manufacturing | Human-Centered Change and Innovation

Elevating the Importance of Construction and Manufacturing

GUEST POST from Mike Shipulski

Restaurants aren’t open as much as they used to be because they cannot hire enough people to do the work. Simply put, there are too few people who want to take the orders; cook the food; deliver food to the tables; clear the tables; and wash the dishes. Sure, it’s an inconvenience that we can’t get a table, but because there are other ways to get food no one will starve because restaurants open. And while some restaurants will go out of business, this situation doesn’t fundamentally constrain the economy.

And the situation is similar with manufacturing and construction: no one wants those jobs either. But, that’s where the similarities end. The shortfall of people who want to work in manufacturing and construction will constrain the economy and prevent the renewal of our infrastructure. Gone are the days of relying on other countries to make all your products because we now know it’s not the most cost-effective way to go. But if there is no one willing to make the products, there will be no products made. And if there is no one willing to build the roads and bridges, roads and bridges will suffer. And if there are no products, no good roads, and no safe bridges, there can be no strong economy.

While there is disagreement around why people don’t want to work in manufacturing and construction, I will propose three for your consideration.

Firstly, the manufacturing and construction sectors have an image problem. People don’t see these jobs as high-tech, high-status jobs where the working environment is clean and safe. In short, people don’t see these jobs as jobs they can be proud and they don’t think others will think highly of them if they say they work in manufacturing or construction. And because of the history of layoffs, people don’t see these jobs as secure and predictable and don’t see them as reliable sources of income. This may not be the case for all people, but I think it applies to a lot of people.

Secondly, the manufacturing and construction sectors don’t pay enough. People don’t see these jobs as viable mechanisms to provide a solid standard of living for themselves and their families. This is a generalization, but I think it holds true.

Thirdly, the manufacturing and construction sectors require specialized knowledge, skills, and abilities skills that are not taught in traditional high schools or colleges. And without these qualifications, people are reluctant to apply. And if they do apply and a company hires them even though they don’t have the knowledge, skills, and abilities, companies must invest in training which creates a significant cost hurdle.

So, what are we to do?

To improve their image, the manufacturing and construction trade organizations and professional societies can come together and create a coordinated education program to change what people think about their industries. And states can help by educating their citizens on the importance of manufacturing and construction to the health of the states’ economies. This will be a long road, but I think it’s time to start.

To attract new talent, the manufacturing and construction sectors must pay a higher wage. In the short term, profits may be reduced, but imagine how much profits will be reduced if there are no people to build the products or fix the bridges. And over the long term, with improved business processes and working methods, profits will grow.

To train people to work in manufacturing and construction, we can reinstitute the Training Within Industry program of the 1940s. The Manufacturing Extension Partnership programs within the states can be a center of mass for this work along with the Construction Industry Institute and other construction trade organizations.

It’s time to join forces to make this happen.

Image credit: Pixabay

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The New Reinvigoration of American Manufacturing

As wages and shipping costs rise abroad, unemployment stays high at home, and strategic discontent with offshoring grows, U.S. Manufacturing finds itself facing its best chance at staging a comeback.

American companies are considering a reversal of offshoring and outsourcing to reduce risk, improve agility, shorten product development cycle, and improve their ability to simplify increasingly complex supply chain management.

Missing from this list is innovation, but US companies that commit to engaging American workers in their innovation efforts may also increase their ability to justify manufacturing their products at home.

As wages and shipping costs rise abroad, unemployment stays high at home, and strategic discontent with offshoring grows, U.S. Manufacturing finds itself facing its best chance at staging a comeback.

Moreover, Chinese workers are now three-to-five times more expensive than some other Asian workers, leading American firms to reconsider their sites of production.

One such firm is Nike, whose innovative Flyknit technology could allow it to make shoes easily anywhere in the world by having a machine make the most labor-intensive parts of the shoe. To bring production back to the United States allows Nike to react faster to competitors or to increase the speed of scheduled product launches. In the fashion industry, speed is crucial, and onshore production could create a competitive advantage.

Other firms are taking a second look at their reliance on contract manufacturers in China and elsewhere. Companies that once saw contract manufacturing as a strategic or economic necessity are questioning the wisdom of the arrangement as they watch original design manufacturers like HTC move up-market and strengthen their brands to compete with Apple, Motorola and others.

Adding fuel to the fire are rumors of workers at plants like Foxconn smuggling out plans and components to sell to pirates to make a little cash on the side.

But more importantly, an almost religious focus on cost and increased use of standard components across whole industries has made it more difficult for one brand to differentiate their products from another in the industry – increasing price competition and squeezing margins for all.

As a result, companies like Apple are now looking to reverse some elements of their standardization and outsourcing strategy and instead become more vertically integrated. Apple has acquired a chip design firm — and even their own chip fabrication plant (fab) — in its quest to differentiate itself and control some of its basic inputs and it may still acquire another fab to continue this strategic direction. Not to be outdone, Google is acquiring Motorola, and Nokia and Microsoft are working together closer than before.

It is possible for companies to manufacture their products in the United States and make a profit. When you invest in your workers, engage their hearts and minds and involve them in the innovation process, you can not only optimize your manufacturing processes but also uncover new growth opportunities that no contract manufacturer will ever bring to you.

Companies like New Balance, Snapper Mowers, American Apparel, Caterpillar, Syntax-Brillian (Olevia TV’s), Case IH, American Bicycle Group and many others have been working hard to keep making their products in the United States.

Now is the time for the Obama administration and state and local governments to step up their encouragement of US manufacturing. In these difficult economic times, Americans would love nothing more than to stroll down the aisles of their local Walmart, Target, or independent retailer and find more products on the shelves that say Made in the USA.

This article originally appeared on The Atlantic