American Manufacturing Successes

Posted on June 29, 2006  Comments (0)

Lean and Unseen, The Economist:

But someone forgot to tell American manufacturers the bad news. Most of them have enjoyed roaring success of late. Net profits have risen by nearly 9% a year since the recession in 2001 and productivity has been growing even more rapidly than is usual during economic expansions

Yes, as I have been saying the demise of manufacturing in the USA has been exaggerated in the popular press (Global Manufacturing Data by Country – US Manufacturing Plant Construction – Manufacturing and the Economy). Manufacturing jobs have decreased dramatically, both in the USA and the entire world. This decrease of manufacturing jobs worldwide is the most significant change. The manufacturing jobs moving from one country to another is also true but is reported much more than is justified in comparison to the overall decrease in jobs.

Gordon Hunter, Littelfuse’s chief executive, is confident that America can maintain its edge in manufacturing. He is an engineer from the north of England who spent much of his earlier career working for Intel, a semiconductor firm, in California. American firms will keep on improving their productivity, he says, because of a business environment that embraces innovation. “Being flexible and willing to learn are skills that America still excels at,” he says. Eventually, perhaps even GM will get the hang of it.

The key to maintaining the manufacturing position will be a large number of factors. Innovation is important but lately that is becoming a buzzword for “magic bullet.”

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