Government, industry, academia partner to devise a unified plan for the future of American manufacturing

April 2017 - What is Manufacturing USA? The federal government partnered with industry, independent experts, and academia and together they built Manufacturing USA, according to a comprehensive study of the concept and its mission by Deloitte Consulting LLP.

Manufacturing USA forms public-private national institutes that focus on critical advanced manufacturing technology areas with strategic impact on the economy. Through eight institutes (listed at the end of this article), Manufacturing USA provides matching federal funding to foster networking and mutually beneficial collaboration between key stakeholders (industry, academia and government) in a “whole-of-economy” approach. The program  encourages industrial R&D investment and serves as a strategic impetus for action, Deloitte’s 76-page report summarizes.

Advanced manufacturing is a critical investment area for the broader domestic economy; support is needed to reverse slowing productivity growth and the trade imbalance. The advanced manufacturing sector has a significant effect on job creation in other industries and contends with expanding foreign competition. 

The “whole-of-economy” design is intended to preserve and grow U.S. competitiveness in advanced manufacturing by creating institutes that convene and coordinate member organizations. 

Manufacturing USA’s institutes help spur research, development and commercialization and prepare the 21st century workforce. The institutes encourage collaboration to catalyze R&D investment and overcome barriers to innovation. They solve collective action problems, allow members to tap into critically valuable and synergistic stockpiles of intellectual property, and provide access to shared assets. This enables innovation to occur more efficiently. 

“Valley of death”

Historically, investments are unevenly distributed across stages of manufacturing R&D and transitioning intellectual property is difficult, inhibiting innovations from reaching the market, the study notes. Manufacturing USA addresses the “valley of death” between research and commercialization by having members conduct work along different parts of the R&D spectrum, and by de-risking investments. 

The institutes lower the cost of R&D experimentation by providing access to expensive equipment, pooling project costs, creating technology roadmaps and exchanging knowledge. This resource delivers greater return on R&D spending for members than they could each achieve on their own. Co-development of technology results in cross-industry and cross-company sharing of information that accelerates technology transition and advancement. 

Talent gap

U.S. advanced manufacturers are experiencing a growing talent gap. Baby boomer retirements, the technical complexity of manufacturing work, a science, technology, engineering, and math (STEM) skills deficit among students, and persistent negative perceptions make it difficult for companies to fill critical roles in a timely manner. 

According to the study, the institutes help industry to mitigate the talent gap by coordinating workforce activities conducted by members and external stakeholders. Workforce efforts include industry assessments of worker supply and demand for technological areas, community engagement events, apprenticeship programs and the coordination of employee credentials and certifications. 

The Manufacturing USA program’s portfolio approach provides enough oversight to ensure federal investments are being spent wisely to improve U.S. advanced manufacturing, while at the same time affording each institute sufficient autonomy to effectively meet the needs of its industry members. 

Connectivity

The number of members, and degree of member connectivity, are key indicators of the sustainability of an institute’s network. Early signs indicate the institutes are reaching the point where organizations see membership as necessary to their own success and seek out membership without being prompted. 

The institutes tap into existing regional clusters and strengthen them, tying innovation efforts to places with strong advanced manufacturing workforces and enabling R&D knowledge spillovers. 

According to Deloitte’s research, U.S. advanced manufacturing supports trillions of dollars of production in other parts of the economy by purchasing from, and selling to, over 80 other industries, ranging from transportation to education. 

Technological advances have an incredible impact on the economy. Workers today produce nine times more goods each hour than workers did 100 years ago. Today, each job in advanced manufacturing supports up to an estimated 16 jobs in the rest of the economy. 

The eight institutes included in the study are: Advanced Functional Fabrics of America, AIM Photonics, America Makes, Digital Manufacturing and Design Innovation Institute, Institute for Advanced Composites Manufacturing Innovation, LIFT, NextFlex and Power America. MM