Advanced Manufacturing

the situation

America has the potential to be the global leader in advanced manufacturing. While we might never again produce the majority of the world’s tennis shoes, we hold the greatest competitive advantage in the advanced production of technologies like medical machinery, flexible electronics, nanotechnology, robotics, satellites and aerospace technology.

Companies around the world want to produce these technologies in America because we have the best academic institutions to partner with for research, strong intellectual property laws, and immediate proximity to the world’s most lucrative consumer market. With the right policies, we can create millions of new middle-class jobs in advanced manufacturing and connected industries.

While automation has reduced the total number of employees needed in most factories, manufacturing still makes up a sizeable portion of our workforce and our economy. In addition to the skilled manufacturing technicians who now do the work of several assembly line workers, this industry requires an increasing number of information technology and software specialists, mechanics, scientists, engineers, managerial positions, sales and administration, transportation and logistics personnel, etc.


here's what we're doing about it

 

policy solutions

-CREATE AND IMPLEMENT A NATIONAL MANUFACTURING STRATEGY: America needs a comprehensive, multiagency national manufacturing strategy. This strategy would require feedback from a number of different stakeholders, to include government agencies, private companies, academic institutions, etc. Its goal would be to create a strategy for American dominance in the breakthrough technologies, military capabilities, and disruptive products that will change the way that people live and work in the 21st century. With the right policies, America can lead the greatest era of innovation in human history.

-DOUBLE THE CURRENT NUMBER OF MANUFACTURING INSTITUTES FROM 14 TO 28: Over the past several years, America has embarked on a brilliant manufacturing initiative. Originally entitled the National Network for Manufacturing Innovation (or NNMI), this program creates regional manufacturing institutes which explore and advance the most high-impact, high-demand, new technologies which can be created here in the United States. The institutes that have been created are already churning out new patents, new products, creating new jobs and supporting local manufacturing. We must expand the current number of institutes in order to accelerate American innovation in the most high-value and high-growth technologies such as flexible electronics, lightweight metals and durable materials, photonics, 3-D printing, renewable energy, and more.

-IMPLEMENT THE MANUFACTURING ENGINEERING EDUCATION GRANT PROGRAM: There are many goals when it comes to product commercialization and small business development on university campuses. We want programs related to these endeavors to increase partnerships between academic institutions and investors, increase the number of students pursuing degrees in needed fields (like engineering), ensure that their scientific studies can also translate into product innovation, attract private industry R&D funding, start new businesses and increase regional economic development. In all of these endeavors, the Manufacturing Engineering Education Grant Program is a clear guideline for how best to move forward.


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policy solutions

CREATE AND IMPLEMENT A NATIONAL MANUFACTURING STRATEGY:

The reasons for American companies hesitating to expand manufacturing facilities, foreign firms showing reluctance to invest in US factories, and students neglecting manufacturing as a viable career, can all be traced back to one root cause. It is the belief that America is not committed to manufacturing. From China to Germany, from India to Japan, all of our leading competitors have implemented national manufacturing strategies which explicitly detail the government’s efforts to advance this vital sector. Such an initiative reflects real commitment and eliminates uncertainty among companies, investors and workers.

America needs a comprehensive, multiagency national manufacturing strategy which amalgamates the challenges and opportunities presented by public, private and academic initiatives in the manufacturing sector. This strategy would require feedback from a number of different stakeholders, as detailed below, but would be finalized by the National Institute of Standards and Technology (housed within the Department of Commerce). Its goal would be to create a strategy for American dominance in the breakthrough technologies and disruptive products that will change the way that people live and work in the 21st century. With the right policies, America can lead the greatest era of innovation in human history.

This strategy would then be approved by Congress, giving voters a voice in the final product. As true technical expertise would be utilized throughout the creation of the national manufacturing strategy, the approval of Congress would mostly give the strategy legitimacy and assure the private sector that the stated goals will be achieved.

The strategy should include:

1. Input from state governments and local economic development agencies related to regional strengths and opportunities.

2. Strategies for increased collaboration between the public and private sectors as well as academic institutions.

3. Strategies for rural community specific manufacturing initiatives.

4. Manufacturing specific workforce needs, and opportunities for better workforce development programs.

5. A plan for creating cross-agency manufacturing objectives which incentivize better coordination between government departments and easier disbursement of grants related to specific technologies or manufacturing processes.

6. A comprehensive list of government grants as well as their requirements and intent. The strategy should identify recommendations for adding, eliminating or altering grant opportunities.

7. Feedback from private industry related to regulatory hurdles and impediments. While worker and environmental protections must remain in place (another reason why voters should get a voice through Congressional approval of the manufacturing strategy) our manufacturers are inundated by mountains of redundant regulations, many of which could be eliminated without affecting safety or environmental protections.

8. Recommendations for manufacturing specific tax policies that require Congressional approval.

9. A thorough evaluation of successful manufacturing practices utilized by other nations and an analysis of ways in which America can emulate those policies.

10. An analysis of unfair foreign trade practices which may be harming American manufacturing and ways of penalizing or countering these practices.

DOUBLE THE CURRENT NUMBER OF MANUFACTURING INSTITUTES FROM 14 TO 28:

Over the past several years, America has embarked on a brilliant manufacturing initiative modeled after Germany’s Fraunhofer Institutes. This initiative, originally entitled the National Network for Manufacturing Innovation (or NNMI), creates regional manufacturing institutes which explore and advance the most high-impact, high-demand, new technologies which can be created here in the United States.

Currently, less than 15 of these institutes are fully completed but those that are operational have already created countless middle class jobs, trained the local workforce to be skilled technicians, catalyzed innovation, produced numerous new patents, attracted foreign investment and supported small to medium sized local manufacturing companies. These institutes are dedicated to the advancement of the most high value and high growth technologies such as flexible electronics, lightweight metals and durable materials, photonics, 3-D printing, renewable energy, and more. As a result, the institutes are essential to providing America the greatest competitive advantage in new technologies related to healthcare, energy, consumer products and military technology.

So, what makes these institutes so special? The collaboration of public, private and academic components catalyzes demand-driven innovation around breakthrough technologies. The proper utilization of all three contributing bodies is the secret to the success of the institutes.

The private companies identify the areas of research and innovation that will have the greatest impact. However, the risk of pursuing new technologies can be too daunting for many companies (especially small manufacturing firms). This is where the support of the public partner is pivotal, especially in the initial funding of the research institutes. So, the private partner puts up half of the initial funding for the project which is then matched by the public sector at a one-for-one ratio.

Private manufacturing firms (large and small) desperately need these facilities to conduct the R&D and experimentation which will lead to the next breakthrough technology. However, these same companies would be hard pressed to justify to their shareholders the total expense of creating such an institution. The use of public funds overcomes this impediment by matching the private funds.

At the same time, the participation of private industry in the funding model ensures that the NNMI are pursuing technological breakthroughs which clearly have strong market demand. Therefore, the research conducted by the academic partners is industry driven, meaning that the real frontline experts (not Washington bureaucrats) are directing the efforts of these partnerships. The private companies have already identified potential high-value new technologies. The institutes then allow them to partner with America’s research institutions to accelerate innovations which will give the U.S. an edge in 21st century technologies.

Each piece of the puzzle adds value. The contribution of the public sector ensures that America does not lose its competitive advantage in advanced manufacturing due to private sector funding shortfalls. The contribution of the private sector ensures that the resulting technologies created through the NNMI institutions are high demand and high impact. The contribution of the academic institutions ensures that America can both innovate and commercialize new products within the country. These institutes are a win-win-win, and they are crucial to our efforts to lead the world in new technologies and new products.  

It should also be noted that the public component phases out after several years leaving the continued expense of operating and maintaining the institutes in the hands of the private partners. We can see through the willingness of the private sector to engage in such an arrangement that these institutes are of great need to American manufacturers. They would not invest such significant resources if there was not significant reward to be gained. The private sector is willing to carry the cost of these facilities for decades to come, producing countless patents and life changing new technologies in regional institutes across the country. They require support from the government just for the initial stage (though federal funding must be ensured for as long as the institute needs, rather than relying on an arbitrary deadline).

If we advance our production capabilities through research and development conducted via the NNMI, then we will have the most competitive manufacturing sector in the world. It must also be emphasized that in this scenario, the government is not picking winners and losers or altering the marketplace. They are providing the necessary foundation for private industry to innovate and thrive within the U.S. Again, the fact that private industry is matching government dollars and plans to foot the entire bill in less than ten years tells you that there is a real demand for this program within the private sector. If you feel that this is an inappropriate role for government, I would ask you to look at Germany, Taiwan, Japan and other manufacturing superpowers who have similar arrangements. We must double our current number of Manufacturing Institutes from 14 to 28 and we must ensure that they receive adequate funding for an appropriate time frame. Currently, the public funding is supposed to phase out after 5-7 years, but it can take a bit longer than this for unproven technologies to really produce results. Let's not let have a short term mentality about this. If a Manufacturing Institute is not ready to lose its public partner in 5-7 years, the time frame must be extended.

IMPLEMENT THE MANUFACTURING ENGINEERING EDUCATION GRANT PROGRAM:

Colleges and universities bring together some of the brightest minds and most promising talent pools that our nation has to offer. These facilities are teeming with new ideas and inventions. Of course, an engineering student who is living on microwave dinners probably does not have the cash or experience needed to translate these great ideas into marketable products or profitable businesses. This is why numerous institutions have created business accelerators and small business incubators to assist new entrepreneurs in their endeavors to create the next great product of the 21st century.

But there are many goals when it comes to university product commercialization and small business development. We want such programs to increase partnerships between academic institutions and investors, increase the number of students pursuing degrees in needed fields (like engineering), ensure that their scientific studies can also translate into product innovation, attract private industry R&D funding, start new businesses and increase regional economic development.

In all of these endeavors, the Manufacturing Engineering Education Grant Program is a clear guideline for how best to move forward. All of the criteria mentioned above are outlined within the legislation, and they are obligatory parts of the program. The end goal is to increase product innovation on college campuses, attract private investment, manufacture the products in the US, and increase regional economic activity. Each of these outcomes are required in order for a university to meet the requirements of the program and receive funding.

Also, like all intelligent public-private partnerships, this legislation requires universities to attract investment interest from private industry before federal funds will be allocated. Again, we see that the private sector craves these partnerships as much as the university does. This legislation should be expanded as more universities meet its requirements. Additionally, this model can be utilized for other important areas of innovation in addition to advanced manufacturing.

The program is currently under the authority of the Department of Defense but full implementation of the program has not yet been achieved. The DOD must finalize its requirements for the program and implement it fully, and Congress must appropriate adequate funding to support the program. This initiative could prove transformative in our efforts to ensure that America remains the world's most competitive destination for innovation and advanced manufacturing.