truly increase the number of American manufacturing jobs, President Trump should support increased investment in research and development for advanced manufacturing, promote and fund STEM education in primary and secondary schools, and build stronger apprenticeship programs. It is this type of investment—in human capital and technology—that will truly help make American manufacturing great again.

Special Note

It is time for the PCB manufacturing industry to present a united front and make our voices heard. On May 1−3 top executives from leading electronics companies plan to do just that as they gather in the nation’s capital for IMPACT Washington, D.C. 2017. Join us as we advocate for a better public policy framework for our industry. For more information on this event, please visit our website. PCB

John Mitchell is president and CEO of IPC—Association Connecting Electronics Industries. To read past columns or to contact Mitchell, click here. 

This column originally appeared in the April 2017 issue of The PCB Magazine, click here.