Rogers is famous for Daisy BB guns but it will soon be home to another toy maker, Redman & Associates, who announced a $6.5 million investment to relocate its ride-on toy manufacturing business from Shanghai to Northwest Arkansas over the next three years.
Gov. Mike Beebe, Walmart U.S. CEO Bill Simon and officials with Redman made the announcement Monday (Oct. 7) in Rogers.
Mel Redman, a former Wal-Mart executive and Redman CEO, told a room full of economic leaders that his firm had been looking at on-shoring its small manufacturing center as the economics are now favoring “Made in the USA.”
“This would not have happened if Wal-Mart had not made its $50 billion commitment to source American-made products over the next 10 years. That gave me the guts to step out and do it,” Redman said during Monday’s press conference.
Wal-Mart officials announced on Jan. 15, 2013, a pledge to purchase in the next 10 years an additional $50 billion in U.S.-made goods. Company officials have said they hope to boost U.S. manufacturing – often referred to as “onshoring” – by purchasing more sporting goods, apparel basics, storage products, paper products, textiles, furniture and higher-end appliances.
Beebe was one of eight state governors to attend the “U.S. Manufacturing Summit” in Orlando, Fla., that was held Aug. 22-23. The event connected economic development officials from 36 states with about 600 Wal-Mart suppliers and retail vendors.
Redman said he attended the recent supplier/manufacturing conference held in Orlando by Wal-Mart.
“We met with the state economic team about shared our plans and they took off like a freight train after that,” Redman said.
This is the first score for Arkansas since Wal-Mart’s manufacturing conference which brought together suppliers and state economic teams to discuss bringing manufacturing jobs back to the U.S.
Redman said he operates a sales office in Bentonville that employs 16 people. But moving the manufacturing here will create 17 jobs the first year, ramping up to 74 by the time the entire operation comes online in Rogers.
A study by the University of Arkansas estimates the $18.55 per hour average wage created from this business will pump $3 million back into the local economy once it’s fully operational.
The UA study found that every new manufacturing job created will support four other jobs that provide services to the toy maker.
“We buy a lot of cardboard boxes and print lots of labels. Local companies here will get that business,” Redman said.
He said when the Rogers plant is fully operational and shipping from Northwest Arkansas instead of Long Beach, Calif., his firm will save 2.2 million inland miles and slash $7 million in ocean freight expenses, by far its largest annual expense. It will also cut seven days out of the supply chain, making for a more efficient overall operation.
Gov. Beebe said there is not a better story than seeing a local entrepreneur who could have retired long ago but instead invests in creating new jobs.
“This is just the tip of the iceberg. We are going to see other companies follow this lead because people do want to buy American-made products if the price and quality are comparable,” Beebe said.
Beebe also credited Wal-Mart for stepping out to help facilitate suppliers and economic teams to make success stories like this happen.
“I have said for a long time that a country can’t be great unless it makes things, we are seeing these jobs come back because consumers want to buy manufactured goods made in America,” Beebe said.
“Wal-Mart’s commitment to restoring U.S. manufacturing jobs and Redman & Associates’ decision to bring these jobs to the U.S. allow more Americans to do just that. With rising business costs overseas, Arkansas has the ideal location and workforce for companies looking to manufacture and distribute products throughout the U.S. and the world,” he said.
Rogers Mayor Greg Hines said the new facility will be located at 1300 N. Dixieland Road in an existing 275,000 square-foot building.
“Mel Redman told me after touring the building that he could not have built one more suitable for his manufacturing needs,” Hines said.
Redman will produce 6-volt battery powered ride on toys and believes they can source all of the raw products in the U.S. The battery itself is the most challenging. Redman will relocate its plastic molding business to Rogers, which makes the main body of these ride-on toys.
The toys made locally will feature characters from Disney and Marvel franchises including Disney Princess, Classics, Disney•Pixar and Spider-Man. Production should begin in early 2014. Redman is licensed by Marvel Characters B.V., and Redman produces Disney character ride-on toys for Wal-Mart under Wal-Mart’s license with Disney.
Simon said the response he and other Walmart officials are hearing from their supplier community about this initiative has been overwhelmingly positive.
“It is making economic sense. We continue to hear about smaller suppliers adding a few U.S. jobs here and there, but this is the first of we hope are several announcements for manufacturing onshoring,” Simon said.
He said this region like many others could become clusters for certain like types of manufacturing. For instance Redman requires plastic molding, which could open the door for others in that business. Or, when a textile company that makes socks comes back onshore, other garment companies could also cluster there because of shared sourcing power.
Grant Tennille, executive director for the Arkansas Economic Development Commission, said the state did give Redman a few incentives to move their manufacturing operation from Shanghai to the Natural State. Those incentives included $2 million that goes toward building and equipment costs for Redman, and the Arkansas Advantage 1% state tax credit on wages paid for five years. In addition, Redman will also get a sales tax rebate on manufacturing equipment purchases relating to its startup.
Tennille said the tax credits occur retroactively. Redman said the incentive package helped to seal the deal.
Tennille said there are plenty of other companies like Redman that have the relationship with Wal-Mart but have been outsourcing their manufacturing arm. Those are some of the companies the state is targeting for onshore efforts.
Raymond Burns CEO of Rogers Lowell Chamber of Commerce, said Monday’s announcement is symbolic of what is happening across the country as manufacturers across many segments are finding economic incentives to make their products in the U.S.
“We hope to see more of it here, that’s for sure,” Burns said.
Redman & Associates is a family-owned business founded in 1995. The company started as a consulting firm, and now has a diversified portfolio that includes production through all stages of product design, production, logistics, store planning, and into the hands of the consumer. The company produces Monster TRAX ride-on toy vehicles, Zumu three-in-one bike trailer/jogg
er/
strollers and a variety of six-volt ride on toys licensed through Disney.
More Jobs Announced From Wal-Mart Onshoring Effort
in Uncategorized/by MAM TeamBentonville-based Wal-Mart sponsored the “U.S. Manufacturing Summit” in Orlando, Fla., that was held Aug. 22-23. The event connected economic development officials from 34 states with about 500 Wal-Mart suppliers and retail vendors.
Arkansas Gov. Mike Beebe was one of eight state governors to attend. The effort has already produced one success for Arkansas. Redman & Associates announced Oct. 7 a $6.5 million investment to relocate its ride-on toy manufacturing business from Shanghai to Northwest Arkansas over the next three years.
The announcement Thursday was held at the SelectUSA 2013 Investment Summit with Walmart U.S. President and CEO Bill Simon joining U.S. Department of Commerce Secretary Penny Pritzker to discuss the manufacturing moves to the U.S.
More than 1,200 attendees from nearly 60 countries around the world attended the SelectUSA event held in Washington, D.C., and coordinated by the U.S. Department of Commerce.
According to a statement from Wal-Mart, Elan-Polo, Louis Hornick & Company and EveryWare Global will produce footwear, curtains and glassware, respectively. The three suppliers will create a combined 385 jobs with the new manufacturing operations.
“Today’s announcement is a great example of the progress that’s being made, and it highlights opportunities that exist for manufacturers to invest in the USA by re-shoring or expanding their manufacturing in America,” Simon said in the statement. “Companies, government officials and industry leaders are working together to increase manufacturing, and these efforts are helping more Americans get into good-paying jobs and more businesses reinvest in the U.S. economy.”
The statement provided the following details about the three companies.
Wal-Mart said in the statement that as a result of their onshoring effort “manufacturers have committed to create more than 1,600 jobs and invest more than $100 million in industries that include socks, televisions, light bulbs and hardware. Factoring in today’s announcement, more than 600 of those job commitments have been announced since Walmart’s U.S. Manufacturing Summit.”
In addition to the Redman move to Rogers, the new operations include:
It will take many more announcements to boost the U.S. and Arkansas manufacturing sectors.
Historically, U.S. manufacturing sector employment has ranged between 19 million and 17 million. It reached a high of 19.553 million jobs in June 1979. Sector employment has been stuck below 12 million since May 2009. Prior to May 2009, the last time sector employment was below 12 million was May 1941. The sector employed an estimated 11.963 million as of September, up slightly over the 11.925 million in September 2012.
The U.S. Bureau of Labor Statistics estimated there were 154,700 manufacturing jobs in Arkansas during August 2013. Employment in the sector is down 24.2% compared to August 2003, and is down more than 37% compared to the sector high of 247,300 set in February 1995.
Toy Firm To Invest $6.5 Million, Add 74 Jobs in Rogers
in Uncategorized/by MAM TeamMel Redman, a former Wal-Mart executive and Redman CEO, told a room full of economic leaders that his firm had been looking at on-shoring its small manufacturing center as the economics are now favoring “Made in the USA.”
“This would not have happened if Wal-Mart had not made its $50 billion commitment to source American-made products over the next 10 years. That gave me the guts to step out and do it,” Redman said during Monday’s press conference.
Wal-Mart officials announced on Jan. 15, 2013, a pledge to purchase in the next 10 years an additional $50 billion in U.S.-made goods. Company officials have said they hope to boost U.S. manufacturing – often referred to as “onshoring” – by purchasing more sporting goods, apparel basics, storage products, paper products, textiles, furniture and higher-end appliances.
Beebe was one of eight state governors to attend the “U.S. Manufacturing Summit” in Orlando, Fla., that was held Aug. 22-23. The event connected economic development officials from 36 states with about 600 Wal-Mart suppliers and retail vendors.
Redman said he attended the recent supplier/manufacturing conference held in Orlando by Wal-Mart.
“We met with the state economic team about shared our plans and they took off like a freight train after that,” Redman said.
This is the first score for Arkansas since Wal-Mart’s manufacturing conference which brought together suppliers and state economic teams to discuss bringing manufacturing jobs back to the U.S.
Redman said he operates a sales office in Bentonville that employs 16 people. But moving the manufacturing here will create 17 jobs the first year, ramping up to 74 by the time the entire operation comes online in Rogers.
A study by the University of Arkansas estimates the $18.55 per hour average wage created from this business will pump $3 million back into the local economy once it’s fully operational. The UA study found that every new manufacturing job created will support four other jobs that provide services to the toy maker.
“We buy a lot of cardboard boxes and print lots of labels. Local companies here will get that business,” Redman said.
He said when the Rogers plant is fully operational and shipping from Northwest Arkansas instead of Long Beach, Calif., his firm will save 2.2 million inland miles and slash $7 million in ocean freight expenses, by far its largest annual expense. It will also cut seven days out of the supply chain, making for a more efficient overall operation.
Gov. Beebe said there is not a better story than seeing a local entrepreneur who could have retired long ago but instead invests in creating new jobs.
“This is just the tip of the iceberg. We are going to see other companies follow this lead because people do want to buy American-made products if the price and quality are comparable,” Beebe said.
Beebe also credited Wal-Mart for stepping out to help facilitate suppliers and economic teams to make success stories like this happen.
“I have said for a long time that a country can’t be great unless it makes things, we are seeing these jobs come back because consumers want to buy manufactured goods made in America,” Beebe said.
“Wal-Mart’s commitment to restoring U.S. manufacturing jobs and Redman & Associates’ decision to bring these jobs to the U.S. allow more Americans to do just that. With rising business costs overseas, Arkansas has the ideal location and workforce for companies looking to manufacture and distribute products throughout the U.S. and the world,” he said.
Rogers Mayor Greg Hines said the new facility will be located at 1300 N. Dixieland Road in an existing 275,000 square-foot building.
“Mel Redman told me after touring the building that he could not have built one more suitable for his manufacturing needs,” Hines said.
Redman will produce 6-volt battery powered ride on toys and believes they can source all of the raw products in the U.S. The battery itself is the most challenging. Redman will relocate its plastic molding business to Rogers, which makes the main body of these ride-on toys.
The toys made locally will feature characters from Disney and Marvel franchises including Disney Princess, Classics, Disney•Pixar and Spider-Man. Production should begin in early 2014. Redman is licensed by Marvel Characters B.V., and Redman produces Disney character ride-on toys for Wal-Mart under Wal-Mart’s license with Disney.
Simon said the response he and other Walmart officials are hearing from their supplier community about this initiative has been overwhelmingly positive.
“It is making economic sense. We continue to hear about smaller suppliers adding a few U.S. jobs here and there, but this is the first of we hope are several announcements for manufacturing onshoring,” Simon said.
He said this region like many others could become clusters for certain like types of manufacturing. For instance Redman requires plastic molding, which could open the door for others in that business. Or, when a textile company that makes socks comes back onshore, other garment companies could also cluster there because of shared sourcing power.
Grant Tennille, executive director for the Arkansas Economic Development Commission, said the state did give Redman a few incentives to move their manufacturing operation from Shanghai to the Natural State. Those incentives included $2 million that goes toward building and equipment costs for Redman, and the Arkansas Advantage 1% state tax credit on wages paid for five years. In addition, Redman will also get a sales tax rebate on manufacturing equipment purchases relating to its startup.
Tennille said the tax credits occur retroactively. Redman said the incentive package helped to seal the deal.
Tennille said there are plenty of other companies like Redman that have the relationship with Wal-Mart but have been outsourcing their manufacturing arm. Those are some of the companies the state is targeting for onshore efforts.
Raymond Burns CEO of Rogers Lowell Chamber of Commerce, said Monday’s announcement is symbolic of what is happening across the country as manufacturers across many segments are finding economic incentives to make their products in the U.S.
“We hope to see more of it here, that’s for sure,” Burns said.
Redman & Associates is a family-owned business founded in 1995. The company started as a consulting firm, and now has a diversified portfolio that includes production through all stages of product design, production, logistics, store planning, and into the hands of the consumer. The company produces Monster TRAX ride-on toy vehicles, Zumu three-in-one bike trailer/jogg
er/
strollers and a variety of six-volt ride on toys licensed through Disney.
Industry Expert: Economy Turning A Corner
in Uncategorized/by MAM TeamKorzenik, a 27-year industry veteran and a frequent guest on CNBC’s “Closing Bell” program, said the economic downturn of 2008-09 might not have been “your grandfather’s recession, but it was your great- great-grandfather’s recession”
“The kind of financial disaster that we weathered in 2008 and 2009 used to occur in the United States every 10 or 12 years,” he said “But it primarily occurred in the 19th century and parts of the 20th century. Economists called it a financial panic. What was abnormal in ’08 and ’09 was that we had a 19th century recession.”
That said, Korzenik thinks we are turning a corner.
“There have been some structural changes in the U.S. workforce,” he said.
If you lose your job in a recession it takes you longer to get back to work, Korzenik said. Usually it takes 15 to 20 weeks on average for people to get back in the workforce but in this recession, people stayed out of work for 40 weeks or more.
“We’re starting now to get some resolution from this because we’re through the pipeline of people exhausting their unemployment benefits and making tough choices to return into the workforce,” Korzenik said. “This is the essence of the journey to normal.”
Housing and construction market is also on a comeback and the acceleration is continuing, Korzenik said.
Children of baby boomers are moving out of their parent’s homes. It was delayed during 2008-09 downturn. Korzenik called it “getting junior out of the basement.”
Some of those “juniors” may only be renting but others are buying homes. Korzenik also said there was not a lot of hiring of young people during the recession, but that has changed. Their unemployment rate was above the national average but now it’s below.
“This group has seen enormous gains,” he said.
Korzenik said another driver of economic growth is the reshoring of manufacturing in the United States. The days of sending jobs overseas is changing and makers of heavier items are moving back to the U.S. Korzenik said Whirlpool has opened its first manufacturing plant in the U.S. in 30 years.
“It’s important for the creation of new jobs,” he said. “Manufacturing jobs may not pay what they paid at their peak, but they still pay more than service sector jobs.”
Korzenik said manufacturing jobs have what Congress calls “a high multiplier effect,” which means they tend to create other jobs in the economy.
Additionally, there has been a profound energy revolution to extent that the U.S. has overtaken Russia as the largest energy producer of the world.
“Ten years ago this was unthinkable,” Korzenik said. “It’s one of the drivers of manufacturing because energy in the United States is cheaper.
Korzenik also talked about the movement to natural gas in vehicles – something that’s becoming widespread with trucking fleets across the country.
Despite the apparent journey to normal, Korzenik was reminded of the proverb “a man plans and God laughs” – which means things can go wrong. Those things include inflation risks, currency debasement and inflation.
Wal-Mart In Projects To Make Shoes, Curtains, Jars in U.S.
in American Made/by MAM Team“It takes a lot of entrepreneurship; it takes a lot of innovation; it takes a lot of conviction to make that decision to take that step to invest capitol here,” said Simon.
Elan-Polo Inc. will start production of injection-molded footwear in March at a factory in Hazelhurst, Georgia. The company previously made the shoes overseas.
At the press conference Elan-Polo CEO Joe Russell cited “support and encouragement” from Wal-Mart, which it has been supplying with goods for 35 years.
EveryWare Global Inc. will produce canning jars for Wal-Mart at its Monaca, Pennsylvania, facility, establishing a new made in the U.S. product line.
And Louis Hornick and Co., a Wal-Mart supplier for four decades, will establish a new facility in Allendale County, South Carolina, to make window coverings and home textiles.
“Our next goal is to encourage other businesses just like these to step up to the plate,” Pritzker said.
Thursday’s announcement was part of Wal-Mart’s pledge, announced in January to buy an additional $50 billion in U.S.-made products over the next decade.
In August, the company held a “manufacturing summit” attended by more than 500 suppliers from 34 states clamoring to get a slice of the action.
Reuters reported in September that in advance of Wal-Mart’s patriotic pledge, many of the company’s long-time suppliers had already decided to produce in the United States as rising wages in China and elsewhere eroded the allure of offshore production.
It Takes More than Economics 101 to Compete With China
in Uncategorized/by MAM TeamYet these discussions, as well as the reports and studies they often cite, are almost always purely economic cost analyses. They estimate future wages here and abroad, worker productivity and transportation costs, and they conclude that the manufacturing differences between the United States and Asia are diminishing. They then extrapolate these trends far enough into the future that going to Asia seems no longer worth the trip.
Non-market factors are given at most a minimal mention in many arguments that favor reshoring, as it is called, of Chinese manufactured goods. But China’s exchange rates, as we know, are set by its government, not by markets. The massive government subsidies of land, energy and technology, in addition to low- or no-cost loans, are barely mentioned. These are, however, the levers that have catapulted Chinese industries into global prominence in a very short span of years. And these government actions are not going away; if anything, they are increasing.
Americans are assured, based on flawed analysis, that when U.S. companies find it cheaper to make certain goods domestically, they will do so. What is overlooked in reaching that much-wished-for conclusion is that the Chinese, following the example of other Asian nations, simply do not allow important outcomes to be determined in that way.
China did not get to where it is today by allowing natural economic forces to decide the outcome. The reality is much closer to the exact opposite. An industry is targeted, and then the economic forces needed to obtain a dominant position — including subsidies, special tax rates, exchange rates and technology agreements — are put in place. This fundamental reality cannot be ignored.
One report I am particularly fond of, from the respected Boston Consulting Group, is powerfully titled “Made in America, Again.” The cover is a pleasure for any patriot to see: It is simply a large red, white and blue American flag with small figures unrolling the red stripes, while others check the stripes’ exact locations before fixing them into place. The cover graphically and dramatically suggests the glorious return of U.S. manufacturing.
However, what is inside the report is much less colorful but far more realistic. It concludes that if the United States maintains a “flexible” labor force and a good investment climate, it will become “increasingly attractive” for those who want to stop manufacturing goods in China that are consumed in the United States — attractive, that is, for those who, for one reason or another, find other countries in Southeast Asia unattractive.
This is the feeble manufacturing renaissance promised in the report. To get to this rather wishy-washy conclusion, all sorts of leaps of faith are required both in this specific report and in many similar analyses. One must accept that there will be double-digit yearly increases in Chinese wages. One must accept that American workers will remain more productive than Chinese workers. One must be willing to equate U.S. subsidies — few and far between and tiny as they are — with those employed by the Chinese government. And one must believe that the relatively few small manufacturing plants planning to move back to the United States show that forces are in place to close a yearly manufacturing trade gap measured today in the hundreds of billions of dollars.
But most of all, despite the evidence of recent history, there is a tacit assumption that the Chinese government would simply stand by and let these happy outcomes happen. This is unlikely; the Chinese government does not share our pure and simple faith in the unguided operation of markets.
That China adheres to its system is not surprising; its system has been working for it. What is more surprising is that our faith in our own system is so ingrained that we continue to believe in its benign results even in the absence of the free markets and free trade conditions on which those conclusions are based.
A real manufacturing renaissance in America — at least one based on reshoring from China — is not something we can expect. Forecasts that reach that much-desired conclusion by simply extrapolating cost analyses into the future are not realistic. There is far too much that China and other countries can do to shape the outcome. We would do better to consider what we can realistically do in today’s mercantilist world rather than continue to act as if we were living in a textbook world, a world shaped only by market forces.
Ralph Gomory
Research Prof. NYU, Pres. Emeritus, Alfred P Sloan Foundation, Former IBM SVP Science-Tech
Ralph Gomory was born May 7, 1929, in Brooklyn Heights, New York. He graduated from Williams College in 1950, studied at Cambridge University, and received his Ph.D. in mathematics from Princeton University in 1954. Gomory then served in the Navy (1954-57) and then was a Higgins Lecturer and Assistant Professor of Mathematics at Princeton before joining IBM’s newly formed Research Division in 1959 as a research mathematician.
At IBM Research in the early 1960’s, Gomory published papers with Paul Gilmore on the knapsack, traveling salesman and cutting-stock problems, and with T. C. Hu on flows in multi-terminal networks and continua. In the late 1960’s, he developed the asymptotic theory of integer programming and introduced the concept of corner polyhedra. In the early 1970’s, he collaborated with Ellis Johnson in investigating subadditive functions related to corner polyhedra that could also play a role in producing cutting-planes.
Gomory served as Chairman of IBM Research’s Mathematical Sciences Department from 1965-67 and 1968-70 during an important period of its growth and evolution. This period saw the beginning of Samuel Winograd’s work on limits of algorithms and of Benoit Mandelbrot’s work on fractals.
Gomory became Director of Research for IBM in 1970, with line responsibility for IBM’s Research Division. During his 18 years as Director of Research the Research Division made a wide range of contributions to IBM’s products, to the computer industry, and to science. The Zurich Research Laboratory did the work that resulted in two successive Nobel Prizes in physics, Yorktown Heights Research was the birthplace of what is now known as RISC architecture, and San Jose was the birthplace of the concept, theory and first prototype of relational databases.
Gomory, who had become the IBM Senior Vice President for Science and Technology retire
d f
rom IBM in 1989 and became President of the Alfred P. Sloan Foundation. During his tenure as President he led the foundation into a long list of fields relevant to major national issues. The foundation pioneered in the field of on-line learning supporting this work before there was even a public Internet, and then supported its growth to more than three million people taking courses for credit. They started the now widespread program of industry studies, and engaged a major program advocating a more flexible workplace. The foundation developed a novel and successful approach to the problem of producing minority PhD’s in scientific and technical fields. The foundation was early in perceiving the threat of bioterrorism and was active in that area for years before the events of 9/11. On the scientific side the foundation supported the widely recognized Sloan Sky Survey, which has made major contributions to the problem of dark energy and initiated a major worldwide effort to survey life in the oceans known as the Census of Marine Life. In December 2007, after 18 years as President, Gomory retired from the foundation and became a Research Professor at New York University’s Stern School of Business.
Gomory has served in many capacities in academic, industrial and governmental organizations. He was a Trustee of Hampshire College from 1977-1986 and of Princeton University from 1985-1989. He served on the President’s Council of Advisors on Science and Technology (PCAST) from 1984 to 1992, and again from 2001 to 2009. He served for a number of terms on the National Academies’ Committee on Science, Engineering and Public Policy (COSEPUP). He has recently joined STEP, the Board on Science Technology and Economic Policy of the National Academies.
Gomory has been a director of a number of companies including the Washington Post Company and the Bank of New York. He is currently a director of Lexmark International, Inc., and a small start-up company. He was named one of America’s ten best directors by Director’s Alert magazine in 2000.
Gomory has been elected to the National Academy of Sciences, the National Academy of Engineering, and the American Philosophical Society. He was subsequently elected to the Councils of all three societies. He has been awarded eight honorary degrees and many prizes including the Lanchester Prize in 1963, the Harry Goode Memorial Award of the American Federation of Information Processing Societies in 1984, the John von Neumann Theory Prize in 1984, the Medal of the Industrial Research Society in 1985, the IEEE Engineering Leadership Recognition Award in 1988, the National Medal of Science awarded by the President in 1988, the Arthur M. Bueche Award of the National Academy of Engineering in 1993, the Heinz Award for Technology, the Economy and Employment in 1998, the Madison Medal Award of Princeton University in 1999, the Sheffield Fellowship Award of the Yale University Faculty of Engineering in 2000, the International Federation of Operational Research Societies’ Hall of Fame in 2005, and the Harold Larnder Prize of the Canadian Operational Research Society in 2006.
While continuing his research on integer programming Gomory has written on the nature of technology development, research in industry, and industrial competitiveness, and on models of international trade involving changing technologies and economies of scale. He is the author, with Professor William Baumol, of the book Global Trade and Conflicting National Interests (MIT Press 2001).
Manufacturing Growth Is Fastest In 2½ Years
in Uncategorized/by MAM TeamIt was the fifth straight gain for the index. A measure of new orders rose slightly, while a gauge of production fell but remained at a high level. Factories added jobs, though at a slower pace than the previous month.
A measure of export orders jumped to its highest level in nearly a year and a half, a sign of improving economies overseas.
Factories also benefited from a robust U.S. auto industry that is having its best year since the recession began.
Car sales have soared this year and overseas growth in Japan and Europe has picked up a bit.
China’s economy has also picked up after slowing earlier this year. A measure of manufacturing in China, released Friday, showed its best improvement in seven months.
Still, the shutdown slowed activity at companies that make metal products and electrical equipment, according to the ISM survey.
And factories barely increased their output in September, the Federal Reserve said on Monday. Automakers produced more, but that gain was offset by declines at companies that make computers, furniture and appliances.
Companies reduced demand for long-lasting factory goods in September, the Commerce Department said last week. Orders for industrial machinery, electrical equipment and other core capital goods fell 1.1%. August’s orders were revised down to a 0.4% gain, from 1.5%.
Economists pay particular attention to core capital goods, which exclude aircraft and defense-related goods, because they reflect business confidence.
Still, economists don’t expect manufacturing to boost economic growth in the coming months. Growth likely fell to an annual rate of just 1.5% to 2% in the July-September quarter, down from a 2.5% pace in the April-June period. Most economists expect similarly slow growth in the final three months of the year.
Contributing: Associated Press
Buy American? Sure, When It Makes Sense
in Made in USA, Uncategorized/by MAM TeamThe Real Reason Why Washington Should Care About Manufacturing
in Uncategorized/by MAM TeamAnd getting the answer right is imperative because many economists, like Nobel Laureate Gary Beckerand Columbia’s Jadish Bhagwati, persist in trying to convince policy makers that America can thrive without manufacturing, and in fact would be better off without it.
Here are some reasons that don’t really matter. Read more: http://www.industryweek.com/global-economy/real-reason-why-washington-should-care-about-manufacturing
Why America Needs a National Manufacturing Strategy
in Uncategorized/by MAM TeamUnfortunately, manufacturing in the United States has lost competitive advantage in the last 15 years and unless this turns around significantly it will continue to be a drag on our efforts to fully recover from the Great Recession.
There is no inherent reason the United States could not run a significant trade surplus in manufacturing. America possesses the tools, talent, and resources to revive industrial production and our innovation economy.
Read the entire article: http://www.industryweek.com/competitiveness/why-america-needs-national-manufacturing-strategy?page=1
Consumer Confidence Plunges On Shutdown
in Uncategorized/by MAM TeamConsumers became particularly pessimistic in their outlook on the economy six months from now, while their assessment of current economic conditions declined by much less. They also expect less hiring in the months ahead. Consumers’ confidence is closely watched because their spending accounts for 70% of economic activity.
Americans became more confident in the spring as job gains were healthy and economic growth improved. The Conference Board’s measure reached 82.1 in June, the highest in 5 ½ years. That’s still below the reading of 90 that is consistent with a healthy economy.
Confidence has dropped in three of the four months since June. The shutdown already caused a drop this month in the University of Michigan’s measure of consumer sentiment. Americans made more negative references to the federal government’s impact on the economy in October than at any time in the 50-year history of the survey, the university said.
Falling confidence can cause Americans to spend less, which would slow the economic growth. But sometimes consumers spend more, even when they say they are less confident.
Weaker job growth is also weighing on consumers’ outlook. Employers added an average of just 143,000 jobs a month from July through September. That’s down from 182,000 a month in April through June and 207,000 in the first three months of the year.
Sluggish spending is likely to weigh on economic growth. Most economists predict growth slowed in the July-September quarter to an annual rate of about 1.5% to 2%, down from a 2.5% rate in the April-June quarter. And the shutdown is likely to keep growth at a tepid pace for the final three months of the year.