In early December of last year, CNBC held a panel discussion on the future of manufacturing at Carnegie Mellon University. Now, this was not the first such meeting to discuss this important subject nor will it be the last, but I was struck by how even a stellar group of business and industry leaders couldn’t arrive at a clear consensus about what to do to strengthen U.S. manufacturing today and in the years ahead.
The discussion, moderated by Maria Bartiromo of CNBC and billed as “Meeting of the Minds: Rebuilding America,” included Daniel R. DiMicco, chairman and CEO of Nucor Corp.; John Engler, president and CEO of the National Association of Manufacturers; Bill Ford, executive chairman of Ford Motor Co.; Leo W. Gerard, international president of the United Steelworkers International; Jeff Immelt, chairman and CEO of General Electric; and Hilda L. Solis, U.S. Secretary of Labor.
As you might imagine, the choice of Pittsburgh for the venue, not only the home of Carnegie Mellon, but also the heartland of the U.S. steel industry where so many jobs have been lost over the years, guaranteed that much of the discussion would focus on how to bring manufacturing jobs back to the United States. But, like many other issues facing manufacturing these days, the jobs issue isn’t a simple one.
“Ten percent unemployment is unacceptable, but this has been coming for decades,” Immelt said. “We can’t go to a service economy in one generation. We’ve done a terrible job of keeping manufacturing jobs over the years. If we run the same old playbook, this ain’t going to get fixed.”
But if that’s true, what’s the new playbook? The panelists talked about retraining workers, enforcing trade agreements with such countries as China, encouraging more students to go into science and engineering (how many times have we heard that one?), focusing more on infrastructure rebuilding and alternative energy opportunities, and increasing exports, among other suggestions.
“We need the equivalent of a moon shot,” said Ford, in a reference to the challenge laid down by President Kennedy in the early 1960s, a challenge that had more to do with countering Soviet military objectives than creating manufacturing jobs. But, point taken; DiMicco of Nucor and Gerard of the United Steelworkers both agreed that the United States needs a national strategy for manufacturing and a federal government that is an ally, not “an adversary,” as Ford expressed it.
But Immelt stressed an external view, emphasizing that manufacturing is a global market. “There is a billion new consumers outside the U.S.,” he said. “The biggest crime in the country is that R&D spending is pitifully low. Fundamentally, we have to turn this country into an exporter again. We’ve got to be a hungrier country, a more competitive country, and willing to sell products anywhere in the world.”
Taken together, the panelists’ suggestions might just help restore some jobs and even shore up manufacturing’s declining contribution to GDP, now at 11.5%, but I was left with an uneasy feeling that these ideas, which have been in the market for some time, may not be enough.
DiMicco touched upon a key part of the problem: “Is all of this just window dressing? Are we really interested in doing this?”
That’s the central question facing us. Do we have the national will to put manufacturing on the front burner? What your view? Write to me at Dbrousell@thomaspublishing.com.