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Is the U.S. Manufacturing Renaissance Real?

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A worker welding the outside of a safe at the Champion Safe Co. manufacturing facility in Provo, Utah, on Wednesday, Feb. 22, 2012. – GEORGE FREY / BLOOMBERG / GETTY IMAGES

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Rana Foroohar and Bill Saporito
U.S. manufacturing is back. That’s been the conventional economic wisdom now for several months, and there’s plenty of proof to back it up – rising factory output, strong manufacturing production gains, and lower labor costs that make American workers more attractive.
Couple that with the natural gas boom underway in the U.S., which many experts believe will lower energy costs for U.S. manufacturers, and you’ve got a resurgence of a sector that has been shrinking as a percentage of the economy for several decades. “We are probably the most competitive, on a global basis, than we’ve been in the past 30 years,” says GE CEO Jeff Immelt. “Will U.S. manufacturing go from 9% to 30% of all jobs? That’s unlikely. But could you see a steady increase in jobs, over the next quarters and years. I think that will happen.”

But at least one economic seer, Goldman Sachs’ chief economist Jan Hatzius, is throwing a bit of cold water on the idea. He recently released a report, which is getting a lot of attention on the web, arguing that the U.S. “manufacturing renaissance” is cyclical, not structural – meaning, the sector is doing as well as would have been predicted under any circumstances at this point in an economic recovery, and that the gains don’t point to a real seismic shift in U.S. manufacturing competitiveness. “Measured productivity growth has been strong,” admits Hatzius in the report, entitled “U.S. Manufacturing Renaissance: Fact or Fiction?” “But U.S. export performance – arguably a more reliable indicator of competitiveness—remains middling at best.”

It’s a very interesting point, and it matters a lot to the broader economy. Nations that do better in manufacturing gain an edge in the global economy: For every $1 of manufacturing output in a community, there’s another $1.48 of wealth created. That’s why economic advisors to the President, like National Economic Council head Gene Sperling, have been pushing pro-manufacturing policies. But the Goldman report would seem to indicate that the strength in U.S. manufacturing output reflects more the relative weakness of Europe (which is mired in a debt crisis) and Japan, rather than a long-term positive shift in the U.S. itself. “Over the next few years, the manufacturing sector should continue to grow a bit faster than the overall economy,” notes the report. “But the main reason is likely to be a broad improvement in aggregate demand rather than a structural U.S. manufacturing renaissance.”

Hatzius was on holiday this week and unavailable for comment (we’ll be following up with him next week), but one immediate question is whether exports really do provide a more accurate picture, as the report suggests. It may be that more goods manufactured in the U.S. are staying in the U.S. As we’ve traveled around the country reporting on this topic over the last couple of years, a number of big industrial firms have pointed to growing demand for their products here at home – Caterpillar, which makes an increasing amount of its large earth-moving equipment for domestic mining, agriculture, and energy operations, is a great case in point.

Then there’s the question of how to look at the productivity numbers. While U.S. productivity is up over the last several years relative to, say, China, which has been flat (and also suffers from rising wages), the big question is how much more it can go up. We feel there’s reason to be bullish on the growth potential there, given how materials science and the evolution of the “industrial internet” are fundamentally reshaping manufacturing in the U.S.’s favor. The once separate steps of designing a product, making or buying the parts, and then putting everything together are beginning to blend — a consequence of technologies such as additive manufacturing and 3-D printing. It means that manufacturing wants to be closer to engineering and design — a dynamic that would likely benefit the U.S., which still rules those high-end job categories. Add the ability to include sensors in every part and process, and you’ve got a whole new manufacturing ecosystem that allows companies to accelerate product development cycles and deliver more variety and value more quickly to ever more fickle consumers.

Of course, the jobs that are being created aren’t your father’s (or grandfather’s) factory jobs of knocking in four bolts a minute for eight hours a day. The new economics of Made in the USA are built in large part around acquiring cutting-edge technologies ahead of global competitors and then using those new techniques to produce more efficiently on super-automated factory floors. And while all the technology will translate into higher end jobs, it will also mean — barring dramatic growth — fewer jobs overall, especially in the middle. Positions will either be high end, or lower paid, since workers still have to compete with cheaper overseas labor (even with wage inflation in China, it will be years before the Chinese are on par with U.S. wages). It’s no accident that many of the new manufacturing clusters in the U.S. are in the South, where unions hold less power. “Yes, manufacturing is coming back, but it’s evolving into a very different type of animal than the one most people recognize today,” says James Manyika, says James Manyika, director of McKinsey Global Institute, which recently did an exhaustive study on this shift entitled “Manufacturing the Future.” “We’re going to see new jobs, but no where near the number some people expect, especially in the short term.”

It’s a sentiment that stands in sobering contrast to President Obama’s second term goal of creating a million new manufacturing jobs in four years. Some of the difference may lie in semantics. As Manyika points out, labor statistics underestimate the reality of manufacturing, since they count mainly jobs inside factories. Related positions in, say, Ford’s marketing department, or small businesses doing industrial design or creating new software for big exporters don’t get tallied. Yet these jobs wouldn’t exist but for the big factories. The official 9% of U.S. employment represented by manufacturing belies the importance of the sector to our overall economy. Manufacturing represents a whopping 67% of all private sector R & D spending, as well as 30% of the country’s productivity growth.

In short, manufacturing’s value can be measured in many different ways. “The ability to make things is fundamental to the ability to innovate things over the long term,” says Willy Shih of Harvard Business School and co-author of Producing Prosperity: Why America Needs a Manufacturing Renaissance. “When you give up making products you lose a lot of the added value.” That’s as good a reason as any to care about the future of manufacturing.

U.S. Must Comply with WTO Meat-Labeling Ruling by May

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Rod Nickel
(Reuters) – The United States must bring its country-of-origin meat labeling rules into compliance with a earlier World Trade Organization ruling by May 23, 2013, according to a WTO decision on Tuesday, the Canadian government said.
The WTO ruled on June 29 that the U.S. country-of-origin labeling program, known as COOL, unfairly discriminated against Canada and Mexico because it gave less favorable treatment to beef and pork imported from those countries than to U.S. meat.
 
That decision gave the United States an unspecified amount of time to comply.

The labeling program has led to a sharp reduction in U.S. imports of Canadian pigs and cattle, because it raised costs for U.S. packers by forcing them to segregate those animals from U.S. livestock. Some U.S. groups, however, have said COOL offers consumers valuable information about the origin of their food.

“We expect that the U.S. will bring itself into compliance with its WTO obligations by May 2013 as determined by the arbitrator for the benefit of producers on both sides of the border,” Canadian International Trade Minister Ed Fast and Agriculture Minister Gerry Ritz said in a joint statement.

“We are particularly pleased that the arbitrator determined a reasonable period of time close to that proposed by Canada and Mexico, as opposed to the much longer period suggested by the United States.”

According to the Canadian ministers, the United States asked that it be given until January 23, 2014 to comply. Canada and Mexico asked for compliance by early 2013.

Meat labels became mandatory in March 2009 after years of debate. U.S. consumer and some farm groups supported the requirement, saying consumers should have information to distinguish between U.S. and foreign products.

Big meat processors opposed the provision, which they said would unnecessarily boost costs and disrupt trade.

The U.S. labeling law requires grocers to put labels on cuts of beef, pork, lamb, chicken and ground meat or post signs that list the origin of the meat.

U.S. officials have said the WTO’s June ruling allowed the United States to continue to require country-of-origin labels, but Washington will have to alter the program to ensure it does not create an impermissible trade barrier.

“The United States remains committed to ensuring that consumers are provided with information about the origin of the beef and pork products they buy at the retail level,” Nkenge Harmon, a spokesperson for U.S. Trade Representative Ron Kirk, said on Tuesday. “We intend to bring the COOL requirements into compliance within the period of time established by the arbitrator, and we will continue to work with USDA, Congress, and interested stakeholders in order to do so.”

SOURCE:  Reuters

How We Could Create Jobs While Reducing The Trade Deficit and National Debt

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There are numerous ideas and recommendations on how we could create jobs but most job creation programs proposed involve either increased government spending or reductions in income or employment taxes at a time of soaring budget deficits and decreased government revenue. Other recommendations would require legislation to change policies on taxation, regulation, or trade that may be difficult to accomplish. The recommendations in this article focus on what could be done the fastest and most economically to create the most jobs while reducing our trade deficit and national debt.
Manufacturing is the foundation of the U. S. economy and the engine of economic growth. It has a higher multiplier effect than service jobs. Each manufacturing job creates an average of three to four other supporting jobs. So, if we focus on creating manufacturing jobs, we would be able to reduce the trade deficit and national debt at the same time.

The combined effects of an increasing trade deficit with China and other countries, as well as American manufacturers choosing to “offshore” manufacturing, has resulted in the loss of 5.7 million manufacturing jobs since the year 2000. If we calculate the multiplier effect, we have actually lost upwards of 17 to 22 million jobs, meaning that we have fewer taxpayers and more consumers of tax revenue in the form of unemployment benefits, food stamps, and Medicaid.

In 2012, the U.S. trade deficit with China reached a new record of $315 billion. According to a recent study by the Economic Policy Institute (EPI), the trade deficit with China cost 2.7 million U.S. jobs from 2001-2011. The Department of Commerce estimates that each $1 billion in trade deficit translates to about 13,000 lost jobs, so the $738 billion trade deficit in goods for 2012 cost upwards of 9,599,200 jobs.

What Congress Could Do

First, Congress should enact legislation that addresses China’s currency manipulation. Most economists believe that China’s currency is undervalued by 30-40% so their products may be cheaper than American products on that basis alone. To address China’s currency manipulation and provide a means for American companies to petition for countervailing duties, the Senate passed S. 1619 in 2011, but GOP leadership prevented the corresponding bill in the House, H. R. 639, from being brought up for a vote, even though it had bi-partisan support with 231 co-sponsors. On March 20, 2013, Sander Levin (D-MI), Tim Murphy (R-PA), Tim Ryan (D-OH), and Mo Brooks (R-AL) introduced the Currency Reform for Fair Trade Act in the House and a corresponding bill will be introduced in the Senate.

Second, Congress should strengthen and tighten procurement regulations to enforce “buying American” for all government agencies and not just the Department of Defense. All federal spending should have “buy America” provisions giving American workers and businesses the first opportunity at procurement contracts. New federal loan guarantees for energy projects should require the utilization of domestic supply chains for construction. No federal, state, or local government dollars should be spent buying materials, equipment, supplies, and workers from China.

My other recommendations for creating jobs are based on improving the competitiveness of American companies by improving the business climate of the United States so that there is less incentive for American manufacturing companies to outsource manufacturing offshore or build plants in foreign countries. The following proposed legislation would also prevent corporations from avoiding paying corporate income taxes:

  • Reduce corporate taxes to 25 percent
  • Make capital gains tax of 15 percent permanent
  • Increase and make permanent the R&D tax credit
  • Eliminate the estate tax (also called the Death Tax)
  • Improve intellectual property rights protection and increase criminal prosecution
  • Prevent sale of strategic U.S.-owned companies to foreign-owned companies
  • Enact legislation to prevent corporations from avoiding the U.S. income tax by reincorporating in a foreign country

It is also critical that we not approve any new Free Trade Agreements, such as the Trans-Pacific Partnership and Trans-Atlantic Partnership that are currently proposed. The U.S. has a trade deficit with every one of its trading partners from NAFTA forward, so Free Trade Agreements have hurt more than helped the U.S. economy.

What States and Regions Could Do

State and local government can work in partnership with economic development agencies, universities, trade associations, and non-profit organizations to facilitate the growth and success of startup manufacturing companies in a variety of means:

Improve the Business Climate – Each state should take an honest look at the business climate they provide businesses, but especially manufacturers since they provide more jobs than any other economic sector. The goal should be to facilitate the startup and success of manufacturers to create more jobs. I recommend the following actions:

  • Reduce corporate and individual taxes to as low a rate as possible
  • Increase R&D tax credit generosity and make the R&D tax credit permanent
  • Institute an investment tax credit on purchases of new capital equipment and software
  • Eliminate burdensome or onerous statutory and environmental regulations

Establish or Support Existing Business Incubation Programs, such as those provided by the members of the National Business Incubation Alliance. Business incubators provide a positive sharing-type environment for creative entrepreneurship, often offering counseling and peer review services, as well as shared office or laboratory facilities, and a generally strong bias toward growth and innovation.

Facilitate Returning Manufacturing to America – The Reshoring Initiative,  founded by Harry Moser in 2010, has a  mission to bring good, well-paying manufacturing jobs back to the United States by assisting companies to more accurately assess their total cost of offshoring, and shift collective thinking from “offshoring is cheaper” to “local reduces the total cost of ownership.” The top reasons for U. S. to reshore are:

  • Brings jobs back to the U.S.
  • Helps balance U.S., state and local budgets
  • Motivates recruits to enter the skilled manufacturing workforce
  • Strengthens the defense industrial base

According to Mr. Moser, the Initiative has documented case studies of companies reshoring showing that “about 220 to 250 organizations have brought manufacturing back to the U.S….with the heaviest migration from China. This represents about 50,000 jobs, which is 10% of job growth in manufacturing since January 2010.”

State and/or local government could facilitate “reshoring” for manufa
cturer
s in their region by conducting Reshoring Initiative conferences to teach participants the concept of Total Cost of Ownership, how to use Mr. Moser’s free Total Cost of Ownership Estimator™, and help them connect with local suppliers.

Establish Enterprise Zones and/or Free Trade Zones: Enterprise Zones provide special advantages or benefits to companies in these zones, such as:

  • Hiring Credits – Firms can earn state tax credits for each qualified employee hired (California’s is $37,440)
  • Up to 100% Net Operating Loss (NOL) carry-forward for up to 15 years under most circumstances.
  • Sales tax credits on purchases of up to $20 million per year of qualified machinery and machinery parts;
  • Up-front expensing of certain depreciable property
  • Apply unused tax credits to future tax years
  • Companies can earn preference points on state contracts.

States located on international borders could also establish Foreign Trade Zones (FTZs), which are sites in or near a U.S. Customs port of entry where foreign and domestic goods are considered to be in international trade. Goods can be brought into the zones without formal Customs entry or without incurring Customs duties/excise taxes until they are imported into the U. S. FTZs are intended to promote U.S. participation in trade and commerce by eliminating or reducing the unintended costs associated with U.S. trade laws

What Individuals Could Do

There are many things we could do as individuals to create jobs and reduce our trade deficits and national debt. You may feel that there is nothing you can do as an individual, but it’s not true! American activist and author, Sonia Johnson said, “We must remember that one determined person can make a significant difference, and that a small group of determined people can change the course of history.”

If you are an inventor ready to get a patent or license agreement for your product, select American companies to make parts and assemblies for your product as much as possible. There are some electronic components that are no longer made in the U. S., so it may not be possible to source all of the component parts with American companies. There are many hidden costs to doing business offshore, so in the long run, you may not save as much money as you expect by sourcing your product offshore. The cost savings is not worth the danger of having your Intellectual Property stolen by a foreign company that will use it to make a copycat or counterfeit product sold at a lower price.

If you are an entrepreneur starting a company, find a niche product for which customers will be willing to pay more for a “Made in USA” product. Plan to sell your product on the basis of its “distinct competitive advantage” rather than on the basis of lowest price. Select your suppliers from American companies as this will create jobs for other Americans.

If you are the owner of an existing manufacturing company, then conduct a Total Cost of Ownership analysis for your bill of materials to see if you could “reshore” some or all of the items to be made in the United States. You can use the free TCO worksheet estimator to conduct your analysis available from the Reshoring Initiative at www.reshorenow.org. Also, you could choose to keep R&D in the United States or bring it back to the United States if you have sourced it offshore.

If enough manufacturing is “reshored” from China, we would drastically reduce our over $700 billion trade deficit in goods. We could create as many as three million manufacturing jobs, which would, in turn, create 9 – 12 million total jobs, bringing our unemployment down to 4 percent.

You may not realize it, but you have tremendous power as a consumer. Even large corporations pay attention to trends in consumer buying, and there is beginning to be a trend to buy ‘Made in USA” products. As a result, on January 15, 2013, Walmart and Sam’s Club announced they will buy an additional $50 billion in U.S. products over the next 10 years.

U.S. voters supported Buy America policies by a 12-to-1 margin according to a survey of 1,200 likely general election voters conducted between June 28 and July 2, 2012 by the Mellman Group and North Star Opinion Research. The overwhelming support has grown since prior iterations of the same poll – Buy America received an 11-to-1 margin of support in 2011 and a 5-to-1 margin in 2010. A survey by Perception Services International of 1400 consumers in July 2012, found that 76% were more likely to buy a U.S. product and 57% were less likely to buy a Chinese product.

As a consumer, you should pay attention to the country of origin labels when they shop and buy “Made in USA” products whenever possible. Be willing to step out of your comfort zone and ask the store owner or manager to carry more “Made in USA” products. If you buy products online, there are now a plethora of online sources dedicated to selling only “Made in USA” products. Each time you choose to buy an American-made product, you help save or create an American job.

In his book, Buying America Back:  A Real-Deal Blueprint for Restoring American Prosperity, Alan Uke, recommends Country of Origin labeling for all manufactured products that “puts control in the hands of American consumers to make powerful buying choices to boost our economy and create jobs,” as well as reduce our trade deficit. The labels would be similar to the labels on autos, listing the percent of content by country of all of the major components of the product. This Country of Origin labeling would enable American consumers to make the decision to buy products that have most of their content “made in USA.”

If every American would make the decision to buy American products and avoid imports as much as possible, we could make a real difference in our nation’s economy. For example, if 200 million Americans bought $20 worth of American products instead of Chinese, it would reduce our trade imbalance with China by four billion dollars. During the ABC World News series called “Made in America,” Diane Sawyer has repeatedly said, “If every American spent an extra $3.33 on U. S.-made goods, it would create almost 10,000 new jobs in this country.”

In conclusion, if we want to create more jobs, reduce our trade deficit and national debt, we must support our manufacturing industry so that it could once again be the economic engine for economic growth. Following the suggestions in this article could make the “Great American Job Engine” roar once again.

Google Glass Will Be American Made

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Tim Bradshaw
Google will manufacture Project Glass, its futuristic digital eyewear, in Silicon Valley, in a high-profile example of the return of electronics manufacturing to the US.
Google is working with Hon Hai Precision Industry, the Taiwanese contract manufacturer better known as Foxconn, to assemble the sci-fi headset at a facility in Santa Clara, California, according to people familiar with the company’s plans.

The decision to manufacture in California will boost President Barack Obama’s drive, set out in his State of the Union address, to ensure “the next revolution in manufacturing is ‘Made in America’”. In December, Apple chief executive Tim Cook pledged to invest $100m in American manufacturing. Foxconn has also said it is considering expanding its US operations in response to growing customer demands.

Glass is an ambitious example of so-called wearable computing, Silicon Valley’s latest gadget obsession. Its inbuilt camera is controlled by voice recognition software and can send photos and videos directly to the web, via a connected smartphone, while a small screen above the wearer’s right eye displays search results and other information.

The small scale, high cost and complexity of the project’s initial run makes it practical to base manufacturing operations near the search company’s Silicon Valley headquarters, according to people briefed on the plans.

Only a few thousand Google Glass devices will roll off the Californian factory line in the coming weeks, rather than the millions of iPhones and other electronics which Foxconn typically produces at its plants in China, where the vast majority of the world’s gadgets are made. It is also not clear how many people the facility will employ.

Google said on Wednesday that it would give 8,000 contest winners the opportunity to buy the $1,500 devices. Although no launch date has been set publicly, Glass is expected go on sale to the mass market later this year.

Manufacturing locally will allow Google’s engineers to be closely involved with the production process and provide more opportunities for last-minute fixes and for personal customisation.

Although many components are being sourced from Asia, final assembly will be done in Santa Clara. Foxconn and Google declined to comment.

Such moves may also blaze a trail for Silicon Valley’s resurgent community of hardware start-ups, which remain largely reliant on cheaper offshore manufacturing. As contract device makers scale up production for large clients such as Apple and Google, their prices will fall and provide capacity for smaller companies too.

Many of the people waiting to receive Glass include developers who ordered a pair at last June’s Google I/O event in San Francisco, as well as some handpicked Google partners. Some tech and media companies, including Evernote, Path and the New York Times, are already creating apps to work on the headset. The “Explorer Edition” of Glass currently being manufactured is likely to be unveiled at this year’s I/O.

Google’s first attempt at building its own hardware was last year’s aborted Nexus Q, a music and movie-streaming device that was also made in Silicon Valley. The physical design of the small spherical unit, which included touch sensors, precision-machined zinc housing and 33 LEDs, was widely praised. But Google pulled the unit from sale last August, just weeks after unveiling it, without providing any reason for the move.

Google’s previous hardware partners have primarily been other branded electronics companies such as Taiwan’s Asus and South Korea’s LG, with which it has developed different generations of the Nexus line of flagship Android smartphones and tablets.

Additional reporting by Sarah Mishkin in Taipei and Richard Waters in San Francisco

SOURCE:  Financial Times

Hottest Accessory for Spring? A Made in U.S.A. Label

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Jody Melto

Made in the U.S.A.

What used to be a patriotic rally cry of Appalachian and Rust Belt states (having grown up in a West Virginia steel-working family, I can say that) is now the socially-responsible and eco-friendly marketing campaign for a new trend of designers.
And tonight you can see two product lines for yourself.

D.C.-based designer Tim Neill will launch Red Hand, his new line of accessories for men, at theWonderland Ballroom (1101 Kenyon St NW in Columbia Heights) from 5:30-9 p.m.

And N.Y.-based designer Allison Parris is showcasing her stunning spring line of frilly, girly-girl party dresses at Room & Board (1840 14th Street NW) from 7- 9 p.m.

Two very different designers. Two very different product lines. One similar mission — producing unique, high-quality clothing and accessories with fair-wage stitching and socially-responsible thread counts. 

For both Neill and Parris, this is philosophy mixed with good business. They have identified a growing demographic — people who shop consciously.

“We are absolutely seeing a shift in consumer attitude,” adds Neill, whose Red Hand line focuses on men who are “bored with the mediocre products offered by many of the retail apparel chains and who can’t afford the premium stores or boutiques.”

“I think that people finally understand the repercussions of their buying decisions,” he adds.

Parris feels it’s a slowly growing trend. “I think little by little, as the economy gets better and people can afford it more, it will continue to swing further in that direction.”

She built her line “around the idea that ‘retaining moral values’ and ‘being able to wear beautiful, well-made clothing’ are not mutually exclusive actions.”

And to her fair wage is a “feel-good thing.”

“You want to know that your dress isn’t made by child labor and that the people making it are being treated fairly,” she explains.

Forget wonks, academics and think tanks. When discussing the problems of starting a business in the U.S., there’s no more knowledgeable source than someone actually engaged in the process. Neill sounds more like a Harvard economics professor than entrepreneur as he talks about getting Red Hand operational. No offense to entrepreneurs.

“The biggest challenge we had in making (our) product here,” he explains, “was identifying good and viable manufacturers to work with.” In fact, if he were president for a day, Neill would “fund and support institutions charged with pairing ideas and companies with viable manufacturers.”

On the lighter side. It’s fashion. Nobody wants to wear socially-conscious fashion if it sucks. Both product lines are fun, unique and inspired.

And if you think a night out with fashion does not a good date make … well, you’d be right.

But that’s okay.

Because tonight the men can drink a pint at Wonderland and peruse Neill’s belt buckles hand-crafted from auto parts and pharmaceutically-themed neckties and the women can succumb to Parris’s 1950s-inspired confections while being seduced by Don Draper. In their heads. Room & Board has just the right set design for that fantasy. Hopefully, they’ll be serving very dry martinis, a detail I could not confirm.

Although, if gift-buying is in your near future, I suggest you pick accordingly.

SOURCE:  Huffington Post

Reinvigorate America, One Tradesman At A Time

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Mediaplanet Publishing released its highly anticipated awareness campaign, “Employing America.” With the aim of educating readers about America’s skilled labor gap, Mediaplanet and industry leaders joined forces to encourage Americans to do their part in rebuilding America. The publication was distributed as a digital campaign as well as a special eight-page broadsheet section within select markets of USA Today, reaching well over 3 million readers.

Closing the skills gap

“The Skills Gap is not a mystery; it’s a reflection of what we value,” explains Mike Rowe, Host of Discovery Channel’s Dirty Jobs, and CEO of mikeroweWORKS, in the publication’s foreword. “And if we’re serious about closing the gap, we need to reconnect with that part of our workforce. We need to reinvigorate the trades. We need to confront the stigmas and stereotypes associated with skilled labor, and let go of this absurd belief that a four-year degree is the only viable way to acquire useful knowledge.”

Manufacturing in America

If every American were to spend just $64 a year on products made in the U.S., over 200,000 new jobs would be created. In a nation where the unemployment rate is still soaring, these numbers are startling. “Consumers should be concerned about buying American-made, not just because the products are safer and of higher quality, but because doing so creates jobs and minimizes our carbon footprint,” says Margarita Mendoza, founder of Made in America Movement.

In collaboration with American-made toy manufacturer K’Nex, Mediaplanet has launched a social media giveaway to promote the concept of “Made in America.” Readers are encouraged to submit an image of their favorite made in America product, and ten lucky readers will receive an American-made K’nex 50 Model building set. Further details on the giveaway can be found on Employing America’s digital campaign website.

Mediaplanet’s Campaign

In partnership with Air Products, All American Clothing, Bill Clinton, Caterpillar, Inc., Ford Motor Company, General Electric, Go Build Alabama, Haskell, IRWIN Tools, MikeRoweWORKS, The National Center for Construction Education and Research, Salary.com, SkillsUSA, Snap-on Tools, Made in America Movement and The Rodon Group/ K’nex, a call to action has been created to ensure that awareness is raised concerning the skilled labor gap.

The full report can be downloaded here.  Employing America

GOLDMAN SACHS: There Is No Sign Of An American Manufacturing Renaissance

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REUTERS/Robert Galbrait

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Sam Ro
Mar. 24, 2013
One of the big emerging economic stories in the world today is the American manufacturing renaissance.  This is the idea that low energy prices, increasing productivity, and rising costs overseas would invigorate the production of goods in the U.S.
Goldman Sachs’ Jan Hatzius acknowledges that much of the recent economic data seems to support the idea that U.S. manufacturing is improving.

However, Hatzius argues that all of the signs reflect a recovery that is “squarely cyclical,” not structural.  In other words, U.S. manufacturing has yet to demonstrate that there is a major long-term shift going on in the world.

“Evidence for a structural renaissance is scant so far,” writes Hatzius. “Measured productivity growth has been strong, but US export performance — arguably a more reliable indicator of competitiveness — remains middling at best. And at least so far, there is not much evidence for large positive spillovers from the U.S. energy cost advantage to broader manufacturing output.”

Hatzius takes a close look at export market shares because they are “relatively easy to measure and are an intuitive gauge.” Here’s what the data tells him:

The picture shows that U.S. exporters have only tended to gain share following significant dollar depreciations. There has been no discernible change in this relationship in recent years. If anything, U.S. export performance has tended to fall short of what one would have expected based on currency movements.
Hatzius considered the possibility that U.S. export gains were “obscured by an even bigger improvement in China’s performance.”  To address this, he considers trade among with just Europe

…U.S. export performance looks only middling even if we restrict our attention to European trading partners. Exhibit 6 compares real export growth for the U.S. and the Euro area, stripping out intra-Euro area trade in order to avoid contamination by the weakness in Euro area domestic demand. The two series continue to track one another closely, suggesting that both are driven by the global trade cycle as opposed to structural changes on one side of the Atlantic or another.
As we mentioned earlier, one of the pillars of the American manufacturing renaissance thesis is the low energy cost advantage.  But if this were true, the energy intensive industries would’ve expanded int he U.S.

But Exhibit 7 shows that we have not yet seen a material pickup in output in the parts of the manufacturing sector that should benefit most from low natural gas prices, such as aluminum, steel, plastics, basic chemicals, and fertilizer and other agricultural products. At least so far, the benefits from the increase in U.S. energy production seem to have been confined to the direct effects on output and income.
Hatzius isn’t intending to poo-poo on American manufacturing altogether. He expects the sector to outperform, and he also expects it to be a driver of job growth.

“But we believe the reason for this will be broad economic improvement that benefits all sectors, especially the more cyclical ones, not a structural U.S. manufacturing renaissance,” he writes.

"Made in America?" Not Any Time Soon

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Robin Lewis
Allow me to be the group historian for a minute. Does anyone remember, in 1984, the “Crafted with Pride in the U.S.A.” advertising campaign, spearheaded by the late Roger Milliken, and funded by a consortium of fiber, chemical and textile companies?  This was supposed to have instilled enough patriotism in the consumer to buy goods made in America at a furious enough rate to keep manufacturing here on our soil. 
In the early ‘80s there were enough major industry players who believed research findings about consumers’ apparent intentions that they launched that consumer marketing and advertising campaign.  The objective, of course, was to get consumers to buy apparel made in the U.S., and thus sustain the viability of keeping our manufacturing base stateside.  

The French had done it — in fact, still do to some degree – provide incentives to both manufacturing and consumption to remain in the patrimoine. But they have a country the size of Texas, with a largely homogeneous population that’s controllable by the benign socialist system in place there. 

Four years and hundreds of millions of 1970 dollars into that “Crafted with pride in U.S.A.” campaign, it was deemed an utter failure. The sound of soft gloating giggles began issuing from Asia. Occasionally one would see products with “Made in USA” stamped on them – Usa being the name of a factory town in Japan. Manufacturing left America, and consumers, who months earlier had avidly responded to research questionnaires that they would favor apparel made in the U.S. and would in fact pay a premium for it, began to get comfortable with clothing and other goods made elsewhere.

That comfort has extended right into the Internet age, where everything and anything can be globally sourced by anyone, at any time. Consumers have now gained so much power that retailers feel real pressure not just to keep from raising their prices, but to consistently lower them.

“Those who cannot remember the past are condemned to repeat it,” wrote the philosopher George Santayana. A recent study conducted by the Boston Consulting Group, as well as an earlier survey by the NPD Group in the fall of last year, found that upwards of three quarters of consumers surveyed thought it was extremely or somewhat important to buy apparel made in the U.S., while about 70 percent said they were willing to pay variously higher prices for said goods.

Hogwash, says I.  Not the research methods. Not even the accuracy of the findings. 

They’re essentially the same findings as those from the research conducted in the 1970s — that consumers would favor apparel made in the U.S., and indeed, would pay a premium for it. It was the actual behavior of these same consumers that showed up the research as hogwash. The goal of that research and its subsequent consumer marketing campaign was to save the industry from moving offshore.  

Most of the retailers during that period were reluctant to sign on in support of the program.  Why? Forget the research findings, the consumer’s buck stops at their cash registers. They were smart enough to know that if their blue jeans had a ”Crafted With Pride in the U.S.A.” label, but sold for five bucks more than their competitor’s “Made in China” jeans, then no bucks would be stopping at their registers.

So, bye-bye manufacturing.

Ironically, the findings from the current BCD and NPD research would like us to believe that we can get manufacturing back here again. 

Are We Condemned to Repeat History?

If millions were lost, and the campaign to save the manufacturing industry failed in the ‘70s, based on the belief that consumers would change their behavior due to a patriotic “call to duty” in favor of getting more for less, what is it that makes this time any different?  And back then it was to try to save much of what was here. Can you imagine what the cost might be to get back even part of what is gone? 

Are we to believe consumers are more patriotic today, and have the mental – or economic — bandwidth to connect the dots promising more jobs if they spend a little extra for “Made in America?” Or, as evidenced by American consumers’ obsessive compulsion to find lower and lower prices — admittedly tied to their own shrinking wallets — when confronted with giving up one item on their shopping list to pay a little more for some ill-defined altruistic American future, what do you think our price obsessed consumer is going to do?

If I have to tell you, you don’t belong in retail.

We all say we’re going to do something and then do the opposite.  And, why wouldn’t any red blooded American consumer say they would favor American-made goods and pay more for them?  After all, to answer that way doesn’t cost them a penny, and they get to feel civic pride to boot.

So, could this possibly be retro sensationalism that’s being drummed up by these research guys and the media? Like this is the next big trend in consumer behavior?  That somehow consumers are, all of a sudden and after four or five frightful years, concerned with our economy?  Most do not care, nor could they know, what “the economy” is all about.  To them the economy is their wallet.

On the supply side, there are retailers and brands that over the past 50 years have successfully built more stores and more stuff than the planet will ever need, and who are wildly slashing prices to steal just one more smidgen of a share of market that isn’t growing. Are they really going to suddenly build costs back into their products, based on what some consumers say they would do? Not likely. What is likely is a minimum wage increase.  As one of my colleagues said, “The President wants to raise the minimum wage to nine bucks? Calculate what that will do to a pair of Lee jeans.” 

However deftly these surveys may play into the current political and economic narrative, the reality is that brands and retailers that act on the belief that consumers are going to do the same as what they say they would do are lemmings jumping off of a cliff, in my humble opinion.

Yes, there are luxury and designer segments whose customers, even today, can afford to pay higher prices for goods made in the U.S.  And there are other product niches and brands such as American Apparel, that are building their value, at least in part, around U.S. made goods or “insourcing,” as it’s being called.  But taken together, all of these “patriots” comprise just a tiny sliver of the total.

On another front, all of the press that Walmart has been getting from beating their drum about committing to source $50 billion worth of goods in the U.S. over the next ten years is just that: “beating a drum.” One wonders how much of a PR stunt this is. $50 billion over ten years is $5 billion a year.  They sell more than $400 billion worth of goods per year.  And, the $5 billion they commit to U.S. sourcing – that’s a whopping one-and-a-quarter percent of their annual sales — will be spread over apparel, home, games, pet supplies and high-end electronics. 

Doesn’t sound like a game changer to me.  And the minute their core consumers reject even a penny added on to Walmart’s promise of “lowest price always,” the behemoth from Bento
nville
will be beating it back to Bangladesh as fast as you can say “outsourcing.” 

There’s one time I can remember when this call to patriotic spending had its intended results.  It was right after 9/11, when New York City Mayor Rudy Giuliani, backed up by the president, implored people to come to New York (or stay here) and spend money, to reignite not only the economy but also the morale of the city’s merchants, residents, and tourists.

Nevertheless, I contend that this article outlines a realistic assessment of where we find ourselves nationally today, as retailers and as consumers.  It would be great if consumers were really imbued with enough patriotic emotion that they would sacrifice getting more for less, so that the U.S. could bring back and expand its manufacturing base, thus creating more jobs and regaining a robust and growing economy.  Should we, or can we, take a lesson from the French?  

I say not any time soon.

SOURCE:  Retailing Today

Robin Lewis is CEO of retail industry strategy newsletter, The Robin Report, and is co-author of the book The New Rules of Retail.

Longaberger Transitions To American Made Only

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March 24, 2013
ZANESVILLE — The world’s largest American flag will be unfurled this summer to help celebrate the Longaberger Co.’s 40th anniversay and its transition to strictly American-made products
Brenton Baker, director of corporate communications, said the company expects to create 500 new positions in the U.S. as a result of Project Eagle. The display of the 128,775-square-foot flag is just one of many events set to promote the project.

“Our company was built on American craftsmanship,” Baker said. “Our baskets have always been made right here in Ohio. We feel that it’s important to bring all of our production back to America.”

The company that began by solely producing baskets 40 years ago has morphed into a home goods store that produces pottery, woodcrafts, raw iron, glassware and other home accents aside from its famous baskets.

In the early 2000s, Longaberger moved its pottery manufacturing overseas because of an increased demand.

Now, CEO Tami Longaberger has decided to bring production back to its roots here in America within the next several years.

“It won’t be easy,” Longaberger said during a keynote speech in July 2012 in Columbus. “But it’s going to be worth every ounce of work we put into it.”

The festivities will be June 14 and 15 when Longaberger hosts the Great American Picnic. Aside from the world-record flag, there will be live entertainment, food and shopping for everyone in attendance. Baker expects it will be “like a hometown picnic” with people from towns across the U.S. gathered at the Longaberger Homestead in Frazeysburg.

There also will be a specially crafted red-white-and-blue basket auctioned off, with proceeds going to the Fisher House to support American service members and their families by allowing them to be close to loved ones during hospitalization.

“The public has rallied around this project,” Baker said. “It’s creating American jobs and supporting American families. That’s something everyone can get behind. I think that unified message is resounding around the country.”

Suntactics Solar Chargers Made in America with Zero Defects

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Press Release
Customers want long-term value and that is why Suntactics manufactures its solar chargers in America to the highest quality control standards in the industry.
“At Suntactics, we design and build our durable, reliable and hassle-free solar devices for long-term customer value and not obsolesce,” said Dean Sala, Suntactics Founder and CEO. “Made in America with zero defects is the result of our total commitment to precision and refinement in all our design and manufacturing processes”.

  1. Suntactics sChargers use state of the art circuitry design optimized to assure the device is always charging at an optimal rate.
  2. All Suntactics’ solar chargers are manufactured to its’ highest quality control standards with a tenacious, “marine-grade” construction process to assure long life under continual exposure to adverse weather conditions.
  3. Suntactics sChargers’ simplicity in design makes them hassle-free and effortless to use.

Many remote device solar charger manufacturers do not design and manufacture their solar chargers for durability and reliability. They are entirely focused on cost; “low-cost off-shore companies” manufacture their shoddy solar chargers where zero defects is a foreign concept. Their customers have expressed their concerns in the reviews of their solar chargers and, in several situations, have replaced their defective solar chargers with Suntactics solar chargers.

“Suntactics is more concerned about our long-term relationships with our customers,” said Dean Sala, Suntactics Founder and CEO. “And our customers continue to express their appreciation about the quality of our sCharger5 and sCharger12 solar chargers”. 

  • “It is a very well made unit, not cheaply made at all”.
  • “Buy this made in USA product if you want something that works”.
  • “The charger works great, is compact and easy to carry/store and it’s “green”.    What more could you ask for? I couldn’t be happier with mine”.
  • “It’s basically a one-time investment that will pay for itself in battery use and power use”.


Suntactics has set the quality and value standard for portable solar chargers with over 5,000 Suntactics solar chargers Made in America with zero defects.

  • The dependable and compact sCharger-5 for solar charging smartphones like the iPhone5 and Galaxy S3
  • The more powerful and faster dual-port sCharger-12 for multiple devices including tablets, phones or any other USB device
  • Truly environmentally responsible products designed and Made in America for long-term customer value and everlasting usefulness.

About Suntactics
Suntactics focuses on portable solar and off grid solar energy products. Their current products are a unique 5-watt handheld solar charger called the sCharger-5 for solar charging smartphones like the iPhone and powerful dual port 14-watt solar charger called the sCharger-12 for solar charging multiple remote devices including tablets like the iPad. These compact high power and durable solar power chargers meet the needs for a wide range of portable devices. The units are manufactured in the USA at Fastrak, a veteran owned contract manufacturer. Suntactics is headquartered in San Jose, CA.

SOURCE:  PRWeb

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