Bringing Back America's True Manufacturing Advantage
Published on : 10/19/2022
To remain competitive in the global manufacturing industry, the United States must increase manufacturing productivity. The world is becoming more complex, and manufacturers must traverse it more efficiently than ever. In addition, customers expect greater customization and choice as they produce more products in fewer quantities with shorter life cycles. To address these concerns, the Trump Administration is taking several initiatives.
The first pillar is to boost the United States competitiveness as a manufacturing location by growing domestic production and investing in infrastructure. The second pillar focuses on enhancing innovation, including R&D investments and establishing a National Network of Manufacturing Innovation. Finally, the third pillar advocates for human capital investment, rehabilitating a dysfunctional immigration system, and pursuing free-trade agreements with other countries.
The next decade will see dramatic changes in manufacturing, and the United States can significantly impact the global economy. Companies will find growth in new value chain segments as technology unlocks productivity benefits. Moreover, these manufacturing innovations will assist in turning the tide in the US manufacturing sector, giving the country a chance to reclaim its true manufacturing superiority.
Another benefit for American industry is the availability of low-cost energy. Natural-gas prices in the United States were only a third of those in Europe and Asia in mid-2013. This attracted energy-intensive businesses such as fertilizer, steel, and chemicals to the United States. According to research by the Information Technology and Innovation Foundation, these energy advantages brought 500,000 manufacturing jobs to the American economy.
Finally, the author contends that US industrial policy was founded on a sort of national security capitalism. The desire to secure the country's nascent nation against foreign invasions impacted the country's industrial policy. In turn, import substitution and industrial protectionism were defended as critical to national security.
