Every lost manufacturing job means the loss of around 2.3 other jobs in the economy (e.g. in research and design). Manufacturing’s decline slows economic growth. While manufacturing represents 10% of the jobs in the economy, job loss in manufacturing hits nearly 30% of the economy.
There is a structural weakness in our manufacturing. Our manufacturing is not competitive. Invasion of import competition from China was responsible for between one‐quarter to more than one‐half of the lost manufacturing jobs in the 2000s.
A new report – published by The Information Technology & Innovation Foundation – states that “the loss of manufacturing is due to underinvestment in manufacturing technology support policies (…), among others.”
Underinvestment in medium- and high-technology is causing a structural decline of our economy. To be able to use those technologies, we of course need high-tech skills.
The current situation of manufacturing is like having a weakened immune system.
Without the right system of cells you will never keep the integrity of the body intact.
The body has soldiers, members of the immune system army: the B-cell and the T-cell. The dutiful soldiers get into action the moment any foreign substance or agent enters our body. B-cells circulate all around the body in the bloodstream, and eventually bind to the agent. T-cells circulate in the bloodstream and lymph and kill the agent. The blood and lymph systems are responsible for transporting the soldiers of the immune system.
The blood stream is our education system.
The B-cells are our high-level technologies.
The T-cells are our highly-skilled workers.
They are our protective shields to combat infections. If our cells are not strong enough, viruses are attacking our vital organs.
Germany, Korea and Japan have transformed to high-skilled manufacturing. They have a significantly higher share of their manufacturing output in high-tech and medium-high-tech industries than the United States; they have transformed their manufacturing industries toward more complex, higher-value-added production. They face less competition, so they increase their manufacturing employment.
More and stronger cells, a better blood stream, a stronger immune system that shows higher productivity is required for strong health.
More students, more advanced technology, better education is required for economic success.
With a strong manufacturing immune system, the economy would be much healthier.
“In 1850, a decade before the Civil War, the United States’ economy was small — it wasn’t much bigger than Italy’s. Forty years later, it was the largest economy in the world. What happened in between was (…) the rise of steel and manufacturing — and the economy was never the same,” says W. Brian Arthur, an economist and technology thinker.
Since ages manufacturing is quietly, for many people unnoticeably, transforming the economy.
Manufacturing is silent, invisible and unseen.
Much like the root system for aspen trees, Arthur observes. “For every acre of aspen trees above the ground, there’s about ten miles of roots underneath, all interconnected with one another, “communicating” with each other.”
The observable physical world of aspen trees hides an unseen underground root system.
Just like trees, CNC machine tools are creating for us — slowly, quietly, and steadily — a different world.
Think about this: the success of Steve Jobs was based on CNC manufacturing machines, based on the invisible roots undergound: Apple puts CNC Machining Front and Center.
School principal Mr. José António Gomes feels that that investing in the Haas VF-2 isn’t just right, but is also risk-free. “First of all,” he says, “it’s risk free because of the quality of the Haas machines, but also because of the well-known service capabilities of After Sales. But, maybe more importantly, even when the economy is down, the best investment is in knowledge. With knowledge, there is no risk of devaluation or depreciation. Giving our young people the ability to make things with 5-axis technology will never be a waste of money.”
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As most readers know, Haas Automation’s European HTEC (Haas Technical Education Centre) programme continues to go from strength-to-strength, as more and more schools on the Continent invest in the latest Haas machine tool technology to create state-of-the-art CNC teaching facilities.
However, not every school that invests in Haas machines chooses to be an HTEC. Some have more specific requirements. In the case of two, recently opened teaching-workshops in Spain and Portugal, that requirement was for low-cost, high capability 5-axis machine tools.
The Centro de Formação Profissional of Águeda, Portugal, opened on July 7th, 2011, and the IES Politécnico de Vigo, Spain, opened on July 8th. Each school has invested in a Haas VF-2 CNC machining centre equipped with a Haas TRT160 – a tilting 160 mm, 2-axis CNC rotary table, giving 5, simultaneous cutting axes. Both machines are supplied and supported by the local Haas Factory Outlet, a division of Portugal-based After Sales, SA.
Águeda’s economy has a strong, metal processing sector. “Two things are keeping this region healthy,” says mayor, Mr. Gil Nadais: “agriculture and metal manufacturing. We need to increase our turnover in these key export sectors and investing in innovative technology is essential for the future of this region.” School principal Mr. José António Gomes feels that that investing in the Haas VF-2 isn’t just right, but is also risk-free.
“First of all,” he says, “it’s risk free because of the quality of the Haas machines, but also because of the well-known service capabilities of After Sales. But, maybe more importantly, even when the economy is down, the best investment is in knowledge. With knowledge, there is no risk of devaluation or depreciation. Giving our young people the ability to make things with 5-axis technology will never be a waste of money.”
The economy in Vigo, Spain, Galicia’s economic powerhouse, relies heavily on local automotive manufacturing. Mr. Antonio Estévez is headmaster at IES Politéchnico de Vigo. “Our priority is ensuring the car industry can find people skilled in mechanical engineering and maintenance,” he says. “Each year we invest in the latest equipment to ensure our students have the most up to date and practical preparation possible. The five axis Haas VF-2 is the right investment to develop skills that Galician companies need.”
Several Haas industry partner companies – including Mastercam, Sandvik, Chick and Cimcool, also supported the grand openings of the two new teaching workshops. Managing Director of After Sales SA, Mr. Carlos Vilas-Boas feels that the role of his HFO is, in many instances, one of facilitator. “We take service and support very seriously,” he says, “and we believe it includes connecting students, teachers, employers, technology companies and politicians. These two events are good examples of how, when we all work together, the benefits are better training and, ultimately, greater productivity and stronger economies.”
Haas Europe HTEC coordinator Mr. Bert Maes also attended the grand openings. “These two schools have forward-looking managers and top-quality, industry-experienced teachers,” he says. “Combined with the easy-to-use Haas 5th axis technology, the result is highly skilled and motivated students with the technical ability to build complex projects like the ones I’ve seen today: from small wind-powered generators to fully-functioning customised, computer mice. I am convinced that many companies in Portugal and Galicia will benefit from the time and energy After Sales is investing in these important schools.”
So many times people are asking me: “We are living in a service-based economy. Manufacturing is not viable anymore. So what the **** are you doing there?”
Well, my answer typically is:
Yes, we are living in a service-based economy: in high-income countries 75%-87% of the economic growth is generated by services. 13%-25% comes from goods-producing industries.
But the problem is: this is not creating wealth — it actually fuels our national debts.
We cannot live from services alone. Poor regions and nations typically import more than they can afford OR they fail to produce a wide, diverse, creative range of physical products and export them. Economic success is simply the result of a process of constant, new & differentiated exports.
What we should be doing is follow a very old concept invented by Jane Jacobs:the import-replacement theory. That would make us earn money… Today, we stay behind with importing stuff, losing money, governments that have to loan, and in the end can’t pay for the interest anymore, bringing us close to bankruptcy.
Also the banks still haven’t learned anything: they still have the luxury to play around with other people’s money. When they screw up, and lose millions, they don’t care. The government doesn’t mind. A manufacturing business instead gets the raw material in, and makes a finished product. “When you screw up, you pay from your own pocket,” says Franc Coenen “The economy is at risk when you count on companies that just sell ‘air’ and don’t add value.”
Is there a reason why we cannot be the best in the art of ‘import-replacing’ again?
The Chinese are not the problem. Jobs and industry always move to the cheapest and easiest manufacturing market.
In the 60s and 70s it was Japan, then South Korea, Taiwan, Singapore, Malaysia and Hong Kong took the manufacturing lead in producing ‘junk’ products in large quantities. Those countries got better in higher quality products, the people grew richer, workers demanded higher wages and benefits and the local standards of living were raised, resulting in higher costs of production.
Now India and China are the biggest and best at this game. “But recently rising labor costs have pushed some Chinese manufacturing to places like Vietnam,” Tom Saler reports.
In her 2004 book Dark Age Ahead Jane Jacobs argued that our civilization shows signs of spiral of decline comparable to the collapse of the Roman empire. We depend on 5 pillars to stand firm, she says: family and community, education, science, representational government and taxes, and corporate and professional accountability.
So to be the industrial and innovative leader, we have to pay the costs of new technologies and the corresponding training. Being more innovative means having better people. The source of better skills and better productivity is better education and better training in science.
Our greatest resources for innovation are many young, independent, highly-skilled hands-on thinkers and creators. We can’t grow our economy if we can’t attract younger generations to our industry and if we keep forcing many of our schools to close their metal shops.
Key is the investment and involvement of companies into local technical schools. We must help our young people get interested in ‘making things’, in becoming leaders in manufacturing, in saving our economy.
If it were even possible to sum up change to the real world of today’s manufacturing in one sentence, it would be: “Fewer employees on more teams, using more technology to make crucial decisions morequickly.”
Most production operations no longer require legions ofemployees who simply push buttons and follow an only occasionally varying routine. The modern factory is no longer a just giant building filled with hundreds of interchangeable low-skill, low-wage full-time employees.
Many growing manufacturing organizations report a greater need for workers with teamwork, decision making, technology, communication, and customer service skills.
Which key traits are most important to the immediate present as well as the future of manufacturing?
Changes in the required skills and traits for manufacturing personnel
Ability to verify information, recognize patterns, analyze data sets, and synthesize.
Understanding of free enterprise and personal finance; appreciation of and ability to produce quality work products
Success in making and critiquing an argument, participating on a diverse team, and dealing with paradox
Ability to communicate in a variety of media, to participate in networks, and to navigate distributed organizations.
Track record of personal management and initiative demonstrating independent work and judgment
This shows that the need for CNC machining specialists will grow in the next decade(s) and play a significant role in the future of manufacturing.
Most importantly, young people will need to bring high-tech skills and the ability to create more efficient manufacturing and supply chain processes and evolve in automated systems specialists and manufacturing process experts.
Finland is one of the world’s strongest nations for manufacturing and education. But often the link is missing between schools and the local CNC enterprises. Haas Automation now partnered with the North Karelia College of Technology and Culture in Joensuu to build those connections towards the best professional training.
“As well as being the most northerly, this is also the first Haas Technical Education Center (HTEC) in Finland,” says Bert Maes, HTEC coordinator for Haas Automation Europe. “The OECD acknowledges that the country is one of the world’s strongest nations for manufacturing and the quality of its education. We’re delighted to support the next phase of excellence: building long-term collaboration between technical schools and CNC firms.”
Jyrki Turunen, school principal said: “Our vision for the students and for industry in North Karelia is focused on one, very important goal: to create a modern learning environment that will enable us to encourage and nurture ‘super technicians’ who will go farther in their education and careers than they or anyone else can currently imagine. We want to make CNC so interesting that it absorbs them during the daytime, and so fascinating that when they go home they dream about it at night.”
In 2004 and 2008 North Karelia College earned the Quality Award for Vocational Education and Training from the Ministry of Education. Last year it came second. Ara Hayrabedian, international coordinator at the college believes that being part of the HTEC programme will help the school secure the number one spot again. “The partnership with Haas Automation and its Finnish representative Grönblom brings a new way of thinking. Their support is helping us to develop new methods of teaching, to increase the motivation and to improve the skills of the young people who study here. We will also benefit from the international connections that the HTEC program brings, when we establish links with other HTECs across Europe.”
Representing the local Haas distributor Oy Grönblom Ab, Petteri Heinonen voiced the view of all those actively engaged in supplying and using manufacturing technology. “Technical education should closely follow industry’s development and needs,” he said. “In the future manufacturing will be more and more technology-driven. Students at the North Karelia College will get the best opportunities and companies will get the skills they need thanks to the professional training and the Haas CNC machine tools the college is now providing.”
Students at the North Karelia College of Technology and Culture, Joensuu, Finland (Pohjois-Karjalan Ammattiopisto), will be instructed on three Haas CNC machine tools (a TL-1 Toolroom Lathe, a TM-1 Toolroom Mill, and an SL-20 CNC turning centre) and a range of state-of-the-art production equipment supplied by the HTEC industry partners.
A few weeks ago I established a new partnership with a school on the Island of Madeira. That is a most rewarding collaboration. See the story below.
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Haas Automation Europe (HAE) is delighted to announce the Grand Opening of the first Haas Technical Education Centre (HTEC) on Madeira, Portugal.
The new facility was opened in Funchal on March 7th and forms part of the city’s Professional Skills Qualification Centre (Direcção Regional de Qualificação Profissional – DRQP). The Madeira archipelago is off the coast of North Africa, in the Atlantic Ocean, which makes this the most westerly of Europe’s 46 Haas Technical Education Centers (HTECs); almost 5000km by air from the most easterly facility.
As well as being covered by state TV, the HTEC Grand Opening event was attended by senior government official Sr. Francisco Fernandes, Regional Secretary of Education and Culture, and directors of DRQP Sra. Sara Relvas and Sra. Elda Pedro. After speeches and the presentation of the HTEC plaque, Sr. Fernandes told press and visitors why he thought the new workshop is important.
“The DRQP now belongs to a network of engineering excellence,” he said, “giving students on the island access to strong international resources.” Sr. Relvas reiterated his comments, and added: “Because Haas Automation CNC machine tools are present at so many of the best international manufacturing companies, this HTEC will help our youth prepare themselves for opportunities in the rest of the European and international labour markets”.
The Funchal HTEC is in collaboration with the Portugal Haas Factory Outlet (HFO) – a division of After Sales, S. A. The director and owner of After Sales, Carlos Vilas-Boas, was instrumental in setting-up the new facility, and the other 4 on the Portugal mainland. “As with all HTECs,” he said, “this new laboratory and workshop houses the latest CNC metal cutting and precision engineering technology. We see that having access to these facilities inspires and engages the students and their teachers, which makes us very proud and committed to continue working with the DRQP.”
Madeira is the second richest Portuguese region after Lisbon and boasts a per capita GDP higher than the EU average. However, the island generates much of its income from tourism, and food and wine production, which means youngsters who want to pursue a career in manufacturing have, traditionally, had few options but to travel.
“Many of Madeira’s young people will leave the island and work on mainland Portugal, in Canada, the United Kingdom and the Netherlands,” says Haas Europe HTEC coordinator, Mr. Bert Maes. “We’re sure that the high-tech Haas CNC machine tools, the clean learning environment and belonging to our network of international HTEC centers will greatly contribute to the motivation, satisfaction and international career possibilities of these students.”
The management consulting company touches concepts such as hyper-customization & crowdsourcing, respond more quickly and accurately to customer needs, and tightly align with suppliers.
But they admit that all these strategic activities and new models hinges on having young people with the right skills on the shop floor.
A first-order challenge in this regard will be getting enough people with the right “thinking” skills (beyond operator skills or pure technical skills), coaching and management skills to regions where operations are expanding or being put in place. Advanced analytical skills will be in especially high demand, says Accenture.
The challenge today is to teach young people the skills to interpret quantitative methods from data in customer behavior, the supply chain, product development, and production lines, and then use those insights to shape business decisions and, ultimately, to improve outcomes.
Manufacturers seems to have loads of shop floor data, but many struggle to make sense of it all. The goal is to use real-time data from shop-floor systems to quickly anticipate problems in cost, quality, productivity, or customer service so that staff can make immediate course corrections.
But, shortfalls of skilled labor are projected for the fastest-growing markets. India faces a potential shortage of 2.45 million engineers by 2020, and China’s gap in skilled professionals could reach 5.9 million by 2015. This raises serious questions about whether education systems, societies and individuals understand the demand issue correctly. The younger generation does not step up its technical, maths and business management skills.
And a lack of quality training and education also contributes to the shortages. Given the increasing complexity of technology, people will need more quality education, not less. And this needs to be done on the most modern equipment. None of the young talents will want to learn old systems.
A great approach is the Stepping Up To Algebra program, designed for 7th grade students who struggle in math. Xavier testifies “I never liked math, I always got bad grades, until I got into Stepping Up To Algebra. My teacher made me feel like I could be successful in math and that I was good enough to go to college. The field trip to San Jose State and the engineering department was great, and made me start thinking about college. Now I want to be an engineer.”
But even if the quality of education improves, there appears to be a cultural aversion among youngsters to enter the STEM disciplines. Parents must encourage their children to enter these disciplines. Parent engagement is the cornerstone of academic achievement. And studying in technical fields is absolutely worth it.
Aimed at secondary school graduates and students, the clip illustrates that the metal-transforming industry offers a dynamic environment where innovation, development and potential for exciting careers are the reasons for continuing investment.
Illustrating a series of shots of young people enjoying leisure activities, the video clip projects them into a near future in which their career in the metalworking industries will have a significant impact for all of us.
European Commission Endorses First European HTEC Student Exchange
The groundbreaking Haas Technical Education Centre (HTEC) CNC training programme recently received a resounding endorsement from the European Commission, which has agreed to sponsor and support the first international HTEC student exchange, in Spring 2011.
Between March 27th and April 9th, ten students and two teachers from the Belgian HTEC VTI St-Lucas Oudenaarde will travel to Sweden where they will work and study at host facility HTEC-Bäckadalsgymnasiet, in Jönköping. This exciting exchange is being staged and managed by Haas Automation Europe and five partner organisations, including the 2 HTECs, the Swedish Haas Factory Outlet (a division of Edströms) and two Swedish manufacturing companies, Linto and Fagerhult.
“This is a very exciting development for the two pioneer schools and its students,” says Haas Europe HTEC coordinator, Mr. Bert Maes. “The HTEC network is the ideal platform for connecting schools, CNC teachers and students at an international level. Any school that commits to the HTEC program can benefit from international exchanges, and with the backing of the European Commission, HTEC students have wonderful opportunities to travel and learn.”
This exchange program will allow teachers from the Belgian HTEC to cooperate with their Swedish colleagues and exchange ideas and best-practice for training young people as CNC machine tool specialists. At the state-of-the-art Swedish HTEC, the Belgian students will be further familiarised with the latest Haas CNC machine tools, as well as with new techniques in CAD/CAM, automatic welding, industrial design, 3D scanning and vacuum modeling.
The Swedish companies Linto and Fagerhult have agreed to mentor students during the ten days, with each student spending five days at each company. During their time at tool manufacturer Linto, the students will experience how the company’s 14 Haas CNC machines are employed and optimised in a demanding production environment. At Fagerhult, the students will study the manufacture of lighting systems, from raw material through to finished product, with a special focus on energy saving solutions and techniques.
Mr. Maes concludes: “From its investigation, the European Commission has ascertained that this HTEC student exchange is significant for European industry. The students will not only be exposed to innovative technologies, but they will also practice their skills in problem solving and working in teams, as well as learning how to adapt to different work cultures. We believe that companies who eventually hire these young specialists will benefit tremendously from their experience and international outlook.”
HTEC – The Concept
The HTEC initiative is a partnership between European educational establishments, Haas Automation Europe (HAE), its distributor-owned HFOs (Haas Factory Outlets) and an alliance of industry leading, CNC technology partners. HAE launched the HTEC programme in 2007 to counter what it regards as one of the greatest threats to the continent’s sustainable economic development: Namely, a shortage of talented and motivated young people entering the precision engineering industry with CNC machining skills.
The programme provides Haas CNC machine tools to educational establishments in Europe, so enabling HTEC students to become familiar with the latest CNC machining technology. This hands-on experience ensures students graduate with transferable skills and better employment opportunities. Haas Technical Education Centres also benefit local and national engineering companies by increasing the supply of well-educated apprentices.
Since launch, the HTEC initiative has expanded rapidly across Europe. Governments – from Sweden to Romania and from Portugal to Russia – have enthusiastically backed the programme and recognise the need to build a stronger manufacturing infrastructure.
The HTEC Industry Partners are some of the best-known names in precision manufacturing technologies and have demonstrated a strong, ongoing commitment to the HTEC objectives, backing them with the investment of time and resources. Currently, the HTEC Industry Partner network comprises KELLER, MasterCam, Esprit, Renishaw, Sandvik Coromant, Schunk, Blaser, Urma, Chick, Air Turbine Technology, Hainbuch, and CIMCOOL.
For over 200 years, man has been surrounding himself with machines. They shaped our lives. They shaped our history. And our future.
They changed the very nature of our being. Everything we touch is touched by them first.
They are everywhere.
They redefine the boundaries of what is possible and they push back the edge of our experience.
[CNC] manufacturing is the backbone of our society: [CNC artists are] engineers, designers and programmers all wrapped in one person, using processes and technology for extreme achievement.
According to those studies, the best manufacturing policies first of all depend on two criteria
(1) Whether you live in a low-income, middle-income or high-income country;
(2) Whether you operate in an innovative start-up industry or in a mature sector.
(1.a.) The manufacturing situation in HIGH-INCOME economies
(in total 54 countries including Australia, Canada, Hong Kong, Japan, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, the Netherlands, Portugal, Spain, Sweden, the UK, Norway, Singapore, Switzerland and the US):
Between 1995 and 2005 services generated ALL job growth in high-income countries, and between 75%-87% of the economic growth. Only 13-25% came from goods-producing industries. Between 1985 and 2005 manufacturing contributed 0,3% to growth, services accounted for 2,2%. The employment powerhouses and growth sources were retail trade, restaurants, construction and those services that bring process innovations. Some predict a substantial employment growth in IT & telecom, private equity, construction and environmental services by 2014, as well as car & automotive manufacturing and mining, oil & gas machinery manufacturing.
These are of course statistics from 2005. Since then the situation changed drastically. The oversized financial industry did hurt the broader economy the past years. At this moment “making goods is — with exceptions — more productive than providing services, and rising productivity is the fundamental source of prosperity… a major nation must be able to maintain a balanced current and trade account over time, and goods are far more tradable than services. Without something to export, a nation will either become over-indebted or forced to reduce its standard of living,” says economist and author Jeff Madrick. Since there is no economy that would have sustained rapid growth without substantial contribution from its industrial sector, at this moment, increased growth depends on the performance of manufacturing! “Today manufacturing is doing more to lead us out of the recession than any other industry.“
(1.b.) Manufacturing situation in MID-INCOME countries
(In total 93 countries including Argentina, Bulgaria, China, Colombia, Costa Rica, Egypt, Hungary, Jordan, Peru, Philippines, Poland, Romania, Slovakia, Sri Lanka, Thailand, Russia and Turkey)
85% of net new jobs comes from service sectors, including utilities, broadband telecommunications, supermarkets, hotels and restaurants, finance and insurance, construction, IT and software activities, R&D, digital media etcetera.
But the manufacturing industry (including pharmaceuticals, radio-TV-communication equipment, motor vehicles, cloth and apparel, food, drinks, tobacco, oil, coal, basic material, agriculture and forestry) contributes 46% of all growth (Russia for example 39%, China 55%). So in these countries the performance of expanding industrial sectors is critical to the economy.
(1.c.) Manufacturing in LOW-INCOME countries(61 countries including the African continent, Pakistan, Uzbekistan, Vietnam, Afghanistan, India and Nepal)
Educating has to be one of the highest priorities for public policy, to deliver the necessary trained business and scientific talent. Truly competing and winning in the long term will require local know-how and talent. Local capacity-building programs, attractive career paths, and apprenticeship opportunities will be critical to achieve sustained growth.
The other highest priorities include infrastructure development (transport, fuel, water, energy, port, airport, roads) and regulation, including a strong stable government, upholding the rule of law, creating a more predictable business environment. The current poor performance in these fields complicates the importation of equipment and materials, and makes the overall manufacturing costs very high.
Expanding manufacturing, however, increases exports and reduces the need the need for imports, easing these countries’ current-account deficits. So precisely manufacturing is essential to make continued investments in infrastructure and education.
(2.a.) Best government actions in MATURE manufacturing sectors
After being highly dynamic and generating growth to other sectors, the semiconductor industry today employs only 0.5% of the workforce. The last 15 years semiconductors didn’t generate sustained growth – public investments have led to very low returns.
There is a similar situation in the cleantech solar/wind power and biomass industry. The global markets in this area are already subject to heavy competition and as a result this market will not bring enormous job creation. The sector will remain too small to make a serious difference to economy-wide growth. New jobs in this green technology production is more likely to come from improving building insulation and replacing obsolete heating and cooling equipment.
Mature manufacturing markets best benefit from expanded infrastructure construction (roads, ports, high speed telecommunication, research labs, parks and training centers), improved access to capital, support in R&D through universities or other research funds, reduced trade protections, export assistance, faster and streamlined government regulations, enhanced access to raw materials and logistical effectiveness, focus on quality of education and technology-driven retraining to acquire a skilled workforce – at the right cost – that can continuously deliver new products for new generation of technology, in low-cost production.
(2.b.) Best government actions in INNOVATIVE START-UP industries
Protecting local producers has helped create local industries in a sector’s early development phase, but it led to low productivity and higher costs to consumers, with limited growth. Removing trade and investment barriers at the right time, with exposure to global competition, significantly improves performance and productivity.
Innovative high-quality ‘original technology’ industry start-ups should get government contracts, low-cost loans for investment, reduced raw materials/energy/logistics costs, long term large government investing in channeled R&D funding and expanding necessary education, support from private companies and university research to develop new technologies together, and attracting smaller companies to form clusters, which help create a sustainable pool of talent and expertise. But remember, this only works in brand-new industries.
Conclusion: designing and implementing manufacturing policies to improve growth and competitiveness are not easy. Taking into consideration the maturity of the country and the maturity of the industry will boost the odds of policy changes having a positive impact.
1. Technology is pushing in two directions—bigger and smaller. Manufacturers will continue to find fresh fields by meeting the demands for workpieces that are significantly different in scale from mid-sized parts with mid-sized tolerances. (see article: Going to Extremes)
3. As material prices increase the cost of stock, and as technologies such as 3D printing improve, manufacturers will increasingly employ additive part-making as an additional option alongside CNC machining. (also read: “In the manufacturing industry of the future, sophisticated 3D automation and robots will play the key roles.”)
4. Even though manufacturing facilities have reduced their staff, demographics still predict an industry-challenging lack of technical and engineering talent. Young people are not entering manufacturing at a rate that is anywhere near fast enough to replace those who will retire. (Check: US Report Skills Shortage and EU Report Skills Shortage)
5. On the other hand, population trends also bode well for U.S. manufacturers. A surge in new consumers is coming: the Millenials. This upcoming generation’s expectation of variety will favor short production runs. This in turn will favor an increased reliance on manufacturing in the United States. (also view: beat offshoring by having a local ready stock and producing fasterthan firms with foreign factories.)
6. Manufacturing enterprises are much more diverse than what the government and media seem to be able to imagine. Much of our national conversation about manufacturing still focuses almost solely on “factory” production. (see article: The “factory” is one way we organize people and capital to produce real and useful things – but team of mechanically-minded people who come together is just enough)
7. The skills and other attributes needed in modern manufacturing are getting more difficult to define, particularly for small and lean facilities. The people who can best recognize these attributes are likely to be the ones who already have them. A manufacturer’s current employees are probably its best link to new employees. (find out: The 7 skills we should teach in technical education.)
8. Traditionally, the start-up shop was a job shop. Tomorrow, it might just as well be a captive shop. Cheaper, smaller and easier manufacturing equipment will produce a new sector: “basement manufacturing” of niche or custom products. (see articles: (1) machine tools used in non-shop locations and (2)the small batch movement, an example of the current Third Industrial Revolution in manufacturing)
9. Tool steel? Try tool aluminum. As product lives shrink, steel won’t automatically be the moldmaking material of choice. Increasingly, what was once called “soft” tooling will be seen as full production tooling.
10. Similar to what occurred in the aircraft industry some time ago, the medical device industry will be colonized by regulators. Processes will face new validation requirements, and the pace of innovation will slow. The requirements will also create barriers to competition, resulting in small and nimble manufacturers becoming large and established ones.
11. Any manufacturer today should look out across the production floor and ask: What would my process look like if it was more automated? Then ask: What steps can I take today to move in that direction? (also read: Automation protects the future of our economy’s manufacturing base.)
12. The United States is the world leader in terms of global manufacturing market share. U.S. manufacturing also has become significantly leaner, cleaner, more efficient and more responsive in just the last few years. To be sure, there are challenges. However, the idea that the United States is turning away from manufacturing is dramatically overstated. U.S. manufacturing will remain a leading economic force in the world for a long time to come.
As a new school year quickly approaches, it’s time for both students and educators to evaluate where the jobs are and where they will be in the years to come.
And it’s the job of us manufacturers to show them.
By 2018, the American manufacturing workforce is projected to decline by 9 percent, an estimated 1.2 million fewer workers, according to the United States Department of Labor. That leaves a lot of holes to fill.
American manufacturers can make up some of this gap by increasing efficiency, extending the trend of productivity gains we’ve been achieving over the last decade. Technological advancements continue to drive efficiency and output across the nation.
However, with our shrinking manufacturing workforce, the question remains: who will carry on this recent success, and that of the industry as a whole, into the future? To prepare, leaders in manufacturing must put significant effort toward the technical education of the next generation in association with regional schools.
Even now, with unemployment at 9.5 percent, manufacturers are having a difficult time finding and retaining qualified people. That’s why we’re taking action through forming partnerships with many schools in Southeastern Wisconsin from Milwaukee to Madison – and accessing an enormous pool of talent in the process.
One of our closest partners is Waukesha County Technical College. We’re working with them to help shape the curriculum toward real-world industry advancements, so that educators can better identify the skill sets that are important to employers and ensure they’re supporting them throughout their programs.
For example, as manufacturers struggle to meet increasing demands with a decreasing workforce, automation education is ever more crucial. The workforce of the future must be fluent in programming workspace automation to maintain production levels when even fewer workers are available.
Members of the Manufacturers Alliance are also working to change public perception about manufacturing careers by getting school administrators and guidance counselors into our facilities. We need to show them that factories aren’t the gloomy, mundane places they imagine, but instead are bright, automated hubs of innovation and technology.
If more manufacturers band together like this to support and promote technical education, we can change the image of manufacturing careers and, while doing so, continue to emphasize the importance of the science and math skills pertinent to the industry.
I encourage all manufacturers to get involved in your schools and dedicate resources toward education. You, your company, the industry and the future of the country will be better off for it.
Steve Dyer is the president and CEO of Dickten Masch Plastics
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Nigel Platt, Sales & Marketing Manager for ABB Limited’s UK robotics, firmly believes that manufacturing presents a massive opportunity for achieving a more balanced and prosperous economy. But the challenge now is to make sure that the growth that has been achieved continues to be sustained and built on. That is why robots should be a key part of our industrial future.
Over the past 20 years, robot capabilities have evolved massively. Especially in the areas of precision, repeatability, flexibility, simplicity and affordability there has been vast improvements.
The interesting thing is that robots and other automation technology don’t necessarily threat manual labour. “Robots may have video guidance and intelligent path control, and might perform better than the most skilled manual workers, but they still require lots of highly-skilled people to program and operate them,” says Platt. With the high level of deskilling in recent years, the vanishing of traditional manual engineering roles (resulting in a shortage of skilled operators), there are not a lot of other ways than robots and automation to protect the future of our economy’s manufacturing base.
Also with our high costs for raw materials and energy in particular, it’s vitally important for manufacturing companies to get products right first time while doing things better, more quickly and for less cost in order to outperform the next best company.
Whether it’s reducing breakages in a food packaging line or cutting and finishing metal products, robots can deliver precise and consistent performance at a much higher speed, enabling companies to increase yield and reduce overall production times whilst typically enhancing product quality. Even the smallest operations can now benefit just as much from robotic technology as a large automotive company. Introducing even just one robot to the factory floor resulted in benefits, ranging from reduced production costs even through to reduced energy consumption by turning off lighting and heating in the area where the robots are installed.
For manufacturing enterprises, technology start-ups or technical educational establishments there are ‘10 good reasons to invest in robots’:
1. Reduced operating costs
2. Improved product quality and consistency
3. Improved quality of work for employees
4. Increased production output rates
5. Increased product manufacturing flexibility
6. Reduced material waste and increased yield
7. Compliance with safety rules and improved workplace health and safety
8. Reduced labour turnover
9. Reduced capital costs
10. Optimising space in high-value manufacturing areas
Where training is concerned, ABB is actively fostering partnerships with technical colleges throughout the UK to help equip the next generation of engineers with the skills to operate, program and integrate robotic equipment into industrial applications. An example is our work with the New Engineering Foundation (NEF), where we run master classes in robotics for lecturers from technical colleges demonstrating the application of robotic technology, which they can then teach to their own students.
We also have the largest, dedicated industrial robot training school in the UK, based in Milton Keynes, which has recently invested £100,000 in new robots for some of its 10 cells, along with classroom materials. This school is open to representatives from any company wanting to get a better perspective on what robots can do.
With the right education and with the right technology investments we will be able to have a sustainable manufacturing base, producing innovative goods at competitive costs on home turf.
At 15 years old, Mike Goetz ran his first successful CNC machine job shop – after school and on weekends – from his parent’s garage.
Goetz Industries, of Lombard, Illinois, is now an “insanely busy,” four-man specialty shop producing high precision aerospace and electronics-industry parts for an enviable troop of Fortune 500 clients. And now, owner/operator/director/programmer/machinist Mike Goetz is a seasoned veteran . . . of 19.
His story is one of natural ability and desire, driven by endless fascination with “what machines can be persuaded to do.”
Mike started out as a curious kid. He liked mechanical things, especially bicycles, and “the idea of making stuff.” When the opportunity to sign up for a middle-school shop class came along in 6th-grade, he jumped at it – and was immediately disappointed.
“It was a really sorry class,” he smiles. “The first thing the shop teacher stressed was that we couldn’t use anything ‘dangerous,’ like a saw. So all we got to do was make little balsa wood cars with files, and stuff like that.” Bored and curious, Mike wandered off into a back room one day and discovered what looked like a machine of some sort draped with a big, heavy tarp. “I lifted up a corner, and there it was – something I’d never even imagined.”
Under the cloth was an old-as-the-hills, crank-handle knee mill. It was left over from years before, when the building was home to a vocational high school. “There were still chips on it, and tooling lying around,” Mike remembers. “So I stared, put two and two together, and realized: You can cut sideways with this thing! I understood how it worked, and that this was the basis for machining metal.”
Not surprisingly, the cautious shop teacher would never let Mike use it, “. . . even when I offered to come in after school,” he says. But just the sight of the mill was a turning point. Mike began studying everything he could find on the subject of machining. “Before, I hadn’t a clue how things like my bicycle parts were made. But then it dawned on me – with a mill and a lathe, you could make anything!”
That epiphany started the ball rolling. With his parents’ help, Mike bought a manual hobby machine and set up shop in his basement to learn – and to make his own custom bicycle parts. Completely self-taught, he wore out tooling catalogs, learning what did what, and absorbed machining information off the Internet every night. “I learned there were few hard-and-fast rules for making parts, and I began to realize you can make anything if you have the right equipment.”
This led directly to his discovery of CNC, when he excitedly realized he could control equipment with computers. The idea intrigued him so much that he worked to get a little desktop CNC machine – then worked to master it. When people at a local bicycle shop (where the new teenager had taken a Saturday job) liked what they saw and offered to buy any extra copies of the “cool” parts, Mike found himself in business. With the help of his parents he got a Haas Mini Mill, and set up in the garage.
After a year and a half, feeling the need for more room and more independence, he moved into his present shop space and began adding machines.
“We now do a lot of 3rd- and 4th-axis work,” says Mike. “I have Haas HA5C rotaries on two machines, and that really helps out. We’re doing a ton of 3-D for the cell-phone industry, and a lot of fun, but really challenging, aerospace parts.” Part of the workload is subcontracted – full-4th-axis work other area shops won’t tackle in-house. “It’s really not that hard,” says the confident self-learner. “You just have to sit there and figure it out. The next thing for us will be going full-5th on some parts. I’d like to get a Haas trunnion for one of our machines.”
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“One thing I want to do is get more young people into the industry – but I see problems,” explains Mike Goetz, speaking from first-hand experience. “Most of the tech schools around here are still on manual equipment. I know you have to learn that basic stuff: there’s no way you can run one of these modern machines well without first spinning the wheels on an old knee mill. Otherwise, you don’t know what cutting pressures are involved, and you don’t really learn what a mill can do.
“But, they’re missing it by not hooking kids with cool projects and neat machines. They’re having them just mill blocks and drill holes. I think a lot of young people would be a lot more interested if they learned what they could make with modern CNC machines,” says Mike. “A lot of kids have no idea where things come from. I try to explain what I do, and they don’t get it. I tell them, ‘Almost everything starts on a machining center – whether it’s a mold, a prototype or the final product. It’s machined. You start off with a solid block, and you remove material to get what you want!’ But they can’t see it through; it’s just not being taught.
“I’m afraid we’re going to have a serious problem in a few years when all the older people start to retire,” he laments. “There’s going to be a real shortage of people who know what they’re doing. Manufacturing has a lot to do with the way this country is – we’ve got to get more people coming into the industry.”
We do expect continued growth in manufacturing of a fairly modest 5% or so this year and next year — which is stronger than the overall economy. I guess there are a couple of things driving that: One is exports have done well and we expect to continue to see growth in exports. Second, there is some recovery in investment in capital goods. It’s mostly metals inventory rebuilding and replenishing factories for equipment that has gone beyond its useful life. It’s not really adding to productive capacity; it is productivity improvement and simply replacement. Investment in equipment and software is growing, but still far below 2007/2008 levels. The only way to get faster growth in manufacturing is to bump up the export share.
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I BELIEVE THIS SHOWS THAT THE MOST DURABLE JOBS OF THE FUTURE INCLUDE:
Of course this all depends on
(1) increased confidence of companies and consumers to invest,
(2) healthier demand from exports markets,
(3) streamlined permitting processes to start up exports,
(4) a permanent favorable government business tax & fiscal policy in R&D, new technology, product development, increased efficiency etc,
(5) easier access to low cost credit finance conditions,
and (6) heavy & smart investments in technology-based education and export training.
“Outsourcing is not sustainable, it is not a business strategy.
To overcome the cost difference with low wage countries, businesses can be competitive by investing in technology, training and new manufacturing methods to raise productivity.
Innovation, high productivity, quality and more skilled workers are critical for keeping businesses competitive internationally.”
Bert Maes
Germany, Korea and Japan have transformed to high-skilled manufacturing. They have a significantly higher share of their manufacturing output in high-tech and medium-high-tech industries than the United States; they have transformed their manufacturing industries toward more complex, higher-value-added production. They face less competition, so they increase their manufacturing employment.
The Swedish companies 
The HTEC initiative is a partnership between European educational establishments, 
BERT MAES 