How Does America “Reshore” Skills That Have Disappeared?

How Does America “Reshore” Skills That Have Disappeared?

Apr 1, 2016

By Todd Oppenheimer, Craftsmanship.net  Now that manufacturing wages in Asia are starting to rise, some U.S. industries are bringing their businesses back to our own shores. Yet many others remain skittish about the paucity of workers here who still know how to make things. Can this downward spiral be reversed? When I talked on the phone recently with Harry Moser about all the hysterical arguments this year’s presidential candidates are having about immigration, I could almost see the mischievous twinkle in his eye. Moser is the founder of The Reshoring Initiative, a Chicago-based organization dedicated to bringing manufacturing back to America. And in his view, the solution to the immigration problem is pretty simple. During your first meetings with overseas contractors, you’re likely to be shown some impressive prototypes, manufactured by a relatively skilled production team. By the time the second and third rounds of deliveries are made, the quality of the materials has declined. “The work isn’t being done by the A team anymore,” says Harry Moser of the Reshoring Initiative. “The plant now has its C team on the job.” “If I were running for president,” he told me, “here’s what I’d tell everybody I would do on day one. I would call the president of Mexico and say, ‘Why don’t you and I target certain industries in Asia, and have the U.S. and Mexico cooperate as a team to bring those manufacturing operations back to North America.’ ” Moser explained that some of that work would be best suited to the labor force in Mexico, and some is best done in the U.S. His point is that, with a little planning, our two countries could create a whole new manufacturing infrastructure on this side of the world, and a host of new jobs. This would cut our trade deficit with Mexico, boost our neighbor’s economy, and raise its workers’ wages. That, in turn, would reduce the pressure on immigration and eliminate the need for a wall—no matter who pays for it. There’s only one small problem: Neither Mexico nor the U.S. has a workforce with the full complement of skills needed to fill those jobs. Many factory workers in China aren’t...

China Expected To Lay Off Millions At State-Owned…

China Expected To Lay Off Millions At State-Owned…

Mar 2, 2016

“China Expected To Lay Off Millions At State-Owned Industrial Firms” By Andy Szal, Manufacturing.net The Chinese government is reportedly preparing to implement the most severe cutbacks in state-owned enterprises — including its industrial sector — in nearly 20 years. Reuters, citing two sources with close ties to government leadership, pegged the number of layoffs planned over the next two to three years atbetween 5 million and 6 million. The government also plans to spend billions to cover the layoffs and protect against unrest. About $23 billion will be needed for the coal and steel industries alone, which the nation’s country’s human resources minister previously estimated would see 1.8 million layoffs. China plans to reduce its steel capacity by 150 million tons and its coal production by 500 million tons in coming years, and other industries with excess supply will also see job cuts. Additional funding, meanwhile, will be needed to resolve the debts of so-called “zombie firms” — state-owned companies that ceased operations but continue to pay workers — that could compromise local banks. In the midst of economic turmoil in China, officials vowed late last year tocrack down on such companies. Reuters said that the state accounted for 40 percent of the country’s industrial output and nearly half of its bank lending. About 37 million people worked for the state as of 2013....

What Could be done about China’s Theft of Intellectual Property

What Could be done about China’s  Theft of Intellectual Property

Feb 24, 2016

By Michele Nash-Hoff, Saving U.S. Manufacturing Hardly a week goes by without a report of Chinese “hacking” or Intellectual Property Theft, so it was no surprise that a published analysis by CrowdStrike, a California-based cyber security company, revealed that China violated its cyber agreement with the United States the very next day after  CNBC reported that President Obama and China’s President Xi Jinping agreed to not conduct cyber theft of intellectual property on Friday, September 25, 2015. President Obama said. “The United States government does not engage in cyber economic espionage for commercial gain, and today I can announce that our two countries have reached a common understanding on a way forward.” However, the U.S.-China agreement “does not prohibit cyber spying for national security purposes.” It is interesting to note that the day before the announcement, September 24, 2015, Chet Nagle, a former CIA agent and current Vice President of M-CAM, penned an article in the Daily Caller, stating, “At FBI headquarters in July, the head of FBI counterintelligence, Randall Coleman, said there has been a 53 percent increase in the theft of American trade secrets, thefts that have cost hundreds of billions of dollars in the past year. In an FBI  survey of 165 private companies, half of them said they were victims of economic espionage or theft of trade secrets – 95 percent of those cases involved individuals associated with the Chinese government.” He blamed the corruption of Chinese government officials for the problem and stated that “President Xi Jinping has instituted a strict anti-corruption campaign. Regrettably, the campaign has focused on “tigers” – senior government officials – at the expense of eliminating the rampant corruption by the “flies” – officials at the provincial and local level. In any event, putting a dollar value on direct corruption does not address the totality of the costs. Business confidence and foreign direct investment in China are already falling because of the absence of the rule of law.” He concluded, “China’s disregard of the rule of law should be the underlying driver for all discussions of commercial topics during the coming visit of China’s president. Lack of the rule of law is the most difficult...

What a ball pen tells us about China’s manufacturing weakness

What a ball pen tells us about China’s manufacturing weakness

Jan 26, 2016

By Ko Tin-yau, ejinsight Premier Li Keqiang recently made a shocking revelation about the industrial capabilities of China on national television: despite the fact that the country is widely known as the “world’s factory” and produces everything from iPhones, aircraft carriers, high-speed railways to spacecraft, until now there is not a single manufacturer in China that is able to produce the tiny rotating ball fitted to the tip of a ball pen that disperses ink as you write. Each of these tiny metal balls has to be imported by Chinese pen manufacturers from overseas suppliers. Many TV viewers in the mainland were deeply shocked and saddened by this revelation, as they had all been under the impression that China is already a world-class industrial power. The harsh fact is that, even though China produces 38 billion ball pens every year, it is still unable to manufacture the key component, the rotating ball point. How could a tiny component of an object so commonplace that goes for less than one US dollar prove to be an insuperable hurdle for the entire Chinese industrial complex? Qiu Zhiming, chief executive of Beifa Group Co. Ltd., China’s leading stationery manufacturer, said the reason it is so difficult to produce that component is that the ball — which is usually made of brass, steel or tungsten carbide and kept in place by a socket at the tip of the ball pen — is so tiny (usually not more than 0.1 millimeter in diameter) that it requires state-of-the-art machinery and cutting-edge computerized measurement equipment with pinpoint precision to produce, not to mention the ability to produce the high-quality steel material of which it is made. The margin for inaccuracy in the production process of this tiny ball point is basically zero, or else it won’t be able to be fitted into the socket perfectly and rotate freely in order to deliver ink. Unfortunately, all these key technologies remain the weakest links in China’s manufacturing industry even to this day. As a result, all the rotating metal balls fitted to made-in-China ball pens have to be imported from Germany, Switzerland or Japan. The root cause of China’s backwardness in some of the...

U.S. Manufacturing Leaders Say Government is Failing to…

U.S. Manufacturing Leaders Say Government is Failing to…

Jan 7, 2016

“U.S. Manufacturing Leaders Say Government is Failing to Deliver the Help They Need” By Jeff Moad, Manufacturing Leadership With several U.S. presidential candidates promising to reinvigorate the manufacturing sector and “bring home” manufacturing jobs, and with the White House attempting to keep pace with manufacturing revitalization initiatives emerging from major global competitors including China, Germany, and India, you might expect manufacturing leaders to feel that their industry, at last, is receiving from policy makers the attention and help it needs. But you would be wrong. According to a recently-completed survey by the Manufacturing Leadership Council, the vast majority of manufacturers—78%–believe that their federal government is ineffective in supporting and enabling their success, and most (60%) have little faith that that will change over the next 12 months, campaign promises notwithstanding. Only 25% said policy makers have become more aware of and responsive to the needs of manufacturers over the past 12 months. Manufacturers said governments in Germany and China, in particular, are far more effective than the U.S. federal government in developing and implementing policies that support their manufacturing sectors. Where are manufacturers most in need of help from policy makers? Overwhelmingly, respondents to the Manufacturing Advocacy Survey said they need help attracting and developing the next-generation manufacturing workforce. Manufacturers also targeted regulatory reform, tax reform, and trade reform. Of much less concern are issues such as healthcare reform, and policy concerning currency, immigration, and energy. At the same time, 62% of manufacturers said they would welcome increased government support of university research aimed at helping the industry. And most (60%) said the industry would benefit from a  cabinet-level federal government agency devoted to the support and development of manufacturing. Manufacturers responding to the survey were split on President Obama’s proposed Trans-Pacific Partnership free trade agreement, with 38% expecting a positive impact from it, and 37% expecting a negative impact. While manufacturers are highly critical of government’s performance in supporting industrial companies and markets, they don’t let themselves off the hook. In particular, manufacturers said they can and should do more to improve the public image of manufacturing. Thirty-four percent of manufacturers described the public’s view of manufacturing as negative or very negative, and they say that...