Why We're Betting on Manufacturing

By: Jeff Immelt, LinkedIn America can turn a slow recovery into a strong comeback, one that grows our economy and firmly reestablishes our country as a powerhouse of ideas and production. The key – and what will determine the winners and losers of an exciting new era – is our willingness and ability to lead the next “big waves” of productivity. There are four new drivers of productivity, and success in each depends on the technology and talent we develop. The first is how the sheer volume and increased access to shale gas in regions around the globe is changing the energy debate and the balance of energy power. It would require real infrastructure and pipeline integration between Canada, Mexico and the U.S., but North America could achieve energy independence within 10 years. The second driver for dramatically increased productivity is applying the lessons of social media to the industrial world and building what we call the Industrial Internet. By owning and connecting the analytical layers around industrial products – and using real time data to extract real time knowledge – we can improve asset performance and drive efficiency. The third driver is speed and simplification because the only way to serve our customers better and compete in a complex world is by working faster and smarter. The last productivity driver, and related to the other three, is the evolution of advanced manufacturing. Manufacturing excellence, forgotten for too long, is once again a competitive advantage. Today, we are convening a forum in Washington, DC to discuss the future of manufacturing and its impact on the economy. It’s an exciting time; we can reverse a trend where companies outsourced critical capabilities in their supply chain and focused too much on cheap labor rather than speed, innovation and market access. Now, advanced manufacturing — both imbedding technology into products and processes and creating the highly skilled workforce that can support these efforts — and other new innovations in manufacturing are changing what we make, where and how we make it, and even who makes it. Large or small companies that invest in their own capabilities and “own” or control a local supply chain have a competitive...

Goods Orders Probably Climbed as U.S. Manufacturing Stabilized

By: Shobhana Chandra, Bloomberg Orders for durable goods probably climbed in December, showing U.S. manufacturing stabilized following a mid-year slump. The 2 percent gain in bookings for goods meant to last at least three years would follow a 0.8 percent rise in November, according to the median forecast of 64 economists surveyed by Bloomberg. Orders excluding demand for transportation equipment, which is often volatile, may have advanced for a fourth consecutive month. Improving auto sales and a rebound in housing are underpinning the economic expansion, indicating orders will keep coming in for manufacturers from General Electric (GE) to DuPont Co. (DD) Faster growth in overseas markets and an agreement in Congress to avoid automatic government-spending cuts would help lift business confidence and spur greater investment. “Manufacturing is looking better,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto. “Demand has been improving nicely.” The Commerce Department will release the durable-goods data at 8:30 a.m. in Washington. Estimates in the Bloomberg survey ranged from a drop of 1.4 percent to a gain of 4.5 percent. At 10 a.m., the National Association of Realtors may report its index of pending home sales rose 0.1 percent in December after increasing 1.7 percent the prior month, economists in the Bloomberg survey projected. Aircraft bookings, which are often volatile, provided a boost to orders last month, the Commerce Department figures may show. Boeing Co. (BA), the Chicago-based aerospace company, said it received 183 orders in December, up from 124 the prior month. Business Investment Bookings for non-defense capital goods excluding aircraft, a proxy for future business investment in items like computers, engines and communications gear, took a breather last month following the biggest back-to-back gain in almost two years, economists projected. Shipments of such items are used in calculating gross domestic product. A report on Jan. 30 may show GDP expanded at a 1.2 percent annual pace in the final quarter of 2012, helped by growth in consumer spending, corporate investment and housing, according to the Bloomberg survey median. Capital spending dropped at a 2.6 percent annual rate in the third quarter, the first decline in more than three years. Automobile purchases remain a source of...