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US Manufacturing Opens 2017 with a Production Boom

US Manufacturing Opens 2017 with a Production Boom

Jan 4, 2017

By Michelle Jamrisko, IndustryWeek American manufacturing expanded in December at the fastest pace in two years, reflecting firmer output and the biggest pickup in orders growth since August 2009. The Institute for Supply Management announced today that its index increased to 54.7, the fourth straight advance, from 53.2 a month earlier. The median forecast in a Bloomberg survey called for 53.8. Readings above 50 indicate growth. The ISM’s measure of orders surged 7.2 points, while its gauge of prices paid for materials climbed to the highest level since June 2011. The jump in bookings, including the strongest pace of export orders since May 2014, will help keep factories on solid footing early this year as business confidence improves. Plant managers responded to the brighter outlook by adding to staff at the fastest pace since the middle of 2015, according to the ISM’s report. Additional hiring and the pickup in inflation at the producer level help explain the Federal Reserve’s decision last month to raise interest rates. The ISM’s index of prices paid climbed to 65.5 from a November reading of 54.5. The group’s gauge of new orders increased to 60.2 last month after 53 in November. The measure of orders for overseas customers rose to 56 in December from 52. A rebound in export markets has helped give an added boost to U.S. factories following deceleration over the past couple years. Domestic companies have also made progress getting inventories more in line with demand and there are early signs corporate investment is beginning to firm. To be sure, a rally in the dollar since the presidential election risks restraining overseas sales of U.S.-made goods. The ISM’s gauge of production increased to 60.3, the highest since November 2014, from 56 a month earlier. A measure of factory employment picked up to 53.1 in December from 52.3 the prior month. The national payrolls report due Friday from the Labor Department is projected to show about 175,000 jobs were added in December, in line with the monthly average in 2016, according to the median estimate in a Bloomberg survey. The ISM report also showed gauges of factory inventories shrank at a faster pace in December from a...

Ford to scrap Mexico plant, invest in Michigan; CEO cites…

Ford to scrap Mexico plant, invest in Michigan; CEO cites…

Jan 3, 2017

“Ford to scrap Mexico plant, invest in Michigan; CEO cites Trump policies” By FoxNews.com Before he’s even taken office, President-elect Donald Trump has proven to be quite the job creator. Ford Motor Company announced Tuesday it will cancel a $1.6 billion plant planned for Mexico and will instead invest $700 million in a Michigan assembly plant, directly tying the decision to “pro-growth policies” championed by President-elect Donald Trump. Trump had previously been critical of Ford’s plans to build in Mexico. After the announcement, Trump tweeted a link to a story about the Ford decision and then added in a subsequent message: “Instead of driving jobs and wealth away, AMERICA will become the world’s great magnet for INNOVATION & JOB CREATION.” Fields said Ford would have gone ahead with the decision whether or not Trump was elected president, however, he did say that he alerted both Trump and Vice President-elect Mike Pence ahead of the announcement on Tuesday. The Ford news was the latest in a string of pre-inauguration successes for Trump in the manufacturing sector. In early December, air conditioner and furnace maker Carrier agreed to stay in Indiana after weeks of negotiations headed by Pence. The decision reportedly saved about 700 jobs that would have been shifted to Mexico. Later in the month, wireless provider Sprint and Internet company OneWeb announced they would be adding thousands of jobs in the U.S. Both companies are controlled by SoftBank founder Masayoshi Son, who had previously met with Trump. Earlier Tuesday morning, Trump took aim at another auto giant: General Motors. “General Motors is sending Mexican made model of Chevy Cruze to U.S. car dealers-tax free across border. Make in U.S.A. or pay big border tax!” Trump tweeted. GM, however, quickly pushed back on Trump’s assertions. “GM builds the Chevrolet Cruze hatchback for global markets in Mexico, with a small number sold in the U.S.” a statement said. The investment in the Flat Rock Assembly Plant is set to create 700 jobs, according to Fields. The money, which was taken from the $1.6 billion earmarked for the Mexico plant, will be used to open a new factory that will build high-tech autonomous and electric vehicles as...

Reshoring and Skilled Workforce Go Hand in Hand

Reshoring and Skilled Workforce Go Hand in Hand

Dec 23, 2016

By Harry Moser, Area Development A higher skilled workforce is necessary for reshoring to occur, but recruiting that workforce also requires reshoring to be visibly successful. The United States is facing a crucial workforce skills gap. According to a recent study, companies that are interested in expanding to new locations view the talent shortage as more critical in the U.S. than in other countries. “Skills and talent issues have always been, and continue to be, an issue for site selection, but the gap is viewed as more critical in the U.S. than in Europe or Asia,” notes Phil Schneider, a site selection consultant with nearly 30 years of experience. The quality and quantity of the available skilled workforce is critical to attract corporate expansion projects for U.S. economic development. For more rapid reshoring to take place, the U.S. needs a higher skilled and larger workforce. Recruiting that workforce also requires that reshoring be visibly successful. Ultimately, reshoring and skilled workforce go hand in hand — you simply can’t have one without the other.  The U.S. Workforce Skills Gap The U.S. will need to fill approximately 3.5 million manufacturing jobs over the next 10 years. However, it is estimated that there will be a talent shortage of two million skilled workers, according to a recent study from Deloitte and The Manufacturing Institute. According to the research, 84 percent of manufacturing executives agreed that there is a talent shortage in U.S. manufacturing; 82 percent feel the shortage impacts their ability to meet demand, while 78 percent say it impacts the implementation of new technologies that increase productivity and competitiveness. A study done by Accenture PLC and The Manufacturing Institute similarly found that 75 percent of manufacturers were having trouble finding skilled production workers. According to Reshoring Initiative data, skilled workforce availability and training ranked number two in the reasons given by companies for reshoring and foreign direct investment (FDI). Also, when companies reshored and failed to find the needed workforce, the transition was painful. “Due to advances in production machinery technology, both our domestic and foreign-based manufacturing clients frequently stress the availability of skilled and trainable workers as a top priority in site selection decisions,” says Michelle Comerford, Industrial and...

Why so many U.S. manufacturers are putting up…

Why so many U.S. manufacturers are putting up…

Dec 21, 2016

“Why so many U.S. manufacturers are putting up ‘Help Wanted’ signs” By Danielle Paquette, The Washington Post Susan Murray Carlock says her Indiana company is providing something popular opinion has deemed nearly extinct: well-paying manufacturing jobs. Over the past four years, Mursix Corp., a creator of seat belt buckles and bed frames, has sought to fill a variety of production positions. The average wages exceed $20 an hour — a ladder to the middle class. Trouble is, she can’t find workers. “We’ve been on a growth trajectory that is crazy,” said Carlock, whose family bought the firm for roughly $5 million in 1990 and has watched it grow into a $42 million business. “But we face serious labor force issues.” The company needs skilled laborers, men and women who can absorb the “tribal knowledge” of the toolmakers before they retire, she said. This year, in an effort to draw talent, the firm set up an apprenticeship, paying promising employees as they learn the trade. Carlock’s predicament isn’t isolated, even in the Rust Belt, where steadily vanishing manufacturing jobs became central to this year’s presidential election. She knows of at least two other plants in Muncie, Ind., a college town in the state’s northeast quadrant, that face a similar hiring challenge. “We’re all competing with each other for people,” she said. “To say manufacturing is dying in the United States just isn’t true.” But American manufacturing is changing, and the enterprises flourishing today often demand a different set of skills than assembly lines of the past. One reason for the labor shortage is the fear of change, said Michael Hicks, a business professor at Ball State University in Muncie, Carlock’s city. Many of the open roles involve computer assistance, which requires job training. Although some companies and state programs will cover the tuition bills, some workers, particularly those who’ve held the same job for decades, are hesitant to take them up on the offer, even if unemployment is imminent and the wages are competitive. The average hourly wage for these roles is approximately $20, according to federal data. “I’ve gone to war,” said Hicks, an army veteran turned academic, “and going back to school was scarier.” Young people aren’t helping fill the slots...

Rural, and making it: Bringing manufacturing to small towns

Rural, and making it: Bringing manufacturing to small towns

Dec 20, 2016

By Ben Rowley, Rural Business HQ He charged companies whatever he wanted as a freelance industrial designer, but he left it all to become part of a rural manufacturing renaissance. It started five years ago, when after 15 years of designing, Jonathan Baker said goodbye to his comfortable career in New England and moved to the Pacific Northwest to design and manufacture his own product in a town of under 1,000 people. On top of fighting long odds that come with starting a business, in a tiny town no less, Baker started his company in an industry that has been on the decline in the U.S. for decades. He and his business partner set out to create a product and manufacture it domestically, with no outsourcing to other countries. Period. Nevermind that this goes against decades of conditioning saying it is more expensive to manufacture in America. Nevermind Baker didn’t yet know what he was going to make. For him, this was about more than a product. “I knew I had to make it here,” he said. “To export all that opportunity to an overseas factory would be missing out on one of the biggest benefits of a successful design – jobs. The government doesn’t encourage this, and the tax code doesn’t either, but it is the right thing to do if you believe in the pride of making things where you live and the profound effect that can have.” Soon Baker discovered the town of Twisp, Washington, a place transformed over the years by a declining timber industry and an influx of retirees and seasonal recreationalists. There he found a vacant 1920s barn and saw in it the potential for both design and manufacturing to live under one old roof. Baker loved what Twisp offered – character, originality, a unique economy and proud, self-reliant people. “When we came into Twisp we saw that history and we felt this sense of place that hasn’t really been influenced by the rest of the world,” he said. “We thought it was a great environment to remove yourself from the influences of the mainstream.” With “the heritage and beauty of building things in your community” guiding their...

Why Smart Manufacturing Can Be a Dumb Idea

Why Smart Manufacturing Can Be a Dumb Idea

Dec 19, 2016

By Steven Blue, President & CEO of Miller Ingenuity Featured on IEN Don’t bother with smart manufacturing if you have a dumb workforce. And if your workforce is dumb, it’s your fault, not theirs. Someone asked me recently my thoughts on Smart Manufacturing. The so-called IT revolution in the factory. They couldn’t believe that I didn’t see Smart Manufacturing as the salvation of American manufacturing. Don’t misunderstand me. Smart Manufacturing has a place in reviving American manufacturing. I have a smart factory. We employ the latest in pick to light systems, automated CNC machines and seamless integration from order inquiry to accounts receivable. But that isn’t where I started my revolution. And you shouldn’t either. The problem with many CEO’s today is they have turned away from the astonishing potential of the workforce and turned toward automation instead. Big mistake. But I hear it all the time. What is the sense in spending millions on automating your factory if our workforce could care less? What is the sense in buying expensive machine tools if your workforce can’t wait to get to the bowling alley, yet drag themselves to work? I’ll tell you why. Because too many CEO’s view their employees as expendable assets. They should view them as renewable resources. And renew them. Don’t bother with smart manufacturing if you have a dumb workforce. And if your workforce is dumb, it’s your fault, not theirs. Don’t bother with an IT revolution. Your revolution has to start with a “Smart Workforce”. You have to make a new compact with your employees. You need to ignite the human spirit in your workforce. Imagine this. What would happen if every day your employees came to work excited to do better today than they did yesterday? Imagine how your company would soar if your employees were absolutely dedicated to supporting the mission and each other in attaining it? Imagine what it would be like if your employees were like Cirque de Soleil performers? This is the place where I get blank stares from many CEO’s. They don’t like the “soft stuff.” “Give me the hard stuff,” they say. “Tell me how to build a smart factory, not a...