Where are the real problems in manufacturing?

After we ran a chart in the July issue indicating that the U.S. remains the world’s largest manufacturer – and has lost only 1.1% in global market share since 1984 – a reader sent a scathing e-mail suggesting that American Machinist should be ashamed for trying to lull U.S. manufacturers to sleep.

There’s no doubt that manufacturing in the United States has plenty of challenges. But it isn’t dead; by most measures, it’s not even declining. I’ve been in factory after factory, shop after shop, that are full to the rafters with work; where managers are too busy to think; where owners say repeatedly that they can’t find skilled people to do the work they have.

Local newspapers repeatedly declare that manufacturing is dead in the United States, but what they really mean is that manufacturing jobs are declining – for which they blame everyone from management to the government to the entire population of China. These same local newspapers also proudly report on each new productivity gain that the U.S. manufacturing sector achieves.

What they fail to do is to find the connection between employment and productivity. Every time a productivity increase is reported, it means that jobs have been lost. That’s a tragedy for the people involved, and a great challenge to the U.S. economy – that the backbone of the U.S. middle class for the last half of the 20th century is losing its high-paying jobs.

But they are gone, and we have to deal with it, and one way to do so is to make manufacturing better. I now go into shops that have six or eight CNC machine tools; many of those machine crank out parts in the dark between 6 p.m. and 6 a.m. Monday through Friday – and for 60 unattended hours from 6 p.m. Friday until Monday morning.

That’s productivity. That’s the current state-of-the art for U.S. manufacturing. And that is something to be proud of.

When we ran the chart, I found it encouraging. U.S. manufacturing may not be the 800-pound gorilla it once was, but statistically speaking, it’s still a 791.2-pound gorilla. It’s got a lot of financial and political power, and manufacturers should use that power to support their industries.

We have gone through a bad patch in many sectors of manufacturing but, just because we’ve been batted around, doesn’t mean we have to give up. I’ve been in Europe and in the Far East recently. In Europe, the Germans, the British, the French and the Swiss all complain that they’re losing their manufacturing jobs to China, and that their economies are suffering, and that they can’t get young people interested in manufacturing. Sound familiar?

On the other hand, I saw a report recently that said the country losing manufacturing jobs the fastest is China. That runs counter to what I consider “common knowledge,” so I take it with a large grain of salt, but it said the manufacturing job loss China is a combination of the elimination of job duplication – having three or four operators running one machine, for example – and China adopting automation.

Then, I know a dozen companies that have brought work back from China because they were faced with poor quality, or high costs for inventory and shipping, or the impossibility of shipping from China because the transportation systems in China seem to break down faster than they can be built.

And don’t dismiss the recent scandals over toxic pet food and lead-painted children’s toys. I can’t help but think that the China bubble is about to burst. It’s grown too much too fast.

Ultimately, I think the future remains bright for manufacturing in the United States, and I don’t believe we have fallen as far – or have as many challenges facing us – as some people might think.

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