Survey: US August factory activity at 6-plus year high

Survey: US August factory activity at 6-plus year high

Sep 6, 2017

By Marcy Gordon, AP Business Writer, ABC News U.S. factories expanded at a brisk pace in August, a likely sign of strength for the U.S. economy as new orders, production and employment all improved. The Institute for Supply Management said Friday that its manufacturing index rose to 58.8 percent last month from 56.3 percent in July. Anything above 50 signals that factory activity is increasing. The measure now stands at its highest level since April 2011, pointing to solid economic growth. Fourteen of eighteen manufacturing industries surveyed by ISM posted growth in August, including the machinery, petroleum and coal products, and computer and electronic products sectors. August was “a really strong month,” Timothy Fiore, chair of ISM’s manufacturing business survey committee, said in a telephone interview. He noted that the growth was mostly driven by the top manufacturing sectors. It’s early to predict the impact on the oil, gas and chemical industries and on the broader economy of Hurricane Harvey. But Fiore said a snap survey of ISM members showed there likely will be a significant hit to the petroleum and chemical products sectors and “lots of supply chain disruptions.” Refining capacity, raw materials and the ability to deliver products all have been drastically affected by the storm that lashed Houston and nearby areas and shut down oil refineries, plastics plants and the Houston port — the second-busiest in the nation. There have been widespread reports of gasoline shortages. The chemical products sector is one of the six biggest manufacturing industries, accounting for 17 percent of total activity, Fiore noted. Petroleum and coal, also among the “Big Six,” account for 7 percent. Texas represents more than 10 percent of U.S. manufacturing production. Chemical products refining in the state accounts for 20 percent of the U.S. total, and oil and gas represents 30 percent. U.S. factories have largely recovered from a slump in late 2015 and early 2016 caused by cutbacks in the energy industry and a strong dollar, which makes U.S. goods more expensive in foreign markets. Manufacturing employment began a sustained turnaround in December and enjoyed four additional months of job gains, only to have factories shed 1,000 workers in May. New government data issued Friday...

How Wages, Taxes, and American Value are Reshoring…

How Wages, Taxes, and American Value are Reshoring…

Aug 24, 2017

“How Wages, Taxes, and American Value are Reshoring US Manufacturing Jobs” By Paul Carlson, CliftonLarsonAllen The flow of American manufacturing jobs overseas has peaked and is now reversing as U.S. companies find more than just economic reasons to bring them back home. Over the past few decades, the United States has lost as many as 4 million manufacturing jobs to foreign nations as companies look for ways to reduce costs. But the overseas manufacturing landscape is changing significantly. The emerging market wage difference that existed when the decision was made to offshore manufacturing is now dwindling, and in the past few years the costs of production have been increasing. This, in turn, has led to a growing number of companies reshoring — bringing manufacturing back to the United States. Catch the reshoring wave According to the 2016 Reshoring Report from the Reshoring Initiative — an organization working to return manufacturing jobs to the United States — more jobs are returning to the United States than are going abroad. “We publish this data annually to show companies that their peers are successfully reshoring and that they should reevaluate their sourcing and siting decisions,” says Harry Moser, founder and president of the Reshoring Initiative, in a May 15, 2017, statement. “With 3 to 4 million manufacturing jobs still offshore, as measured by our $500 billion annual trade deficit, there is potential for much more growth.” The report found that 77,000 new reshoring and foreign direct investment (FDI) manufacturing jobs were created in 2016. This is a 500 percent increase from the low of 2000 – 2003, when only 12,000 jobs were created on average annually. Overall, it is estimated that a net 25,000 new jobs were created in 2016. Jobs are returning from Asia Most of the jobs being reshored are from Asian countries, where 138,450 jobs have already been brought back to the United States. Of those jobs, most came from China. During the 2010 to 2016 timeframe, China accounted for approximately 60 percent of all manufacturing jobs created by reshoring and FDI. One of the biggest reasons for this trend is the shrinking wage benefit in China. Since 2001, the hourly Chinese manufacturing has risen by approximately 12 percent a year on...

Manufacturing jobs opening in US, are workers qualified?

Manufacturing jobs opening in US, are workers qualified?

Aug 16, 2017

By The Associated Press Fox Business As Wisconsin state legislators prepare to vote on Gov. Scott Walker’s (R-Wis.) $13 billion incentives package for Taiwanese manufacturing giant Foxconn’s first U.S. manufacturing plant this week, the state immediately needs to address a dilemma troubling workers and employers across the country: the skills gap. The Foxconn plant is expected to bring as many as 13,000 direct jobs to Wisconsin, according to Walker, with starting salaries of $53,000 plus benefits. The Foxconn plant could also potentially create 22,000 indirect positions within Wisconsin. It would be a substantial gain for a state that currently has 472,000 manufacturing jobs and is still recovering from factory layoffs. Walker said he has already begun discussions with colleges about training opportunities to prepare graduates for work at the plant. But the need for high-skilled employees at the new manufacturing plant highlights the paradox of manufacturing jobs in 2017. Donald Trump won the presidency in great measure because he pledged to stop American jobs and manufacturing from going overseas, winning Rust Belt votes from blue-collar voters. It’s true that many jobs have gone overseas, to lower-wage workers. But at the same time, American manufacturers have actually added nearly a million jobs in the past seven years. Labor statistics show nearly 390,000 such jobs open. The problem? Many of these are not the same jobs that for decades sustained the working class. More and more factory jobs now demand education, technical know-how or specialized skills. And many of the workers set adrift from low-tech factories lack such qualifications. Factories will need to fill 2 million jobs over the next decade, according to a forecast by Deloitte Consulting and the American Manufacturing Institute. Workers are needed to run, operate and troubleshoot computer-directed machinery, including robots, and to maintain complex websites Last year, software developer was the second-most-common job advertised by manufacturing companies, behind only sales, according to data provided by Burning Glass Technologies, a company that analyzes labor market data. Yet the United States for now remains a follower, not a leader, of the trend. Workers in many European and Asian countries are more likely to be working with robots than U.S. workers, studies show. In such...

Last American Baseball Glove Maker Refuses to Die

Last American Baseball Glove Maker Refuses to Die

Aug 14, 2017

By Andrew Mayeda, Bloomberg News New Equipment Digest How is a niche manufacturer of baseball gloves in northern Texas still hanging on? Good ol’ American grit. This little brick factory isn’t supposed to be here. It should be in the Philippines, or Vietnam, maybe China. Not here, in the heart of Texas. Baseball gloves, like many other things, aren’t really made in America anymore. In the 1960s, production shifted to Asia and never came back. It might be America’s favorite pastime, and few things are more personal to baseball-lovers than their first glove — the smell, the feel, the memory of childhood summers. But most gloves are stitched together thousands of miles away by people who couldn’t afford a ticket at Fenway Park. One company didn’t get the memo. Since the Great Depression, Nokona has been making gloves in a small town outside Dallas with a long history of producing boots and whips for cowboys. There’s a livestock-feed store next door to the factory, which offers $5 tours for visitors who want to see how the “last American ball glove” is made. You can watch employees weave the webbing by hand, feed the laces through the holes with needles, and pound the pocket into shape with a rounded hammer. The American flag gets stitched into the hide — and that, they say at Nokona, is more than just a business matter. “Made in America means you believe in our country,” said Carla Yeargin, a glove inspector and tour guide at Nokona, where she worked her way up from janitor. “We have the love for the ballglove, because we made it here.” And the final product could cost you 25 times more than a foreign-made version at the local discount store. Yes, that’s partly a reflection of the premium nature of the Nokona line but still it represents a huge challenge for the company, as well as for Donald Trump. “Making it here” is a big deal for the president. Last month Trump staged a week of events to celebrate U.S. manufacturing, showcasing products from Campbell’s soup to Caterpillar construction gear. July 17 was declared “Made in America Day.” “Restoring American manufacturing will not only restore our wealth, it will...

Keys To Strengthening U.S. Manufacturing

Keys To Strengthening U.S. Manufacturing

Aug 11, 2017

By Jay Moon, Executive Director of the Mississippi Manufacturer’s Association Delta Business Journal Manufacturing in the United States is poised for a renaissance not seen at any other time in recent history. The past decade has seen new investments in automation and efficiencies that have significantly increased industrial productivity. Added to these rapid technological advancements, new proposals by the Trump administration promise to make U.S. based manufacturing more globally competitive. These proposals, if enacted, will once again position American’s industrial sector as the driving force of our economy. The three broad categories of reform—regulatory relief, tax adjustment and infrastructure investment—individually and collectively, will position America’s manufacturing base to remain globally competitive. After years of increasingly onerous, and expensive, regulations being forced on business and industry by unelected bureaucrats in Washington, Congress and the Trump administration have begun to rescind or drastically scale back these mandates. According to a recent study by the National Association of Manufacturers (NAM), “Since 2009, 637 major new regulations—defined as having an annual effect on the economy of at least $100 million—have been issued through October 2016.” Considering that manufacturers were the frequent target of these regulations, each new rule translated into increased compliance costs that put our companies at a major disadvantage with their global competitors. By removing these barriers to success, our nation’s manufacturers can begin to operate under a regulatory process that is both fair and scientifically based. Similarly, our current tax system puts American manufacturers at a competitive disadvantage. We have the highest corporate tax rate among developed countries. When this rate is combined with state taxes, manufacturers face an aggregate tax burden that can reach 40 percent or higher. In addition to a high tax rate on profitability, manufacturers have to contend with dozens of additional taxes at the federal, state and local levels that impact their bottom line. Fortunately, leadership in Congress is focused on advancing pro-growth, pro-competitive tax reform policies that will strengthen our economy, create jobs and promote investment in America. This comprehensive approach to tax reform, which has not happened since the mid-1980s, will be the catalyst to allow U.S. companies to compete effectively in the 21st century world economy. Equally as...