Both the U.S. and the EU will have difficulties to compete on large-scale manufacturing again, but it can still continue to unlock value in its capacity to innovate.
What would be needed to unleash our creativity? A competitive strategy for any country should have four tall tent poles, according to Andrea Belz, specialist in strategies that transform innovation into profits:
1. Fund research, education and innovation programs.
3. Tax incentives for small companies to purchase new technologies and other capital goods.
4. Retain foreign talent.
“The risk is not that large-scale manufacturing will leave us,” Andrea Belz says,but “this is the last chance to stop the innovation train from departing as well.”
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.
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.
The message of all experts: government should take a greater role in making manufacturing (the foundation of the economy) more competitive and more productive. The NAM report says that all foreign countries use all the tools of their governments to support industry and as a result they outgun the United States.
Both NAM and the Business Roundtable rally against:
The high corporate taxes, especially the high tax rates for small businesses, as they are responsible for the bulk of the new jobs, and the best jobs;
The rigid labor regulations, wages and benefits, making flexible work arrangements impossible;
The tough environmental regulations without a global approach will impose additional expenses, create uncertainty and will damage the ability of manufacturers in the US to compete;
The non-existent R&D tax provisions that could stimulate investment, recovery, significant rise of GDP and strong job creation;
The insufficient focus on Intellectual Property and increased immigration (access qualified, highly skilled professionals around the globe), which should both be fixed to remain competitive;
The unfair (tariff) trade barriers China, India, Brazil, Europe, South America, Canada and Australia are constructing to protect and promote their own domestic manufacturing companies;
The underfunded tools to help small and mid-sized manufacturing export such as trade fairs, marketing assistance and the export-import bank;
The energy dependence without sufficient domestic supply of energy, coal, hydropower, gas, nuclear, renewable and alternative fuels:
The poor infrastructure in transportation and high-speed communications;
The uncertainty and danger of the ever increasing employer mandates and business costs of the health care reform;
The disappointing quality of education as the majority of manufacturers in America face a serious shortage of qualified employees, and cannot be given the certainty that they are hiring a skilled technical workforce when recruiting from schools.
Or in other words “SHOW US THE MONEY!” And then I ask myself the eternal question:
Government spending with lasting corporate tax cuts to boost economy and thus increase export earnings (“the only way to get us out of the recession”), but first lending more billions from mainly China (The current US debt to China is $2 trillion or $2 000 000 000 000) and threatening the nation’s future stability (potential new financial crises), security and independence. Additionally, the current levels of debt will crowd out private capital. If less capital is available for corporate borrowers, it will retard future growth and investment, and, eventually, reduce consumer spending power.
Decision making is all about prioritizing your opportunities. And it should be a genuine mix of policies that pay quickly and policies that bring long-term strategic opportunities.
I see the US working hard on the latter ‘secondary‘ areas that support long term export opportunities, such as health-care, education, immigration and energy policies.
That is probably the biggest challenge we all face during crisis, whether it’s a personal crisis or a global one: FEAR.
Governments all over the world will have to figure out how they are going to communicate the stability of their countries in a way that the citizens will understand and believe it. Government should show enough detail of the state financials so that firms and consumers know, beyond all doubt, that the country isn’t in ‘free fall’ and that customer spending is a safe bet. A president’s personal guarantee won’t be enough.
The job is to lift people’s heads, with policies that decrease the number of business failures and increase their odds of success. The job is to lessen the people’s fear. This is not the time for messages of high risk that emphasize inspiration, empowerment and innovation. It’s the time for messages of low risk like protection, security and stability.
If governments show how they will protect jobs and reduce structural unemployment… they’re 90 percent on the way to further recovery.
What would be the best realistic manufacturing policy?
I am thinking about:
Lower corporate taxes and force banks to restore small business credit quickly to trigger investments in efficient manufacturing technology.
But keep the environmental and labor regulations to ensure the health, safety and quality of life of the people. I can live with the government intentions to award federal contracts to companies that provide living wage, health care, retirement and paid sick leave and have fewer violations in labor and employment, tax, environment and antitrust.
“Develop a system of financial incentives: levy an extra tax on the product of off-shored labor [personal note: and on heavily polluting off-shored production?]. Keep that money separate. Deposit it in the coffers of what we might call the Scaling Bank of the U.S. and make these sums available to companies that will scale their American operations.” (Andrew Grove, co-founder and senior adviser to Intel Corp)
Bring better qualified, higher-skilled professionals inside manufacturing by restructuring immigration and starting to reform manufacturing education. The success of top-performing states – a Chamber of Commerce report points out – depends on their “ability to execute successful initiatives” in amongst others: basic education; “delivering adequate funding for initiatives; (…) enterprise-friendly tax and regulation systems; and vigorous collaboration between business, government and education.”
I believe a lot more is not possible under the current financial constraints and in the given four-year terms. The education reform will already take 10 to 15 years…
The Great Recession rolls on, but it’s not too early to single out the major powers that have come through the wreckage in the best shape. They are the ones the other major nations implore for help — to bail out weaker economies, to diminish their dominance of the world’s production and start consuming more themselves. There are just two such nations: China and Germany.
Germany and China don’t have a lot in common. Germany has a mature economy and is a stultifyingly stable democracy. China has a rising economy and remains disturbingly authoritarian. What sets them apart from the world’s other major powers, purely and simply, is manufacturing. Their predominantly industrial economies meet their own needs and those of other nations, and have made them flourish while others flounder.
Most Americans, I suspect, believe we’re losing manufacturing because we can’t compete against cheap Chinese labor. But Germany has remained a manufacturing giant notwithstanding the rise of East Asia, making high-end products with a workforce that is more unionized and better paid than ours.
Germany has increased its edge in world-class manufacturing even as we have squandered ours because its model of capitalism is superior to our own. For one thing, its financial sector serves the larger economy, not just itself. The typical German company has a long-term relationship with a single bank — and for the smaller manufacturers that are the backbone of the German economy, those relationships are likely with one of Germany’s 431 savings banks, each of them a local institution with a municipally appointed board, that shun capital markets and invest their depositors’ savings in upgrading local enterprises. By American banking standards, the savings banks are incredibly dull. But they didn’t lose money in the financial panic of 2008 and have financed an industrial sector that makes ours look anemic by comparison.
So even as Germany and China have been busily building, and selling us, high-speed trains, photovoltaic cells and lithium-ion batteries, we’ve spent the past decade, at the direction of our CEOs and bankers, shuttering 50,000 factories and springing credit-default swaps on an unsuspecting world.
Daily I talk about the problems in education and the resulting catastrophes manufacturing companies are facing in the near future. But many people have to act – not only teachers and school principals. Also enterprises must take significant and necessary steps to make sure the young perceive manufacturing as an interesting and rewarding career opportunity.
In comparison to other sectors, the manufacturing sector’s demographic profile is disproportionately composed of older workers and men. 38% of the workers is aged 40-54 year, compared to 31% in other sectors of the economy. More than others, manufacturing employers will experience a large-scale exodus of older workers in the forthcoming years. The aging of the Baby Boomer generation is likely to have a greater impact on the manufacturing sector than on other sectors.
The question is: how can enterprises attract the young workforce to counter the inevitable exit of the older workers?
The good news is that manufacturing is transforming today. Changes in technology, the use of robots, computers, programmable motion control devices, and various sensing technologies makes the industry evolve away from traditional assembly line systems towards “lean” manufacturing systems that use teams of workers to produce entire products or components, that rotate through different tasks, rather than specializing in a single task.
That means that production work in this sector can no longer rely on lower educated individuals who labor on repetitious low-skilled tasks. Machinists using machine tools such as lathes, milling machines, and grinders, to produce precision metal parts, in most of the cases produce small batches or one-of-a-kind items. They have to use their knowledge of the working properties of metals and their skill with machine tools to plan and carry out the operations needed to make machined products that meet precise specifications. More and more employees can enjoy creative work. That is the good news, which is a significant incentive to attract new and the very best talent.
The other good news is that – while manufacturing workers have significantly less autonomy and fewer opportunities to change their work arrangements in comparison to workers in other sectors of the economy – especially younger workers get more freedom in deciding how to perform their work and are included in decision-making activities. This evolution for sure enhances commitment and talent stability.
The bad news is that working in manufacturing tends to be tiringwork. Two in three middle-aged employees in the manufacturing sector – reported that they come home from work too tired to take care of their household chores at least several times a month.
More bad news is that in comparison to other sectors, workers in the manufacturing sector have less access to career progression and promotion programs and fewer options in terms of where, when, and how work is to be performed. All generations express a preference for access to flexible work options. That would increase business effectiveness and productivity. Likely, some rigidities stem from the imperatives of the production process, which can prohibit work off-site, work part-year, reduce work hours, choose work shift etcetera. But still…
On the other hand the authors of the report find evidence that enterprise size strongly predicts the availability of flexible options. One in four small manufacturers (those employing fewer than 100 workers) established flexible work options to a moderate or great extent, a rate that was two to three times higher than medium sized and large sized employers. For young people those small job shops look like the most promising career starts.
And a last – critical – observation is that manufacturers especially have difficulties in
recruiting competent job applicants,
finding new employees with satisfying operations skills levels,
absenteeism,
morale,
finding employees skilled in management,
legal skills
and sales/marketing skills.
Teachers of technical schools and parents are the people that can make the change in these skills and attitudes happen.
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The manufacturing sector appears to be at a competitive disadvantage without education that leads the world, without redesigned human resource practices to the expansion of flexible work options, and without forward-looking employers…
According to a new report access to talent that supports innovation is the key factor driving global manufacturing competitiveness, well ahead of traditional factors such as cost of labor and materials and energy policies.
The quality and availability of skilled production workers, scientists, researchers, engineers, and teachers, who collectively have the capacity to continuously innovate and improve production efficiency, is the most significant driver of manufacturing competitiveness, the report says.
Talented people are giving companies the greatest potential for making a company innovative and for improving the overall competitiveness of the country. The capacity of a country thus largely depends on the quality of its education and training.
The quality of talented people is driving manufacturing innovation. Coupled with the costs of labor and materials and the costs of energy, these three are the “foundations” of manufacturing competitiveness.
After the key factors of production – labor, materials and energy – government forces have the most significant impact on manufacturing. These include environmental, institutional and infrastructural elements.
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It is interesting to see the differences across continents:
Talent-driven innovation is the top driver of manufacturing competitiveness across global regions. The exception is Mexico and South America, where executives rate the quality of thephysical infrastructure (roads, ports, electricity grids, telecom) as the most important.
European executives view energy costs and policies as the second most important driver. The European Union faces serious challenges concerning security of supply as the dependence of several member states on one single gas suppliers (Russia) makes the continent very vulnerable for shortfalls in supply and energy crises. So clearly manufacturers in Europe see the availability of cost-effective alternative energy as key to competitiveness and the springboard to leapfrog competing regions of the world. However a common energy policy in Europe is very controversial as many nations see access and sources of energy supply as too critical to national security and should remain under the control of member nations.
In the US between 50 and 60% of the respondents considered major current policy trends as very disadvantageous: (1) the bail outs that hinders competition and does not benefit business over the long term, (2) the corporate taxes making US manufacturers pay 18% more on taxes, natural gas, employee benefits and pollution abatement than a foreign competitor making a similar product, and (3) the increasing costs of healthcare that will stifle manufacturers’ ability to grow and create jobs.
In China on the other hand the lack of access to healthcare and insurance is seen as very disadvantageous, as that is a major contributor to poverty in China. Low levels of insurance coverage have resulted in high savings rates and reduced consumption – key determinants of economic growth. China’s leaders recognize that they need to improve the equity and efficiency of the healthcare system, which plays a critical role in the economy.
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Overall the study concludes that difficulties in accessing an empowered talent base are likely to contribute to the United States and Europe becoming less globally competitive in the next five years.
…Time to act towards attractive, inspiring and advanced manufacturing education…
The Alliance for American Manufacturing (AAM) interviewed a wide range of individuals from professionals in the field, students, professors, think tank scholars, etc.
The video is geared to a variety of audiences including but not limited to student groups, faith-based groups, environmentalists, policy makers, retirees and general interest groups.
Consensus among 23 manufacturing and support entities show that sales are up, some as much as 30% from last year.
How these companies have done it:
Focused on building new customer relationships, especially out side of the region or outside of their usually industry sector. Some companies that are being successful have aggressively pursued a global opportunity (>> Aggressiveness, expanding the scale of business and reaching and winning new customers is the key to business growth.)
Tightening up processes (>> People can only deliver better quality, if system failures such as organization, market analysis, management, equipment, workplace productivity and procedures are tackled.)
Partnered with other companies or entities that support manufacturing to market, train, access their processes etc. (>> You cannot take on the world all by yourself. No company is an island. Working with alliances, drawing on the competences of other firms to compete more effectively is critical to win on a global base.)
Tax council (>> One of the central government roles -in my view- is ensuring an adequate flow of information to companies and consumers. Today companies can use all possible help to make safe and informed financial decisions e.g. via tax education.)
Educating employees (>> The Only Sustainable Competitive Advantage: Learning; 50% of growth in BNP is explained by better educated workers and managers; A strong economy is rooted in a superb education system: you can have the best ideas and the biggest pile of money, without the right people, you will not make it.)
Changing their culture to a LEAN culture (>> Maintaining a culture of loyalty and hard work, going back to the basics, put the facts on the table, make everyone feel we can solve problems together, teamwork with inspirational leadership – towards improved and much leaner efficiencies. That’s how Alan Mulally got Ford fixed up.)
Another source called Chiefexecutive.net sees some other competitive strategies:
High-tech, sophisticated, highly automated manufacturing, including extensive use of powerful robots
Tight integration between engineers and designers (product R&D) to create top-quality, integer technologies
Finding suppliers close to home, shortening supply chains => be closer to customers, serve them with speed and quality, improve lead-time capabilities, diminish delays, lower freight costs, have more stable prices, avoid “green” taxes and bad reputations…
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Dear reader: do you know about more winning strategies?
With the Indian economy predicted to grow by 7.5 percent this year, CNN reports that it could be time for Western CEOs to learn some lessons from their Indian counterparts.
Based on interviews with leaders and HR departments from 98 of India’s 150 biggest companies, Peter Cappelli identified some of the key differences between Indian and Western bosses.
“One of the most important things is that Indian leaders lead with a sense of social purpose,” Cappelli told CNN.
Our Western companies usually add social accents in their missions. But, few US consumers can immediately mention a socially responsible US corporation.
In India, however, CSR (Corporate Social Responsibility) is an integral part of the business strategies, the companies really have a social mission and it is often a source of cash.
Cappelli said every Indian leader interviewed gave a specific social purpose as being the goal of their business. Those purposes ranged from improving health care in India, to getting cell phones to people who don’t have access to communication tools, and proving to the international community that Indian companies can lead in IT.
The reason is simple: companies can only flourish if the people in the country enjoy a good quality of life and if there is permanent investment in education.
CSR may not only be vital to get government licenses, but it proves to be essential for the reputation of every company, be it Indian or American or European. 75% of all people “are willing to pay more for products from socially responsible companies.”
>> So isn’t it time for all manufacturing companies in the Western continents to invest in their local technical schools? To at least address the critical shortage of young people entering the industry? To save money in the long run by having a source of highly (re)trained employees, without having to hunt/steal skilled employees from other companies, at a huge inefficient wage cost?
Having and communicating a trustworthy consistent citizenship message seems to be of greater importance among consumers than product quality or value…
AT LAST! Major media is finally portraying today’s manufacturing careers correctly!
CNN’s Tony Harris reports on the new high-tech jobs taking the place of old-style manufacturing. He has seen the company ADEX Machining Technologies in South Carolina USA from the inside, making metal parts for the aerospace and energy industries, via CNC programming and CNC machining.
The employees here, the video shows, spend as much time in the office as on the shop floor. They don’t just push the buttons of the machines, they also program the machines using CAM computer systems. Each worker is a highly competent programmer, machinist ànd quality control engineer. What typically was three different jobs, is now wrapped into one… That is what is called “lean manufacturing“.
And exactly THAT is extremely satisfying and empowering for the workers: “We take what is on paper and we can bring it to life“.
Using their computers to tell the machine where to drill holes in the piece of metal, going to the factory floor and actually making it happen, while still stimulating their brains… that is what the workers love about their modern high-tech manufacturing job.
This “New Face of Blue Collar Workers” is commonplace for the people who know today’s manufacturing companies.
But I’m 100% sure that the CNN video is highly revealing to the general public and goes a long way in dispelling the old stereotype of manufacturing.
>> CLICK HERE TO SEE THE CNN VIDEO FOR YOURSELF <<
Last Friday New York Times, elaborated on one of the crucial aspects: workforce education.
My point of investing in education for more skilled workers (as a crucial competitive advantage as our high labor costs are directly linked with insufficient focus on manufacturing education) is being supported:
China is facing an increasingly acute labor shortage. The country is running out of fresh laborers for its factories. A government survey three years ago of 2,749 villages in 17 provinces found that in 74 percent of them, there was no one left behind who was fit to go work in city factories — the labor pool was dry.
Some manufacturers, already weeks behind schedule because they can’t find enough workers, are closing down production lines and considering raising prices.
Unskilled factory workers in China’s industrial heartland are being offered signing bonuses. Factory wages have risen as much as 20 percent in recent months, giving Chinese families more spending power (probably manufacturing industry wages could double in the next five years).
However, rising wages could lead to greater inflation in China, eroding some of China’s formidable advantage in export markets. The prospect of rising wages suggests that companies with high labor costs could experience margin pressure. Such increases would most likely drive up the prices for all sorts of Chinese-made goods, to import in the United States and the European Union.
This reality of Chinese talent shortage a.o. will re-shore manufacturing back to the western world, according to Mike Collins, Author, Saving American Manufacturing:
Chinese manufacturers have trouble in guaranteeing their US and European customers accurate delivery dates because of unforeseen delays in the supply chain;
Chinese manufacturers will have more difficulties to make quick changes in the manufacturing process – Without a strong workforce, it will be harder for them to quickly customize products.
The risks involved with a supplier in China get bigger. Western manufacturers have begun to pull their supply chains back closer to their markets, closer to their customers – which are asking for custom-made solutions and just in time delivery.
Harry Moser, chairman emeritus at Agie Charmilles points to the “costs of regulatory compliance, potential intellectual property loss, visits to overseas vendors, potential product quality problems, high foreign wage inflation and carrying extra inventory as cushion against late or damaged shipments.” (industryweek.com)
Challenges in manufacturing offshore are legion, Brian Bethune – a chief U.S. financial economist – said. Infrastructure can be undependable, including frequent electrical brownouts in some regions of China. Manufacturing is often plagued by quality problems, rendering products unfit to sell in more sophisticated markets. Language and cultural barriers pose difficulties. Negotiating governmental expectations and hurdles, especially in China, is a huge issue. (Tennessean.com)
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China might be less competitive in the coming years; however, and that doesn’t surprise me at all: the Chinese government is rapidly reacting, with expanded postsecondary education. Universities and other institutions of higher learning enrolled 6.4 million new students last year, compared to 5.7 million in 2007 and just 2.2 million in 2000.
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This reality of Chinese talent shortage will re-shore manufacturing back to the western world:
·Chinese manufacturers have trouble in guaranteeing their US and European customers accurate delivery dates because of unforeseen delays in the supply chain;
·Chinese manufacturers will have more difficulties to make quick changes in the manufacturing process – It will be harder for them to quickly customize products, without a strong workforce.
·The risks involved with a supplier in China get bigger. Western manufacturers have begun to pull their supply chains back closer to their markets, closer to their customers – which are asking for custom designed solutions and just in time delivery.
Students from Finland outperform peers in 43 other nations – including the United States, Germany and Japan – in mathematics, science and reading skills. Finland is also ranked top in economic competitiveness.
Explaining the excellence of the schools in Finland is extremely complex. They have beautiful school buildings, well-trained teachers, state-of-the-art technology any fancy textbooks, but that doesn’t explain everything. I will not present an exhaustive or exclusive explanation for Finland’s success, but 10 CHARACTERISTICS MAY BE HELPFUL TO UNDERSTAND:
(1) When Finnish kids turn 7 years old they go into compulsory primary school during nine years. All kids start at the same level, no matter what socio-economic background they have. They learn the basic knowledge, skills and attitudes of lifelong learning, which is consistently paying off with better academic achievement in later grades. These primary schools are places where playing and learning are combined with alternative pedagogic approaches, rather than mere instructional institutions.
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(2) All teachers are prepared in academic universities. Teachers are highly respected and appreciated in Finland, partly because all teachers need a master’s degree to qualify for a permanent job. And the selection is tough: only 10% of the 5000 applicants each year are accepted to the faculties of education in Finnish universities. Finland improved its public education system not by privatizing its schools or constantly testing its students, but by strengthening the education profession and investing in teacher preparation and support. Their high level knowledge and skills makes that Finnish teachers
can have considerable independence in the classroom to choose their preferred appropriate pedagogical methods;
are very willing to continuously update their professional skills via post-graduate studies;
are more willing to work on themselves, are open to new ideas and developed broader perspectives (I refer slightly to the article: MBAs Make Better CEOs… But Why?);
are eager to be involved into the school development processes in their own schools as well as in national and international projects.
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(3) Since the 1960s political authorities always have seen education as the key to survive and thrive in an increasingly competitive world. All governments, from left to right have respected over the past 4 decades, that economic growth is the primary goal, with education as the critical driver (according to some researchers, education explains 25% of Finland’s growth): “Investment in people is the best investment”. To be competitive, the governments concluded, Finland has to substantially boost investments in education and research to foster innovation and cutting-edge development.
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(4) Because the central government ensured sustainable funding to ensure FREE education for all, i.e. took care of ALL costs of tuition, warm school meals, learning materials, text books, transportation, new equipment, new facilities, student counseling, etc, the teachers are able to focus on teaching and learning, and bringing new ideas and practices in schools.
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(5) There are no mandatory tests or exams; except for the nationwide National Matriculation Examination, in mother tongue, foreign language, mathematics and social/natural sciences, at the end of the upper-secondary school (from 17-19-year-old). Teachers make their own assessment tests, not quoting numeric grades, but using descriptive feedback, no longer comparing students with one another. This helped teachers and students focusing on learning in a fear-free environment, in which creativity and risk-taking are encouraged. Teachers have more real freedom in time planning when they do not need have to focus on annual tests or exams.
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(6)Trusting the schools and teachers is a common feature in Finnish schools. Schools receive full autonomy in developing the daily delivery of education services. The ministry of education always believed that teachers, together with principals, parents and their communities know how to provide the best possible education for their children and youth. Except for guidelines for learning goals and assessment criteria, The National Board of Education (taking care of curriculum development, evaluation of education and professional support for teachers) doesn’t dictate lesson plans or standardized tests. School can plan their own curricula to reflect local concerns.
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(7)For Manufacturing Education: In higher education, Finland offers university level studies or the polytechnics insitutions. The polytechnic system was the focal point of education policies in Finland during the 1990s and the top priority for regional development. There is a wide consensus on increasing technology, environmental sciences and entrepreneurship education – all of which seem to contribute positively to economic development and growth. As a result regional support networks are developed to help schools and teachers to adopt new technology in education and incorporate technology into classrooms.
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(8)Building upon the expertise of local players, whose experience, opinions and abilities allowed them to indicate the best ways forward. The teacher unions and the educators themselves have always had the opportunity to be heard, to help crafting a blueprint of the reforms.
The key to get their commitment and support was tapping into and welcoming their expertise as professionals in laying the groundwork of reform. Expert committees of teachers, union representatives, university researchers, textbook authors and government officials designed the new frameworks, hashing out their differences and using each other’s valuable and varied expertise.
Another key was reassuring teachers would not lose employment security and salaries. Before the reforms even commenced the teacher trade organization achieved this in negotiating higher teacher compensation for the extra more demanding work.
Also experiments and pilot programs in developing curriculum reforms have helped ease concerns and win the teachers’ professional commitment. All experimental projects, coming from bottom-up as well, were monitored by university researchers, bringing a consistent culture of innovation in the Finnish education system.
Education reform could only have proceeded if it gave the teachers a way to maintain their pedagogical freedom, creativity and sense of professional responsibility, by allowing them to choose textbooks and learning materials, and to determine the best way to cover the curriculum.
The execution of new curricula, learning materials and new instructional methods was always carefully planned, province by province. Provincial Offices approved the plans from every municipality. The switch to a new reform was also guided by in-service training by a network of national level instructors.
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(9)Political consensus and the capacity of policy makers to pursue reform: governments, trade unions and employers’ organizations form a tripartite in Finland, closely coordinating, communicating and heading to a common goal. In many countries the opposing-parties usually polarize debates and public opinion. Since the beginning of the 1970s until 1987 the ministry of education had two ministers from the main parties, requiring close political cooperation, resulting in workable solutions as both parties could endorse them. This proved to be the key factor behind the continuity of Finnish education policy. The parties detached from their populist political objectives and strategic maneuvers and began focusing on the subject-matter, on cooperating and acting together.
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Via the close partnership between the labor organizations and the governments, between the employees and the employers, in both planning and implementation stages, the teacher union changed from external political pressure group intoa stakeholder in government decision-making, i.e. into one encompassing labor organization, that looks at the interest of the COMPLETE SOCIETY, just like the government. This key element in good quality of governance and public institutions turned out to be the driving force of education performance and economic competitiveness in Finland.
(10)Regional development and networking: Today the most important component of providing good education is the management and leadership skills of local political authorities, experts and school principals (carefully selected for their understanding of education development, their experience in teacher-education and their solid proven management skills). The key in the educational reforms was ‘how to find ways to help schools and teachers come together and share what they have learned about productive teaching techniques and effective schools’. The result was the creation of multi-level, professional learning communitiesof schools sharing locally tested practices and enriching ideas, and matching the needs for local economic development.
First, I shortly describe the 4 scenarios and its implications for education.
Second, I reflect on the scenario I see Europe following today, 7 years after the release of the report.
SCENARIO 1: The European Union doesn’t get stronger, large multinationals shape international trade, consumers don’t care much about environmental impacts of production and consumption. Energy efficiency in production improves only because of strategies of company cost reduction. There are no incentives for radical changes.
>> In EDUCATION, due to the lack of government commitment, more and more private initiatives will pop up, focusing on excellence in education.
Reflection: The European Union is weak and will probably always be weak. The creation of the EU presidency post following the Lisbon Treaty was great. But Europe will never be unified as a transnational entity: too many cultural and historical differences, too many national minorities, all protecting their own interests. Guy Verhofstadt, president of the European Liberals ELDR recently wrote that the future of Europe doesn’t lie in the juxtaposition of national identities. “That would be a Europe that is incapable of solving problems,” Verhofstadt says, “that would be a Europe that can’t play a significant role in the multi-polar world of the 21st century.”
>> This means that private initiatives in EDUCATIONwill be crucial to raise the quality and attractiveness of manufacturing education.
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SCENARIO 2: Regional governments take over and determine policy priorities. Strict environmental regulations lead to a concentration of manufacturing activities in creative regional clusters that work with radical new manufacturing approaches and alternative energy systems for cleaner production. But there is little trans-regional coordination of policies.
>> In EDUCATIONregional government bodies will work closely with industry and associations in training initiatives.
Reflection: Building regional innovative clusters is probably the right way forward. Economic growth and economic business is generated by autonomous regions, not by nations. In my view, the source of prosperity is always REGIONAL, e.g. Hong Kong/Shenzhen, Singapore/Johore/Batam, Taiwan/Fujian, South China, South India (Bangalore), Northern Mexico, North West coast of US (Silicon Valley), Eindhoven Netherlands for the ICT industry, North Rhine-Westphalia & Bavaria Germany for chips, Cambridge UK for Mechanical engineering, Northern Italy for Valves. [Related: the pledge from Mitch Free (CEO at MFG.com) for regional Special Economic Zones (SEZs) with reduced tax burdens, streamlined bureaucracy and administrative requirements]
>> BUT the weakness of the whole system isEDUCATION, i.e. the supply of human resources. You can have the right ideas, work hard, take initiatives, bring together governments, professors, companies, students & financiers to make new companies happen, you can have lots of money, but without the right people with the right skills and with the right tools you will not make it. A strong economy is routed in a strong educational system.
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SCENARIO 3: Global governance emerges, that promotes sustainability . The European Union defines and implements clear sustainability policies, with energy taxes, emission charges, strict regulations and financial incentives. Governments watch the designing and implementing of new technologies closely. Major technological breakthroughs result in more environmental production with renewable materials.
>> In EDUCATION governments retain the lead role, emphasizing interdisciplinary training, soft skills and problem solving capabilities. This scenario requires a highly qualified labor force with new skills to operate and manage sustainable production systems.
Reflection: The global governance is the ideal scenario for sustainability of our planet. But as said in Scenario 1: I doubt if Europe will ever speak with a unified voice. Moreover, the Copenhagen Climate Conference in December 2009 has shown us how difficult it is to unlock a global collective action.
>> On the other hand,TRAINING in interdisciplinary skills will become more important as the manufacturing industry will be completely reinvented by online communities, asking for highly customized products and smart, creative, innovative thinkers that will set up completely new client-centered business models to better meet the needs of increasingly demanding customers. [One of my posts that is linked with this: “The Small Batch Movement“]
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SCENARIO 4: Europe establishes a strong industrial policy, but there is little willingness of China and India to include environmental and social concerns in their production. There are incentives for industry to invest in sustainable manufacturing solutions, but they run along existing application trajectories.
>> In EDUCATIONthere will be a EU-wide training certification system, coordinating public and private training schemes focusing in excellence in education.
Reflection: Europe that is focused on itself is PROBABLY WHAT IS HAPPENING NOW. East Asia is a huge competitive problem. So Europe will try to push innovationin high quality technologies that use new eco-friendly materials and product designs. That will create new export opportunities for companies. But – unfortunately – I don’t expect radical shifts in European manufacturing.
>> Although in EDUCATIONa EU-wide training certification system is a very interesting track to bring together all public and private education initiatives and could set the world-wide standard for manufacturing training.
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Dear READER: >> Do you think of other scenarios? Or do you have different reflections?
Detroit-area auto suppliers are differentiating and rolling in new business. At least 100 auto suppliers already have secured contracts in other industries and that at least 250 have bid for work.
The machine tool and parts company W Industries, once an exclusive supplier to the auto industry, is now:
Making heavy steel parts for the frames, bodies and gun mounts of Humvees and Stryker combat vehicles destined for Afghanistan and Iraq. (see CHART expected growth in defense)
Testing the Orion space module by simulating the violent vibrations of liftoff. The NASA Orion space program aims to send human explorers to the moon by 2020 and then to Mars and beyond. (see CHART expected growth in aerospace)
Finishing a steel mold that will be used to make 70-foot-long roof sections of Airbus A350 passenger jets.
Race-car engine developer McLaren Performance Technologies is now making components for thousands of SunCatcher solar dishes, and is helping to design and build the motorized units that will convert concentrated sunlight into electricity. (See CHART expected growth in energy & resources)
Dowding Industries, a tool-and-die shop for Oldsmobile in 1965, later expanded into metal auto parts, tractor and rail car parts. In 2006, the company started to develop better-performing tools for plane makers and wind turbine components, in one-fifth the time of current methods. The carbon-composite blades will be 30 percent lighter than fiberglass blades and last 20 years or longer. (See article: the challenges of manufacturing wind turbines). Dowding sees opportunities to use similar technologies for bridges, expressways and ships.
Upcoming products in Michigan include remotely piloted military aircraft, lithium-ion batteries (Johnson Controls), the next-generation wind turbines (General Electric), a Boeing, Airbus and Bombardier engineering center, solar panels and battery systems for utilities.
What makes this shift possible?
The standard of manufacturing in the automotive industry is extraordinarily high in Detroit, and that is the only place you can find such a concentration of skills, for R&D, pilot projects and early-stage production.
The main allure of the Detroit area is its ability to quickly turn designs and prototypes into real workable products, that are more efficient, less expensive and easier to mass-produce.
The region is the country’s premier precision manufacturing base, with tens of thousands of highly skilled, underemployed mechanical engineers, machinists and factory managers. “We have the best manufacturing resources on the planet here in Michigan,” says Chris Long, the founder and chief executive of Global Wind Systems. “We just need to get aligned.”
A BIG question is whether the new work will sustain Detroit’s manufacturing ecosystem if auto assembly keeps migrating elsewhere. As suppliers close, more managers and engineers could move away.
To illustrate how difficult that manufacturing talent would be to replace, Bud Kimmel, vice president for business development at W Industries, points out to 30-year-old machining whiz Jason Sobieck.
“Jason is like an artist,” Mr. Kimmel says. “We built our whole program around him. Jason began work at 17 at a small Detroit welding shop. He then worked for tooling companies, where he learned to program automated systems and manage projects. “These skills really aren’t taught in school,” Mr. Sobieck says, “This is a trade you learn on the shop floor.”
That’s one reason that W Industries wants to snap up as many good machinists and engineers as it can afford.
“If we don’t re-engage the automotive workers soon in major programs,” Mr. Kimmel says, “this set of skills will be lost.”
With the unemployment rate in the United States lingering just below 10 percent and the midterm elections just nine months away, job creation has become the top priority in Washington.
President Obama has called for transferring $30 billion in repaid bank bailout money to a small-business lending fund, saying, “Jobs will be our number one focus in 2010, and we’re going to start where most new jobs do: with small business.”
The fund is among several measures—such as tax incentives, infrastructure projects, and efforts to increase exports—that the White House has proposed to help boost employment. As Americans consider the various approaches, we must have realistic expectations.
We need to debunk some myths about what it takes to stimulate job growth.
MYTH 1: Surely there’s a quick fix.[AGREE]
Oh, were that only the case. The scale of the challenge is enormous. Quick action is important, but remember that the US economy has lost more than 7 million jobs in the past two years. The country would need to create more than 200,000 net new jobs each month for the next seven years to get unemployment back to what was once considered a normal 5 percent. Quick fixes focused on 2010 alone won’t be enough. Of course, the right mix of government policies can help. But even if Obama’s proposals were enacted right away and they accomplished all that he hopes, they would at best represent a good start. America’s jobs challenge is a multiyear marathon, not a sprint.
MYTH 2: The key to boosting employment quickly is to help small businesses.[NOT SURE]
New jobs come from both small and big businesses. From 1987 through 2005, nearly a third of net new jobs were created by businesses that each employed more than 500 workers. By 2005, these big companies accounted for about half of the country’s total employment, although they made up less than 1 percent of all US firms. But a look at the past two economic booms shows that the pace of job creation depends on more than the size of the businesses. During the economic expansion of the 1990s, large US multinational corporations—which employ an average of about 1,000 workers each in the United States—created jobs more rapidly than other companies. This was because they dominated computer and electronics manufacturing, the sector that drove much of that boom. During the more recent expansion of 2002–07, most of the net new jobs came from local service sectors, such as health care, construction, and real estate—which comprise both large and small businesses.
MYTH 3: High-tech jobs will solve the problem. [AGREE]
There is a lot of talk these days about green businesses, biotechnology, and other emerging industries that will create the jobs of the future. While they are obviously part of the solution, these industries are too small to create the millions of jobs that are needed right away. The semiconductor and biotech industries, for instance, each employ less than one-half of 1 percent of US workers; clean-technology workers, such as those who design and make wind turbines and solar panels, account for 0.6 percent of the workforce.
We’ll be able to generate significant numbers of new jobs only by spurring broad-based job growth across the economy, particularly in big sectors such as retail, wholesale, business services, and health care. High-tech innovations will help employment grow over the long term, as new technology spreads throughout the economy and transforms other, larger sectors. For example, while the semiconductor industry alone doesn’t account for much US employment, the computer revolution has fueled the growth of other industries such as retail and finance; similarly, the clean-technology business by itself doesn’t employ many people, but its developments could transform a big sector such as energy, creating new business models and new jobs.
MYTH 4: Higher productivity (when an economy produces more goods and services per worker) kills jobs.[AGREE]
Not so. While productivity growth means that individual companies may need fewer employees in the short term, it spurs long-term gains in the economy as a whole. Since the industrial revolution, increasing worker productivity has brought rising incomes, higher profits, and lower prices. These forces stimulate demand for consumer goods and services and for new plants and equipment—fostering, in turn, industry expansion and job creation. Take cell phones. Even 15 years ago, they were big, unwieldy, expensive, and worked only in limited coverage areas. But as new technologies enabled workers to produce phones and provide service more cheaply, the industry took off. Cell phones are now ubiquitous, and this has created jobs not just among phone makers but also among retailers, service providers, and a new industry of developing and selling applications for smart phones.
MYTH 5: Increasing exports will revive manufacturing employment.[DON’T AGREE, Let’s comment on this readers!]
Maybe for some companies in some industries, but not for the economy overall. While it’s painful to accept, reducing unemployment is not mainly about regaining the jobs that have been lost. Sure, rising exports will cause some factories to scale up again, and many laid-off workers will be called back. But most new job growth will come from other sectors. History shows that recessions—particularly those that follow a financial crisis—accelerate the growth or decline already underway in industries. In this recession, for example, the auto, financial-services, and residential-real-estate industries have contracted significantly and won’t regain their peak employment anytime soon.
An increase in exports may stem—but will not reverse—the multidecade decline in manufacturing employment. In today’s developed economies, >> NET GROWTH IN NEW JOBS DOESN’T COME FROM MANUFACTURING; IT COMES FROM SERVICE INDUSTRIES. << (REALLY?????) Fortunately, boosting exports creates jobs in supporting service industries, such as design, trucking, shipping, and logistics.
The future of American manufacturing lies in the power of the internet and the power of micro-factories, according to Chris Anderson, editor in chief of Wired in his article “In the Next Industrial Revolution, Atoms Are the New Bits”.
Chris Anderson describes a couple of practical examples of Jeremy Rifkin’s concept of the Third Industrial Revolution.
The coming together of coal, steam power technology and the print press technology gave birth to the First Industrial Revolution.
The Second Industrial Revolution combined oil, combustion engines, with the rapid developments in electronics such as the telegraph/telex, telephone, radio, television, electric typewriters, calculators, computers and the electrification of machinery.
Now, Rifkin states, we are in the Third Industrial Revolution. Only now we are able to use the full force of the internet, mobile computing, wireless communication technologies from the 1990’s, in our manufacturing industry.
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An example from Wired: the design of the Rally Fighter, a $50,000 off- racer is crowdsourced: an online community of 5,000 members crafted the exterior and selected the off-the-shelf components. The customers themselves assemble the cars at their homes or in local assembly centers as part of a “build experience”. Their fantasy car comes to life.
That is the power of internet, that is the power of common platforms, easy-to-use tools, web-based collaboration, peer production, open source, user-generated content and Internet distribution.
Crowdsourcing is powerful model, says Springwise.com, “it’s effectively free outsourcing that creates products the market wants, and fosters an intimate relationship between consumers and brands“.
Only now we are seeing the full reach of the online web. The manufacturing industry will be completely reinvented. The Third Industrial Revolution hits the real world. One-person enterprises can get things made in a factory the way only big companies could before. Small manufacturers are the key…
Smart, creative people with an idea and a little expertise can set flexible and custom-made assembly lines in China into motion with nothing more than some keystrokes on their laptop. Ideas go straight into production, no tooling required.
A few days later, a prototype will be at their door, and once it all checks out, they can push a few more buttons and be in full production, making hundreds, thousands, or more.
They can become a virtual micro-factory, able to design and sell goods without leasing a huge warehouse and having to outfit it with assembly lines, forklift loaders, and other heavy equipment.
It’s all about IDEAS. “The production,” the director of the Belgian Roularta Media Group Alfons Calders said, “can move to China, they have the engineers to put our ideas in practice. Self-confidence, instead of panic, will be the challenge of future innovative thinking.”
Blogger Jason Kottke calls it the “small batch movement”, that refers to businesses focused more on the quality of their products than the size of the market. They’d rather do something they were passionate about than go mass. Thomas L. Friedman uses the words “Cloud Manufacturing“.
These companies are small, virtual, informal, global and high tech. They form and re-form on the fly, search for the best abilities and the best people. The long-term result is that manufacturing production will increasingly shift toward smaller businesses and entrepreneurs.
Together they will take on the big manufacturing companies. Analysts expect almost all new manufacturing jobs in the US will come from those very small micro-companies.
“Closing the gap between where manufacturers are today and where they need to be to succeed in the years to come is a challenge — but it’s not too late. American manufacturers still have an advantage in leadership, innovation and support infrastructure, among others.”
“The solution is not to shift away from manufacturing, but to transform our manufacturingbase into a faster, more flexible industry capable of capturing global market share“.
Peter Adriaens, a University of Michigan entrepreneurship professor says “There is virtually nothing we can do to keep large-scale production here.” The jobs of the future will be done in small batches and highly customized. (nytimes.com)
According to Harry Moser, chairman emeritus at Agie Charmilles, “reshoring is more attractive for the production of new high-mix/low-volume parts and components, that require frequent engineering changes.” (industryweek.com)
The company Local Motors manufacturing the Rally Fighter says it can take a new vehicle from sketch to market in 18 months, about the time it takes Detroit to change the specs on some door trim.
A European Manufacturing report from 2003 already said that global competition will put pressure on European industry to provide new products and services individually customer-tailored and based on cutting edge technology with higher quality, distinctive features, better prices and feed back loops between customer and design processes.
The 2003 European report adds that the manufacturing sector will seek staff who are able to capture feedback from users, suppliers and external knowledge sources, who can work in flexible environments and collaborate in multi-disciplinary teams.
As such there will be a pressing NEED FOR NEW COURSES AT SCHOOL FOR NEW TECHNOLOGICAL AND BUSINESS COMPETENCES and for a new focus on training and interdisciplinary and knowledge management for manufacturing companies to remain competitive.
Wind power is the cheapest and most popular type of regenerative energy. As a result, manufacturers all over the world are scrambling to build gearboxes, generators, blades, power systems, motors, control systems and other types of electromechanical devices.
How does a wind turbine work?
Wind power works by harnessing the breeze that passes over the rotor blades of a wind turbine and rotates a hub. The hub is connected to a gearbox via low-speed and high-speed shafts that drive a generator contained within a nacelle. A generator converts the energy into electricity and then transmits it to a power grid.
The typical wind turbine is a slender structure that consists of a three-bladed rotor that extends up to 300 feet in diameter attached to the top of tall towers that soar hundreds of feet into the air. A yaw mechanism uses electrical motors to turn the nacelle with the rotor against the wind. An electronic controller senses the wind direction using a wind vane.
How is a wind turbine made?
The average wind turbine contains up to 8,000 parts that must be assembled. Towers and rotors are the largest and most basic components.
Most wind turbines are designed for a 20-year life cycle. The gearbox and drivetrain system must be strong enough to handle frequent changes in torque caused by changes in wind speed. Bearings are extremely critical. The whole system must be correctly aligned to minimize wear from vibration and any resulting noise.
One thing that differentiates wind turbine manufacturing from other industries is sheer size. All components, such as bearings, gears and generators, must be extra large and extra strong. Big parts and big plants are common in the industry. For instance, the typical gearbox weighs around 30,000 pounds.
Due to their size and weight, gearboxes are often moved through assembly steps at plants in Germany using large rail systems similar to those in automotive plants. Quality expectations in the industry are huge, because manufacturers demand reliability and low maintenance. Wind turbines don’t make money if they’re not working.
Towers typically consist of large tubular structures. Plated steel sheets are rolled into rings and joined together with submerged arc welding. The tower sections are typically fabricated into cans about 20 meter long and then bolted together through internal flanges. This is an industry that needs to build large, high-capital items in a production line manner. It may be compared to aerospace.
There is great potential for advanced robotic welding to be developed. On the other hand, rotor blade manufacturing from fiberglass and other composite materials tends to be the most innovative and highly secretive area of the wind turbine industry. Blades over 70 meters long are now being designed. To achieve low-cost mass production, automated solutions from aerospace or automotive, such as robotic tape layers, have to be used to join long lengths of blade to assure aerodynamic conformance.
What are the challenges facing manufacturing wind turbines?
Wind technology will need to evolve. Engineers need to make wind turbines larger, taller, less expensive, more reliable and more efficient. Because wind turbine components undergo excessive forces and a tremendous amount of joint stresses and failures, numerous manufacturing issues must be addressed.
It looks very graceful and simple, but the aerodynamics, power characteristics, vibrations, system fatigue, acoustics of a wind turbine are harder to understand than an airplane or a helicopter.
For instance, blades, towers and casings must be able to withstand heat, cold, rain, ice and abuse from changing wind speeds. Blades must also be built with a high strength-to-weight ratio, so research into new materials is key.
Making wind energy practical is a matter of maximizing efficiency and minimizing production cost.
Reliability is critical in the wind turbine industry. The most difficult application is the gearbox, because it is important to avoid any distortion. The challenge is to maintain clamp loads for the service life of the turbine. Manufacturers are looking at weight reduction and improved assembly of threaded joints.”
Close tolerances, the ability of components to withstand operation in difficult conditions, and the availability of quality materials are all important challenges facing engineers. It is also a challenge to develop parts that are light-weight enough so that the final system can be assembled more easily, but they must also be durable enough to withstand difficult operating conditions.
And finally: the industry is struggling to build a local supply chain. The availability of a steady and sufficient supply of locally sourced components is important, as turbine companies increasingly develop production facilities away from their home base, they need to be able to have access to enough quality components to build the systems at their new location.”
Manufacturing companies were asked to describe the current availability of qualified workers in specified workforce segments:
32% reports moderate to serious shortages today.
38% of all respondents foresee increased shortages ahead, especially in the manufacturing sectors Aerospace & Defense, in Energy & Resources and in Life Sciences & Medical Services.
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(Example: the biomedical industry is thriving well despite the recession (although it faces unprecedented challenges due to a.o. the educational funding crisis.
The fastest-growing occupation—with a 72% growth — is biomedical engineer. Biomedical engineers help develop the equipment and devices that improve or enable the preservation of health. They’re working to develop tomorrow’s MRI machines, asthma inhalers, and artificial hearts.)
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The main shortage will not be seen in unskilled labor, but in skilled production, such as machinists, operators, craft workers, distributors and technicians. 51% (!!) reports serious shortages today, the vast majority of whom see increased shortages ahead.
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Boeing– one of the US’s biggest manufacturers and exporters – said that by 2015, 40% of the aircraft maker’s workers reach retirement age. “That’s some 60,000 employees eligible to retire in five years. We just don’t see the recruitment pipeline meeting our needs.”
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About 19% of US manufacturing workers are 54 and older, according to the Bureau of Labor Statistics. However, only 7% of manufacturing workers are under 25 years old.
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“It’s difficult to find people for assembly, machining and motor-winding positions – jobs that require maths skills and the ability to read technical blueprints,” said Ron Bullock, owner of Bison Gear.
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Workers are delaying their retirement because of the financial crisis. But, as the economy recovers, a large number of skilled workers will leave. “As we go through the recovery, the situation will get worse,” said Lisa Simeon, a director of the US industrial conglomerate, “and restrict companies’ ability to step up production as the economic recovery gathers pace“. (Source: The Financial Times Limited)
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The top 3 drivers for future business success
(1) New product innovation (requires talented workers)
(2) High-skilled workforce (correlated to higher profitability)
(3) Low-cost producer status
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The report concludes that People Management Practices will have a high profile role in the growth of the Manufacturing Industry: How will the requisite skills and capabilities be sourced, developed, engaged and deployed??
A recent GALLUP poll finds that Americans think the “best way to address the problem of growing unemployment in the United States [is] … to keep manufacturing jobs in the U.S.”
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The top prescriptions for creating more jobs are
keep manufacturing jobs in the U.S. (18%)
lower taxes (14%)
provide more help to small businesses (12%)
create more infrastructure work (10%)
reducing government regulations on business (7%)
creating more green jobs (6%)
providing more federal stimulus funding (4%)
and implementing more pro-“buy American” policies (4%)
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Many Americans see protectionism and tax cuts as ways to create jobs. I will not do any political statements here. But what I experience daily is that EDUCATION will be key to keep manufacturing jobs in the U.S. or in any other nation:
A leading incentive for offshoring is ‘race for talent’… IBM has built a new research center in Shanghai, China, because of the rich pool of science and engineering talent in China… [READ MORE]
Bert Maes
Both the U.S. and the EU will have difficulties to compete on large-scale manufacturing again, but it can still continue to unlock value in its capacity to innovate.
BERT MAES 
