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Raising the Alarm for US Manufacturing

Raising the Alarm for US Manufacturing

Feb 7, 2018

By Steve Minter, IndustryWeek Rebuild Manufacturing: The Key to American Prosperity In her latest book chronicling the state of U.S. manufacturing and the policy changes needed to shore up the sector, Michele Nash-Hoff, a contributor to IndustryWeek, notes that one of her ancestors was Paul Revere. While Nash-Hoff has not been galloping through the Massachusetts countryside warning of British troops, she has been crisscrossing the United States in recent years visiting American factories, warning of threats to domestic manufacturing and offering advice on how to rebuild the manufacturing ecosystem. Paul Revere, a celebrated silversmith who also ran a foundry after the Revolutionary War, would be proud. Rebuild Manufacturing (Coalition for a Prosperous America, 2017) starts off with a recounting of statistics that are familiar to many manufacturers but still shocking. The U.S. lost 5.86 million manufacturing jobs between 2000 and early 2010, or roughly the populations of Chicago, Houston and Indianapolis combined. During that decade, the U.S. lost 57,000 manufacturing firms. Throughout this period and for a considerable time before, educators and parents were watching (or experiencing) what was happening in manufacturing. The lesson they imparted to countless kids: Manufacturing has no future in the U.S. and neither will you if you choose a career in a factory. Thanks to a long recovery beginning in the Obama administration and continuing in the Trump presidency, manufacturing is coming back, though that journey is far from over. Activists such as Nash-Hoff have helped turn the tide against the popular belief in Washington and other centers of economic thought that the U.S. had grown out of the need for manufacturing. It is increasingly clear that a vibrant manufacturing sector is crucial to a healthy and growing U.S. economy. In Rebuild Manufacturing, Nash-Hoff offers a wealth of information and recommendations on what can be done to strengthen U.S. manufacturing. She points the finger repeatedly at the huge trade imbalance with a mercantilist China (in 2017, nearly $309 billion through October) and calls for action by Trump and Congress to fight intellectual property theft and take a much tougher stand against acquisitions of American companies by Chinese firms. “Letting Chinese corporations acquire American companies, especially energy or technology-based companies is the biggest threat...

U.S. Manufacturing Expands at Close to Quickest Pace Since…

U.S. Manufacturing Expands at Close to Quickest Pace Since…

Feb 2, 2018

“U.S. Manufacturing Expands at Close to Quickest Pace Since 2004” By Sho Chandra, Bloomberg U.S. factories expanded more than forecast in January and near the fastest pace in more than 13 years, indicating manufacturing was still powering ahead at the start of 2018, Institute for Supply Management data showed Thursday.Factory index was little changed at 59.1 (est. 58.6) from 59.3 in Dec.; readings above 50 indicate expansion Highlights of ISM Manufacturing (January) Factory index was little changed at 59.1 (est. 58.6) from 59.3 in Dec.; readings above 50 indicate expansion  Gauge remains close to Sept. reading of 60.2, which was the highest since June 2004 Measure of new orders cooled to 65.4 from an almost 14-year high of 67.4 Employment gauge fell to an eight-month low of 54.2 from 58.1   Key Takeaways The January reading, which exceeded the 57.4 average for 2017, shows manufacturing is benefiting from solid consumer spending and business investment. What’s more, a measure of exports advanced to an almost seven-year high, underscoring improving overseas markets.  The pickup in manufacturing is starting to generate inflation pressures as factories demand more raw materials including crude oil. The ISM’s measure of prices paid increased to the highest level since May 2011.  In a sign factories are challenged by elevated demand, the ISM’s measure of supplier deliveries climbed to a three-month high and its backlogs index rose to the highest level since September. The ISM report comes a day before the Labor Department’s January jobs report, which is projected to show an increase in factory payrolls helped to boost overall employment. Other Details ISM measure of prices paid jumped to 72.7 from 68.3 Index of factory inventories rose to 52.3, indicating stockpiles were expanding, from 48.5  Gauge of production fell to 64.5 from 65.2  Export orders measure advanced to 59.8, the strongest since April 2011, from 57.6 Supplier deliveries gauge rose to 59.1, indicating longer lead times, from 57.2; index of backlogs climbed to 56.2 from 54.9  — With assistance by Chris...

Trump highlights Staub Manufacturing Solutions at SOTU

Trump highlights Staub Manufacturing Solutions at SOTU

Jan 31, 2018

  Featured on Fox News   President shares company’s story during address and invites members to the White House.     Watch the latest video at...

How will Industry 4.0 impact U.S. manufacturing?

How will Industry 4.0 impact U.S. manufacturing?

Jan 26, 2018

By JLL Staff Reporter, Real Views The Fourth Industrial Revolution is picking up steam in warehouse aisles and factory floors around the world. As advancing technology brings the manufacturing industry closer to the vision of a ‘smart factory,’ the future of U.S. manufacturing depends on how well industry leaders play the new cards in the deck: robotics, data, automation and 3D printing—without overlooking the value of human capital. So far, the U.S. appears ready for change, earning a “well positioned for the future” nod from the World Economic Forum’s 2018 Future of Production assessment, which evaluated production structures in countries around the world. While human-free warehouses and factories are still a long way off, more sophisticated, tech-fueled automation is already becoming a standard feature of the nation’s industrial buildings. These days, drones equipped with sensors can scan bar codes for inventory purposes, safely restock and pick merchandise on high shelves, and move small items quickly around the warehouse. Meanwhile, robotics and other technologies such as 3D printing, connected sensors and artificial intelligence are drastically transforming the way goods are manufactured. “Industry 4.0 represents a clear opportunity for the U.S. manufacturing sector when you think about the skilled positions coming back into the economy,” says Aaron Ahlburn, Managing Director, Industrial & Logistics Research, JLL. “Most industry-relevant technology works best when paired with intelligent use, and the U.S. has a competitive advantage when it comes to skilled, tech-savvy labor.” The factory of the future depends on today’s talent The United States’ manufacturing sector is the second largest in the world, after China. According to WEF’s 2018 report, the U.S. “is globally renowned for its ability to innovate and is currently at the forefront of major developments surrounding the emerging technologies of the Fourth Industrial Revolution.” This won’t be the first time the U.S. manufacturing industry has won in terms of innovation. This is, after all, the birthplace of the moving assembly line. And earlier automation technologies have already made this a country where only two in five employees are now directly engaged in production, according to a Congressional Research Service report. Still, according to the same report, the nation’s share of global manufacturing value has declined over time, dropping from 29 percent...

Primed for Another Year of Growth

Primed for Another Year of Growth

Jan 23, 2018

By Neil Dutta, Bloomberg  The global economy is a big driver, but domestic demand is even more important. U.S. manufacturing production just had its best year since 2011, yet some argue that 2017 was as good as it will get and that a slowdown is ahead. We think the opposite is more likely: Factory output is poised to speed up. Investors worried that the equity market is stretched should take heart. Stronger growth in factory output is a good reason to remain cyclically oriented, especially in U.S. industrial stocks. Trade, one of the biggest engines of the sector in 2017, is likely to continue to gather momentum. Stronger global growth expectations and a weaker dollar should help as manufacturing goods represent about half of all exports. Moreover, at least some of the current recovery in factories can be traced to the rebound in the mining industry. Mining output declined steadily from December 2014 to September 2016. Production was down 0.6 percent during this period, when there was also a sharp pullback in oil and drilling equipment. Today, we are seeing the opposite dynamic. With commodity markets in recovery, mining-related investment is more of a tailwind to factories. While the global economy is a big driver of manufacturing growth, U.S. domestic demand is even more important. Every 1 percentage point increase in domestic demand (GDP net of trade) boosts manufacturing production by 1.34 percentage point on an annualized basis, while every 1 percentage point increase in global industrial production outside the U.S. lifts domestic manufacturing production by 0.44 percentage point. There are several positive, somewhat related signs for the manufacturing outlook in the domestic economy. First, U.S. inventory investment is simply too low. Although the contribution of inventories to growth can be volatile from quarter to quarter, inventories tend to grow in line with final sales over longer periods of time. Today, that simply is not happening; inventories have been trailing the growth in domestic demand. If the economy expands at 2.2 percent, the rough trend since the end of the recession, inventories would need to grow by about $50 billion per year to keep pace with demand. Inventories ran below that level in 2017....

Apple announces plans to repatriate billions in overseas cash…

Apple announces plans to repatriate billions in overseas cash…

Jan 19, 2018

“Apple announces plans to repatriate billions in overseas cash, says it will contribute $350 billion to the US economy over the next 5 years” By Anita Balakrishnan, CNBC Apple on Wednesday made a slew of announcements about its investment in and contribution to the U.S. economy in part because of the new tax law. The headline from Apple is that it will make a $350 billion “contribution” to the U.S. economy. The company also promised to create 20,000 new jobs and open a new campus. It said it expects to pay about $38 billion in taxes for the horde of cash it plans to bring back to the United States. This implies it will repatriate virtually all of its $250 billion in overseas cash. Apple also said it will spend over $30 billion in capital expenditures over the next five years. About $10 billion in capital expenditures will be investments in U.S. data centers, the company said. Apple added that it will spend $5 billion as part of an innovation fund, up from the $1 billion CEO Tim Cook announced last year on CNBC’s “Mad Money.” The job creation will include direct employment and also suppliers and its app business, which it had already planned to grow substantially (app developers earned $26.5 billion in 2017.) The new campus will focus on customer support. Wednesday’s announcement indicates that Apple will still have hundreds of billions of dollars in cash. It could spend that money on buybacks, dividends or acquisitions or moonshot projects. The announcement raises the bar for the world’s most valuable company — now a huge driver of the economy — to continue its dominance and growth in the wake of political pressure on big tech companies. The plan calls for Apple to keep up 2018’s $55 billion “supercycle” spending rate with domestic suppliers and manufacturers. “We have a deep sense of responsibility to give back to our country and the people who help make our success possible,” Cook said in a statement. Apple to create 20,000 jobs over the next 5 years from CNBC. In 2016, then president-elect Donald Trump publicly called out Apple’s reliance on its Chinese supply chain, telling The New York...