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Blog Category: Manufacturing

Acting Secretary Blank Talks Administration Support for American Manufacturing

Guest blog post by Dr. Rebecca Blank, Acting Secretary of the U.S. Department of Commerce.

I just returned from the White House Business Council American Economic Competitiveness Forum on Manufacturing where I had an opportunity to hear from a group of American manufacturers—representing businesses of all sizes from across the country—about how the Obama administration can continue to support them as they build things here and sell them everywhere. As we have seen in recent months, manufacturing is one of the bright spots for our economy. Over the past two and one-half years, more than a half-million manufacturing jobs have been created in the U.S.—the strongest job growth in that sector since the 1990s. In fact, just last month, an additional 25,000 new manufacturing jobs were added.

In terms of production, manufacturing output is up 20 percent since 2009, and increased again in July. One manufacturing sector that has been consistently strong is the motor vehicles and parts industry, which has added 165,000 jobs since June 2009a sector that might not even exist in the U.S. today if not for the assistance this administration gave to the U.S. auto industry in 2009.

This matters because we know that manufacturing jobs are good jobs that pay more than average and provide greater benefits. They strengthen economic security for middle class families.

There is a powerful link between America’s ability to make things and America’s ability to innovate, compete, and create good jobs. We have come to realize that you can’t separate innovation and production—they have to sit near each other. Manufacturers perform 70 percent of all private sector R&D, investing in and producing technological advances that accounted for 90 percent of U.S. patents.  Economic research indicates that innovation—in new products or new processes—was central to three-quarters of the nation’s economic growth since World War II and it is not an accident that the manufacturing sectors where America is most competitive are all advanced manufacturing, where new technologies, new products or new production processes are central to the success of specific firms.

U.S. Manufacturing Continues to Create Jobs in the U.S.

Guest blog post by Mark Doms, Department of Commerce Chief Economist, Economics & Statistics Administration

Earlier today, the Bureau of Labor Statistics (BLS) released a report showing that the private sector added 172,000 jobs last month, and overall employment rose by 163,000. While there’s more work to be done, the economy is creating jobs on a consistent basis. The economy has added private sector jobs for 29 straight months, for a total of 4.5 million jobs. In fact, since the beginning of the year, the economy has added over 1.1 million private sector jobs. Today’s employment report provides further evidence that the U.S. economy is continuing to recover from the deepest recession since the Great Depression.

Additionally, the BLS report also showed that the manufacturing sector continues to be a bright spot, which is especially important for middle class families, because these jobs pay high wages and provide high levels of benefits.

The good news is that the U.S. manufacturing sector’s recovery continues: 532,000 new manufacturing jobs have been created over the past 30 months, with 25,000 being added in July. In terms of production, manufacturing output is up 19.8 percent from the trough reached in June 2009.

A part of manufacturing that has been consistently strong is the motor vehicles and parts industry, which has added 165,000 jobs since June 2009. Further, production of cars and trucks in the U.S. reached 10.5 million units at an annual rate in June, a sharp contrast to the shockingly low level of 3.7 million units witnessed in January, 2009.  To continue the revival in manufacturing jobs and output, it is crucial that we implement President Obama’s proposals providing tax incentives for manufacturers, supporting training for the workforce, creating manufacturing hubs, and ending tax breaks for companies that send jobs overseas and provide tax incentives for companies bringing jobs back to the United States.

EDA Helps Ohio Auto Community Build a New Future

Economic Development Administration-banner

Guest blog post by Matt Erskine, Acting Assistant Secretary of Commerce for Economic Development

Economic recovery in the wake of an economic disaster—such as the closing of a large employer—doesn’t happen overnight. It requires careful planning, the coordination of human and financial resources, and a willingness to consider alternative directions that will benefit the community in the long run.

This is the story that the city of Moraine, Ohio, can tell. For nearly 90 years, Moraine—located in close proximity to Dayton, Ohio—was the location of a single, prominent manufacturing plant whose successive owners read like an honor roll of 20th century American business: Dayton-Wright Airplane (manufacturer of DeHavilland aircraft), Frigidaire (maker of an iconic line of refrigerators), and, since 1981, General Motors (GM).

When GM announced plans in June 2008 to close this plant, the development came as a blow to the local economy. Just think about the impact to suppliers and the distributors that get their business from them.  According to a report published by the International Economic Development Council, the Moraine region, with more than 90 GM suppliers in 14 surrounding communities, lost more than 800 jobs at larger suppliers in addition to the 4,200 jobs that were lost when GM shut down.

Within weeks of GM’s announcement, staff from the Chicago regional office of the U.S. Department of Commerce’s Economic Development Administration (EDA) began working with state and local officials in Ohio to develop a strategy to deal with the effects of the Moraine plant closure. As a first step, an EDA investment helped the city develop a bottom-up Comprehensive Economic Development Strategy (CEDS) to guide the region’s recovery efforts.

EDA: By Attracting Investment in America, We Create New Jobs

Today, Acting Assistant Secretary for Economic Development Matt Erskine joined Illinois Governor Pat Quinn, Rochelle Mayor Chet Olsen, and Members of Congress at a ribbon-cutting ceremony for this new Nippon Sharyo railcar production facility in Rochelle, Illinois

Guest blog post by Matt Erskine. Acting Assistant Secretary of Commerce for Economic Development

Attracting foreign direct investment (FDI) to the United States, and the jobs that come with it, has been a priority of the Obama administration since it came into office. Business programs from every federal agency have been thoroughly ramped up, and a new initiative targeting foreign companies thinking about locating in the United States, SelectUSA, was launched in 2011.

The United States is already the largest recipient of FDI in the world. In 2010, such investment totaled $228 billion, up from $153 billion in 2009, supporting more than five million jobs throughout the country. Those workers made up 4.7 percent of total private-sector employment in the United State, with an annual payroll of $410 billion.

Success in attracting FDI doesn’t happen without a lot of hard, collaborative work on the part of states, municipalities, development agencies, and the federal government. I saw an excellent example of this today in the city of Rochelle, Illinois, where I participated in a ribbon-cutting ceremony to mark the opening of a new manufacturing facility for Nippon Sharyo U.S.A., the U.S. subsidiary of a Japanese manufacturer of railcars.

NIST: University, Industry Experts Recommend Steps to 'Invigorate' U.S. Manufacturing

Alternate TextReport: University, Industry Experts Recommend Steps to Invigorate U.S. Manufacturing (cover of report)

A new report by a national committee of U.S. industry and university leaders details 16 recommendations "aimed at reinventing manufacturing in a way that ensures U.S. competitiveness, feeds into the nation's innovation economy, and invigorates the domestic manufacturing base."

The report was prepared by the 18-member steering committee of the Advanced Manufacturing Partnership (AMP) that was launched by President Obama in June 2011 and co-chaired by Susan Hockfield, now president emerita of the Massachusetts Institute of Technology, and Andrew Liveris, president, chairman and chief executive officer of The Dow Chemical Company.

The AMP Steering Committee Report to the President on Capturing Competitive Advantage in Advanced Manufacturing (PDF) was formally adopted today by the President's Council of Advisors on Science and Technology.

It addresses needs in three broad categories:

  • enabling innovation,
  • securing the talent pipeline, and
  • improving the business climate.

The recommendations include a call to establish a national network of manufacturing innovation institutes; an emphasis on investment in community college training of the advanced manufacturing workforce; an approach to evaluate platform manufacturing technologies for collaborative investment; a plan to reinvigorate the image of manufacturing in America; and proposals for trade, tax, regulatory, and energy policies that would level the global playing field for domestic manufacturers.  Full NIST release

EDA: Economic Recovery in Fremont, California's Auto Community

Ed. note: Cross-posted from U.S. Department of Labor's "Auto Communities" blog by Matt Erskine, Acting Assistant Secretary of Commerce for Economic Development (EDA)

We all know the situation a few years ago when President Obama took office: the American auto industry was shedding jobs by the hundreds of thousands and General Motors and Chrysler were in financial crisis. In the year before GM and Chrysler filed for bankruptcy, the auto industry lost more than 400,000 jobs. Had President Obama failed to act, conservative estimates suggest that it would have cost at least an additional million jobs and devastated vast parts of our nation's industrial heartland. But that did not happen because the president quickly intervened to save the U.S. auto industry from collapse. Today, GM, Ford and Chrysler have all returned to profitability.

President Obama's decision to respond so boldly was about more than the auto companies. It was about standing behind the countless workers, communities and businesses—large and small—that depend on the automotive industry. It was also about revitalizing American manufacturing.

Across the administration, federal agencies have outlined an agenda to support growth, job creation, and competitiveness in U.S. manufacturing. The U.S. Commerce Department's Economic Development Administration (EDA) has a strong track record of working with automotive communities to develop plans for economic recovery. The agency's efforts to help revitalize the nation's auto industry have been significant in Fremont, California, where a large auto assembly facility operated by the New United Motor Manufacturing, Inc. (NUMMI) was shut down in early 2010. The plant had employed nearly 5,000 workers, with thousands more dependent on it. The blow to the local economy was severe.

NIST: Creating Jobs with Innovation

Image: NIST Under Secretary and Director Patrick Gallagher tours Omega Plastics

Guest blog post by Patrick Gallagher, Under Secretary  of Commerce for Standards and Technology and Director, National Institute of Standards and Technology

We’ve been hearing a lot about manufacturing, especially advanced manufacturing, these days. Things like U.S. manufacturing :

  • Is critical to innovation since it’s responsible for most of our private sector research and development;
  • Is increasingly about sophisticated computer-driven, highly productive worksites requiring skilled workers; and
  • Is a growing source of good jobs.

What we don’t hear about as often are specific cases where U.S. manufacturers are using new technologies to diversify their markets, improve their products, and create or retain jobs. I was fortunate today to visit one such company, Omega Plastics Inc., located in Clinton Township, MI, about an hour outside Detroit.

The event was part of a “Best Practice Tour” sponsored by the Michigan Manufacturing Technology Center (MMTC), an affiliate of NIST’s Manufacturing Extension Partnership (MEP).

R&D, Patents are Key Manufacturing Drivers Chief Economist Mark Doms Tells National Association for Business Economics 2012 Conference

SME Companies Share of Total US Goods Exports 2000-2010

This afternoon Chief Economist Mark Doms addressed the 2012 National Association for Business Economics (NABE) Industry Conference, themed “Making it in America: Manufacturing Matters” in Cleveland, OH.  Hosted by the Federal Reserve Bank of Cleveland, this NABE industry conference focused on “the changing dynamics and rebalancing of U.S. manufactures in the global economy, focusing on its rejuvenation and new challenges and opportunities.” He previewed an upcoming ESA report showing that many communities depend critically on manufacturing, and these communities are spread all across the United States. That is because manufacturing provides the basis for many middle class jobs with good benefits.

  • Much of our country’s innovation comes from the manufacturing sector: close to 70 percent of our research and development and 90 percent of our patents.
  • Since the trough of manufacturing employment, firms have added about a half million new jobs. 
  • The manufacturing industry has been one of the leading contributors to GDP growth over the last two years, accounting for 38 percent of total economic growthIn 2011, the U.S. exported over $1.26 trillion worth of manufactured goods, more than double the amount in 2002.  Also, since the trough in 2009, manufactured goods exports are up 38 percent.
  • In particular, small and medium sized companies are increasingly contributing to our export growth, and they now make up over a third of total exports. 

That is why the Administration’s focus on manufacturing is so important. Doms highlighted what the Commerce Department is doing to help.

Europe Travel Log: Secretary Bryson’s Meetings and Events in Berlin, Germany

Photo of Bryson and others on elevated walkways

On May 24-25, U.S. Commerce Secretary John Bryson visited Berlin, Germany–the final stop on his European trip this week–to meet with senior business and government leaders and to address a major conference on trans-Atlantic trade. The Secretary delivered remarks on the importance of trans-Atlantic trade and a strong bilateral investment relationship between the United States and Germany. He also highlighted Germany's vocational training system, which he witnessed first-hand earlier in the week, as an important model for the United States.

‪While in Berlin, Secretary Bryson also met with Minister for Economics and Technology Philipp Roesler, State Secretary Harald Braun of the Foreign Ministry, and Chancellor Merkel's Senior Economic Adviser Lars-Hendrik Roeller. These meetings focused on how the U.S. and Germany can work together to advance economic growth and increase jobs by reducing barriers to trans-Atlantic trade.

‪Secretary Bryson also met with Hans-Peter Keitel, Chairman of the Federation of German Industries (BDI) along with representatives from companies across various sectors, ranging from industrial to IT to automotive and manufacturing. The Secretary encouraged the businesses to consider further investment in the United States, highlighting the attractiveness of the investment climate, including the resources provided by SelectUSA, the first coordinated effort by the U.S. government to attract new business investments to America.


Exports, Foreign Direct Investment, and Greener Fuel to Jumpstart Georgia’s Economy

Image of Georgia biomass facility

Guest blog post by Acting Assistant Secretary of Commerce for Economic Development Matt Erskine

As they search for opportunities to grow their economies and create jobs, no region in the United States can really choose to ignore the global marketplace—in fact, it just makes common sense. The latest export numbers bear this out: Since 2009, record-breaking levels of U.S. exports have supported an additional 1.2 million American jobs. And in March, the latest figures show that U.S. exports increased 2.9 percent, the largest increase since July 2011.

The benefits of increased engagement with world markets is something that the city of Waycross, Georgia, has experienced firsthand. In 2010, local authorities successfully concluded negotiations with a German energy firm, RWE Innogy, to build a new $135 million wood pellet manufacturing plant in the Waycross–Ware County Industrial Park. The pellets, which are produced from locally-sourced wood, are used as a cleaner-burning substitute for coal in the generation of electricity. A challenge was making sure that these pellets could be shipped quickly and cost effectively to major transportation hubs. A $1.3 million grant from the Economic Development Administration (EDA) resolved this by funding the construction of a new rail spur, ensuring that the pellets could be shipped to the port of Savannah and from there to overseas buyers.