- Things are going well for manufacturers, but Washington needs to make sure that progress isn't obstructed, National Association of Manufacturers CEO Jay Timmons writes.
America's vaccination success story is very much a manufacturing success story.
Manufacturing in the U.S. proved — as it has throughout so many crises in years past — that it was made for this moment, and that it is ready to build the next, post-pandemic world to come. Today we can report that the state of the manufacturing industry is growing stronger with each vaccination.
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Our industry was able to survive and adapt to the pandemic because it is truly modern. Manufacturers are embracing a new industrial revolution powered by digital innovation.
Anyone who tours a manufacturing facility will see that 3D printing, virtual and augmented reality and all forms of smart Manufacturing 4.0 technology are now commonplace. And employees who showed up in person were protected from Covid-19 by advances in robotics and automation, as well as carefully redesigned shop floors that enable safe social distancing.
This innovation helped the manufacturing industry lead our country's disaster response. Manufacturers in the U.S. developed Covid vaccines within just one year of the pandemic's arrival. And companies from nearly every industry subsector, including the makers of automobiles, aerospace, apparel, food and beverages and countless other products, shifted and retooled their operations to produce personal protective equipment and other medical supplies for first responders.
It is no wonder that manufacturers are hopeful. The National Association of Manufacturers conducts a quarterly survey of manufacturers' outlook, and our most recent results showed that nearly 88% of manufacturers report a positive outlook for their businesses.
April market data from the Purchasing Managers' Index, a leading indicator of manufacturing health, show that new orders grew at the best rate in more than a decade, while exports reached an all-time high. The Kansas City Federal Reserve reported that manufacturing activity in April expanded at the fastest pace in the survey's history.
That's not to say there aren't headwinds, but our industry can and will overcome these obstacles. Whether it's creating jobs, solving environmental challenges, restoring faith in our institutions or other generational challenges, manufacturers are ready to lead.
But federal policymakers are contemplating some changes that would threaten manufacturing growth. Reversing course from the 2017 tax reforms and raising rates on small and large businesses would cost jobs and investment — 1 million jobs in just the first two years, in fact.
Other policy changes, particularly the Protecting the Right to Organize Act, could damage the employee-employer relationship, imposing card check on our workplaces, while price controls on lifesaving pharmaceuticals would harm our ability to respond to the next pandemic.
Supply chain vulnerabilities also threaten manufacturers. Whether it is a shortage in semiconductor production, extreme weather events, a blockage in a major waterway or even something as simple as traffic delays, supply chain disruptions are extremely costly for our industry. These disruptions are responsible for the empty shelves that many Americans experienced last year for the first time in generations.
Congress and the president can help us minimize these disruptions — or eliminate them entirely.
Manufacturers strongly support the president's plans for historic investments in physical infrastructure. Although manufacturers have modernized, our infrastructure is stuck in the 20th century. Repairing and upgrading our transportation systems, our wireless connectivity, energy infrastructure and more will make it easier for products and inputs to get where they need to be.
Manufacturing will also be strengthened by incentives for continued investment in research and development, regulatory certainty, flexibility for improved employer-sponsored health care, increased access to reliable American energy and expanded trade opportunities to export our products.
One of manufacturing's biggest ongoing challenges remains the skills gap. A new study conducted by Deloitte and the Manufacturing Institute, the NAM's workforce development and education partner, found that there could be 2.1 million manufacturing jobs left unfilled by 2030. If we don't fill these jobs, it could cost a staggering $1 trillion in lost economic growth in 2030 alone.
Our industry is working day and night to close this gap. Our Creators Wanted workforce campaign is going state to state to showcase the career opportunities in manufacturing. Congress and the president can help here as well, whether through tax credits for hiring and training new employees or comprehensive immigration reform to help strengthen our pipeline of talent.
Dreamers, for example, held hundreds of thousands of essential positions throughout the pandemic, and we need many more talented and dedicated people like them in our industry.
And as our country reckons with racial injustice and inequity, our industry is also working to close the opportunity gap — making sure manufacturing jobs are open to all communities. Importantly, industry leaders have committed to creating 300,000 pathways to job opportunities for people of color by 2025, so our industry is strengthened by America's diversity.
Manufacturers today are channeling the same spirit that helped our industry find a path forward for our country during the Space Race, the Great Depression, wars and last century's flu pandemic. The next, post-pandemic world will be better than anything we've known, and manufacturers will build it.
-Jay Timmons is the president and CEO of the National Association of Manufacturers.