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 2009—a 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.
And, of course, manufacturing doesn’t just support production jobs; it also supports non-manufacturing jobs up and down the supply chain.
That is why across the administration, we are redoubling our efforts to promote a vibrant manufacturing sector. We are acting on the findings of a report that we released entitled, The Competitiveness and Innovative Capacity of the United State . It outlined steps needed to support America’s innovators and entrepreneurs. The report outlines a number of investments this country needs to make to remain competitive over the next two decades.
President Obama has proposed several things that we need to do right now to build on our strength in manufacturing. First, we should stop rewarding companies for outsourcing jobs overseas and start rewarding companies for bringing jobs back through insourcing. Second, we should put construction workers back on the job to repair our crumbling infrastructure. This will help our manufacturers send their products to customers as quickly as possible. We need to extend the middle class tax cuts for the 98 percent of Americans and 97 percent of America’s small businesses making less than $250,000 for another year, as President Obama has proposed. With these cuts, a typical family of four would see taxes rise by $2,200 if we don’t extend this through 2013.
Finally, the president is calling for a network of institutes focused on manufacturing innovation. At these hubs, we will bring together our top researchers, manufacturers, entrepreneurs, and other partners who can ensure that we continue to out-build and out-compete the rest of the world in the years ahead. Proposals for a pilot institute went out from the Department of Defense earlier this year. And very soon we will be announcing the winner.
Having an opportunity to discuss these and other important issues with U.S. manufacturers served as an important reminder that our collaboration is absolutely essential to ensuring that Made in America remains a strong slogan well into the future.