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Remaking 'Made in America' What Advanced Manufacturing Means for the U.S. Economy

 

The Zimmer plant that Mike Hawkins (Ph.D. ’06) steps into today is far different than when he started with the company as a rookie bench chemist in 1980.

Then, the medical technology company’s factory floor was filled with workers polishing prosthetics by hand and each milling machine was manned by a single person. Today, robots complete tasks once only possible by hand labor. And high-speed computerized technology means a factory employee oversees not one, but up to five machines at a time.

Thirty years ago, a day’s work for one factory employee might have resulted in 10 prosthetic joints; now, the same amount of manpower produces 100 units per day, each one more precise than if it had been made by hand.

“The pace of sophistication has accelerated,” said Hawkins, vice president of corporate research at Zimmer. “Technology is driving productivity, but it’s also advancing accuracy, which is a competitive advantage.”

In many ways, the Zimmer plant illustrates the hoped-for
future of American manufacturing as a whole: greater automation,
increased accuracy, higher productivity in a high-tech industry.
It’s the kind of factory setting that policymakers point to when they discuss the need for America to remain competitive in its production capabilities, even as the country has lost a third of its manufacturing jobs in the past decade.

Economists disagree on how big of a role manufacturing will play in America’s future, both in terms of jobs and output, as the U.S. economy continues its decades-long transition to a service base. Most concede that the low-wage jobs making low-tech products have disappeared for good. However, it’s clear that manufacturing still plays a vital role in the U.S. economy, providing nearly 12 million jobs and representing up to 60 percent of U.S. exports, according to federal economic reports.

Is manufacturing destined to become a stepping stone in America’s evolution, contributing a significant but smaller piece of the economic pie? Or does it hold the keys to a resurgence of American enterprise, even in industries many considered long ceded to China and other developing countries?

What is the future of “Made in America”?

Revolution: Part I and II

To answer what the future of manufacturing in America might look like, it’s worthwhile to trace the arc of its development by taking a look at the past.

“The truth is, manufacturing as an industry is always changing,” said Mike Molnar (EMBA ’02), chief manufacturing officer at the National Institute of Standards and Technology and director for the Advanced Manufacturing National Program Office, two efforts created by the federal government in the past year to support the growth of domestic manufacturing.

He pointed to a recent special report on manufacturing and innovation published in The Economist (April 21, 2012), which characterized three revolutionary ages: The first was in Great Britain in the late 18th century, when the cotton mill replaced the hundreds of weaver cottages and essentially became the first factory. The second was ushered in by Henry Ford in the early 20th century, when he introduced the moving assembly line and the age of mass production.

It’s worth a pause here, because this is the age that most Americans tend to identify manufacturing with—the “Golden Age” of basically 1950 to 1973, when heavy manufacturing led to the greatest growth in the U.S. economy in history.

“During that period, there was growth not just in production, but in real household incomes, which gave rise to a burgeoning, powerful middle class,” said Jeff Bergstrand, Notre Dame finance professor and economist. “And more than that, there was a sense that all of America shared in the economic boom, with the assembly line tethering us like an anchor to shared prosperity.”

It was a time when American ingenuity and productivity propelled manufacturing forward; however, it also was a period when many of the country’s biggest competitors—Japan, Germany, Britain and France—were leveled by World War II, noted Bergstrand. “Today, not only are all of those countries competing against us, but so are China, India and other countries in South America and Africa—countries with very large and growing populations,” he added.
 

CONTINUED: Remaking 'Made in America'
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COMMENTS

By Dale Weaver | Exec. MBA 2002 July 28, 2012 07:06 AM

This article is very helpful at describing the complexities of US manufacturing past, present and future. Another component of the discussion which I have witnessed is a result of consolidation, particularly where highly successful lean manufacturing, often with family origins, becomes strategic bait for their larger, less efficient, competitors only to gradually lose their once attractive edge as they over time conform, for a variety of reasons, to the mean of the larger conglomerate. This process eventually may lead to job loss locally though not to the extent seen where consolidation simply results in the demise of smaller, less efficient, businesses. This process, while creating wealth, often results in both loss of efficiencies and loss of jobs.

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