U.S. Secretary of Commerce Penny Pritzker Presents a Path Forward for American Manufacturing

Sep162015

AS PREPARED FOR DELIVERY
Wednesday, September 16, 2015

Today, U.S. Secretary of Commerce Penny Pritzker presented her vision of a path forward for innovation in U.S. manufacturing at the American Energy and Manufacturing Competitiveness Summit, hosted by the U.S. Department of Energy and the Council on Competitiveness.

Before a diverse group of private and public sector leaders, Secretary Pritzker discussed the investments needed to secure America’s competitive edge in advanced manufacturing, support smart economic development in communities nationwide, spur growth for our businesses, and strengthen the economic security of our workers and families.

Remarks as Prepared for Delivery

Thank you, Deborah Wince Smith, for your introduction. I also want to thank the Council on Competiveness and the Department of Energy for inviting me to speak here today.

I am proud of the strong partnership that exists between the Departments of Commerce and Energy. The Department of Energy is developing and deploying clean energy technology that is truly keeping our country on the cutting edge of commercialization and improving our energy security and efficiency.

I saw this firsthand during a recent visit to the Department’s Institute for Advanced Composites Manufacturing Innovation at the Oak Ridge Laboratory in Tennessee. In Oak Ridge, they have a working replica of a vintage 1965 Shelby Cobra sports car created entirely through 3D printing with carbon fiber-reinforced plastic. Let me emphasize this: using a 3D printer, they have made an entire car out of materials that are more efficient to produce, stronger and lighter than traditional metals, and can be recycled.

When President Obama visited Oak Ridge earlier this year, he stood in front of that very same car and said: “Places like this are who we are. We create. We innovate. We build.” Create, innovate, build: that is what America’s manufacturers – each of you in this room – have always done to spur and sustain our dynamic, growing economy.

Each of you has played an integral role in moving our economy from recession to recovery to expansion over the past seven years. Thanks to you, our country is in the midst of a manufacturing resurgence. For the first time since the 1990s, new factories are opening, and job growth in this sector is on the rise. Thanks to you, our unemployment rate stands at 5.1 percent, and our gross domestic product has expanded by 3.7 percent in the second quarter.

Yet even with this progress, challenges persist. Globalization, advances in technology, ease of transportation and communication, and the sheer pace of change have altered the conditions for America’s businesses and workers to enjoy sustained prosperity. Given these facts on the ground, the question for all of us in this room today is: What are the critical elements to keep America globally competitive? What can we do to expand our country’s manufacturing resurgence to benefit not just your businesses but our workers as well? What is America’s path forward?

The answer depends on the choices we make, in both business and in government, to protect the long-term prosperity of our economy. The future of our country depends on our willingness to work together to make key investments:

  • Key investments in innovation and entrepreneurship, so we can remain on the cutting edge;
  • Key investments in our communities, so we lay the groundwork for growth throughout the country;
  • Key investments in trade and exports, so U.S. companies and our workforce can compete and win in the global marketplace; and
  • Key investments in our people, so we utilize 100 percent of our talent.                                                                                                

Today, I want to discuss some of the Department of Commerce’s investments in securing America’s path forward as the world leader in manufacturing.

First, we must nourish and support our innovators and our entrepreneurs.   We know innovation is the lifeblood of our economy, supporting one-third of our economic growth. We know manufacturers are responsible for 75 percent of private sector research and development. We know that manufacturers receive roughly 70 percent of all the patents issued by the Department of Commerce. We know that having a cutting edge manufacturing sector that remains a step ahead of the global competition is not simply a “nice to have” – it is a “must have” for our country to thrive, now and in the future.

Recognizing that America’s competiveness is at stake, President Obama created the National Network for Manufacturing Innovation. This initiative breaks down silos between the private sector, universities, community colleges, NGOs, and the needed supply chains to collaborate on technology areas that have the potential to go from lab to market in the next 5 to 7 years.

Recently, I visited the NNMI institute in Youngstown, Ohio. The city’s leadership needed to rebuild their struggling local economy by reinventing its local manufacturing base as a modern, innovative hub. Youngstown partnered with this Administration to open America Makes – our very first advanced manufacturing institute, focused on research and development in 3D printing. In just three years, it has grown from 65 founding members to 142, working together to make it easier, cheaper, and more reliable to 3D-print products like medical devices and parts for aircraft engines.

America Makes is creating new jobs, spurring growth in the local economy, and making Youngstown an attractive hub for new and existing businesses, large and small. For example, GE recently announced a $32 million investment in a new 3D printing facility in the area; and ATI plans to invest $70 million into researching the use of cobalt-based powder as a key component in 3D printing. At America Makes and at the six other existing advanced manufacturing institutes, this Administration is partnering with the private sector to transform cities like Youngstown into hubs of innovation, trade, and commerce.

The Department of Commerce plays two important roles in the National Network for Manufacturing Innovation. First, we run the network of seven existing institutes – bringing them together to share best practices in technology development, attracting and retaining a talented workforce, supply chain management, and introducing new products to market. Second, we have the authority to establish new institutes in technology areas solely selected by industry.

I want to emphasize this point: you select the areas of focus. In our latest budget, we have requested funding for the first two new institutes where the private sector can determine the technology focus. The National Network for Manufacturing Innovation represents a smart way to spend our limited federal dollars.

But America’s path forward also requires us to work with our communities on developing strategic plans to build robust industrial ecosystems and grow their manufacturing sectors. At the Department of Commerce, we support our communities through the Investing in Manufacturing Communities Partnership – or IMCP – program. IMCP asks leaders in a region to identify a manufacturing sector where they have a comparative advantage and draft a comprehensive, strategic course of action that prioritizes the projects and investments needed locally to grow that sector.

This forces communities to focus on addressing the workforce and supply chain challenges; infrastructure needs; trade and investment goals; capital access issues; and operational improvements that will make them successful .The communities with the best plans are then eligible to receive funding from 11 different federal agencies to support the implementation of their strategy. By encouraging communities to break down silos and develop thoughtful, comprehensive approaches to their economic development, we try to ensure that precious federal dollars are used on high impact projects that maximize return on investment.

At the same time, communities need more than just a plan. They need reliable digital and physical infrastructure to connect manufacturers with their supply chain and customers, and to move their goods and services to market. You know that, to be successful, our communities must have high-speed internet access. Nationally, this Administration has invested in the installation of more than 113,000 miles of broadband. Yet more than 20 percent of homes in the United States still have no access to high-speed internet, placing our communities at a disadvantage.

You know that, to be successful, our communities must also have safe and dependable roads and bridges. Yet over the past decade, we have been funding our infrastructure in three-month increments and at levels that are not keeping up with our economy’s growth – a short-sighted approach that only serves to hamper our competiveness and hurt American businesses.

Right now, in Washington, Congress faces some important choices – about our infrastructure specifically and our budget more broadly. We need legislation that provides adequate long-term funding to support needed expansion of our broadband network, address infrastructure maintenance backlogs for our roads, and alleviate congestion for commuters. We also need Congress to pass a responsible budget that invests not only in our infrastructure but also in our economy, in our families, in our military readiness, and in our schools.

It really comes down to a basic choice: Will we pass a responsible budget that gives federal agencies like mine the certainty we need to plan for the year? Or will we leave the so-called “sequester” in place, which would automatically force short-sighted cuts to investments and services, regardless of their effect on our economic or national security? Or worse, will Congress risk shutting down the government for the second time in three years?

As business leaders, you understand that reducing your investments in your company is no way to grow and compete. In Washington, playing politics with our budget is no way to run the federal government when our global competiveness is at stake. We need leaders in the business community and in government to be clear that if we want to continue to lead the world, we must choose to make smart, necessary investments in our core priorities as a nation.

The current debate surrounding the budget is about funding the very foundation of our competitiveness here at home. But America’s path forward must also increase the opportunities for your businesses to access markets abroad. Everyone in this room knows that the clean energy sector shows immense potential for growth. Demand for clean energy has expanded beyond its traditional markets of North America and Europe, and is now truly global .Last year, 50 percent of the investment in renewables was in developing and emerging markets. And over the next 5 years, the cumulative opportunity for U.S. clean energy exporters is expected to reach $1.4 trillion.

To ensure that your companies can lead in every possible market, our Administration is negotiating tough, modern trade deals like the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership. We are also working on an Environmental Goods Agreement with sixteen other WTO members to eliminate tariffs on a wide range of clean technologies and expand the global market for our clean energy manufacturers.

In addition, the Commerce Department is using trade missions to ensure that American businesses have access to emerging markets. For example, in April, I brought a delegation of 24 American clean energy companies to China to explore new opportunities created by the landmark agreement between our nations to reduce carbon emissions.

Our Department has also hosted clean energy trade missions to markets like Japan, Peru, and South Africa, where demand for your expertise and our American made solutions is rapidly growing. By laying the groundwork now for American companies to succeed in these markets, we will expand your access to customers around the world, increase your growth opportunities, and improve your ability to create jobs.

Ultimately, the success of America’s path forward will depend on our most precious resource: our people and our workers. Indeed, if our country is to out-compete and continue to lead the rest of the world, we must prepare our workforce for the jobs of the 21st century.

To meet this task, for the first time, the Commerce Department has made workforce training a top priority. Through our “Skills for Business” initiative, we are breaking down silos and bringing together all of the stakeholders in your communities – including the private sector, community colleges, universities, non-profits, state and local governments – to better align training programs with the needs of businesses.

To lead in the global economy, it is not enough to simply arm America’s workforce with the skills to compete. We must also engage the next generation of workers and excite our youth about the potential of a career in manufacturing – but we have a problem. Among young people, manufacturing ranks last as an industry career choice. Our children view manufacturers as outdated factories filled with line jobs – not as innovative, inventive businesses, where workers develop and use the latest technology and build lasting, middle class careers.

To change this perception, we at the Department of Commerce created Manufacturing Day. On October 2nd of this year, more than 2,000 companies will invite students, career guidance counselors, parents, and workers to open houses, public tours, and career workshops at plants and factories across the country.

One of the companies that participated in our first Manufacturing Day in 2013 was Detroit Tool and Engineering – a small firm that has been producing custom automation systems for more than 80 years. Chris Monzyk– a student at a nearby technical college – took a tour of Detroit Tool and Engineering’s facility and saw firsthand how exciting a career in manufacturing can be.

To make a long story short, Detroit Tool and Engineering hired Chris when he graduated as a machinist. They gave him the specialized training he needed to perform his new job and matched him with a long time employee as his mentor. Today, Chris says that working in manufacturing is – and I quote – “fun, exciting, and new every day. I get to make something from virtually nothing. ”You in this room have the opportunity to make that kind of an impression on a young person.

I sincerely hope that you will participate in Manufacturing Day on October 2nd. More information is available at mfgday.com. And Erin Sparks from my policy team is here. Fun. Exciting. And new every day.

Chris’s words capture perfectly the state of today’s manufacturing sector as an innovative, constantly evolving field that can build lasting careers and stronger communities. Manufacturing must remain the backbone of America’s growing economy. We must choose to lead in manufacturing – and never take a back seat to other countries in the discovery and development of new innovations and technologies. We must choose to reward communities that develop clear, strategic plans to expand and strengthen their manufacturing base. We must choose to pave the way for the U.S. clean energy sector to be part of the solution to the planet’s environmental challenges. And we, in both government and business, must choose a path forward that keeps our manufacturers a step ahead, keeps our economy globally competitive, and keeps America open for business.

Thank you.

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