The media, unfortunately driving popular perception, continues to insist that North American manufacturing is dying.
Sure, U.S. banking is in trouble, but the longer-term and possibly
more damaging threat to the nation’s prosperity is the decline of the
manufacturing sector. Late last year, the number of U.S. manufacturing
jobs dropped below 14 million for the first time since 1950.
We continue to try to correct this perception with the facts.
America’s manufacturing output, as measured by the Federal Reserve, is
up seven-fold since 1950, but manufacturing jobs as a share of all jobs
have fallen to 10% from 30%. The problem, if it really is one, is not foreign competition or evil
financiers. It is technology and productivity. In the 10 years ending
in 2007, durable goods manufacturing productivity averaged an annual
growth rate of 4.8%.
And even our friend Jim Womack has tried to use his considerable stature to change the presumption of manufacturing decline.
Manufacturing output has increased 11 percent in the last year. U.S. exports of manufactured goods are also up over 12 percent. Moreover, U.S. manufacturers consider the United States the most
desirable country for expansion of their businesses over the next three
years, according to a recent survey of 321 North American manufacturing
executives released in mid-June by the National Association of
Manufacturers, The Manufacturing Institute, the Canadian Manufacturers
and Exporters and Deloitte Touche Tohmatsu. And 57 percent of U.S.
manufacturers predicted they will become more globally competitive over
the next five years.
But sometimes it takes a real story to really bring it home.
A rugged cadre of producers like these in Manitowoc have survived a
decades-long shakeout of American manufacturing — and are now leading
a largely overlooked revival. Many towns that have retained their factories — and are adding
manufacturing jobs in the face of a wider downturn — share certain
traits. They have a deep history of manufacturing and a pool of skilled
laborers and entrepreneurs who still live there.
Another reason is that they understand the power of knowledge and speed.
Orion is the brainchild of an inveterate tinkerer,
Neal Verfuerth, who was raised in a small town an hour south of
looking for something to do during the long winters, when tuck-pointing
halts, he started selling solar panels and developed an interest in
alternative energy. He started Orion in 1996, initially distributing
lights for other manufacturers, and by 2000, producing high-efficiency
Mr. Verfuerth is convinced manufacturing needs to
return to its vertical roots: A company should make most of its
component parts itself. Outsourcing, he says, has diminished quality
and service. Moreover, in the middle of the night, when he has an idea,
he wants to be able to come to his factory and try to build it.
Sort of like our friend Dov Charney’s short elevator trip. Although I’m fairly sure Mr. Verfuerth doesn’t share Dov’s other "attributes."
Manufacturing is succeeding in North America. Sometimes you just have to look past the bluster to find the facts.