Let’s look at U.S. manufacturing in 2014. There’s been a lot of hopeful buzz that 2014 is going to be a big year, or at least, a better year than 2013. The economy is improving and there’s increased demand for Made in America goods. Could this be the recipe for a strong 2014?
As Stephanie Clifford has been reporting in The New York Times so thoroughly, there’s reason to be skeptical. With the off-shoring movement of the 90's went not only the infrastructure of factories (machines, etc.) but also a skilled labor force.
Now, the modern factories that did survive by adapting and embracing high tech machines demand a labor force with different skills. It’s not that workers have been totally replaced by machines and robots as we tend to think sometimes, it’s that they they’ve been replaced by other workers who specialize in running the robots and machines. Good jobs but fewer in number.
Welcome to 2014.
But there’s real demand for American made goods. As cited in Clifford's piece, 68 percent of consumers prefer American-made goods. Walmart just announced it’s creating a $10 million fund for American manufacturing, even if that’s peanuts compared to their 2013 revenue of $460 Billion, it’s the thought that counts.
“I am getting more and more inquiries from designers and apparel companies who want to make things here in the U.S.,” Jeanne Carver, who runs a wool ranch operation, told ACL recently in her interview about the production of the new Ralph Lauren Olympic uniforms. “This renewed interest in Made in America has been fairly new in just the past three years or so, and it melts my heart. 15 years ago, all I heard was wool had no value anymore.”
Wool is one textile that does seem to be making a modest comeback too and not just for sweaters. Patagonia is doing amazing things with wool, like lining their cold water wetsuits with it. And, the second largest wool mill just opened in Minnesota, but with eight employees the economic impact isn’t going to be huge.
One problem I hear, and Carver touches on this in her interview, is concern that domestic factories may not be able to meet this renewed demand for Made in America goods. Though if you talked with some of the younger brands at the Capsule show this week in New York, you might find that hard to believe. I met a group of designers who were making all order of bags, shirts, jackets and products domestically. Meeting demand wasn’t much of a problem for any that I spoke with, though one did say he had a hard time finding a US-based producer of baseball hats at a cost that worked for him.
And while I don’t think the government can or should be responsible for the state of manufacturing, it’s safe to say President Obama is falling pretty far behind on his goal of creating 1 million manufacturing jobs by the end of his term. Right now, according to the American Manufacturing meter, the country needs about 920,000 more manufacturing jobs to reach that goal.
This as Japan’s President Abe gives the keynote speech at the World Economic Forum in Davos about his success with Abenomics, the bold policy of investing huge capital in public infrastructure, among other things.
One of the first good signs for 2014 are the strong New York Manufacturing numbers for January. So is it going to be a good year for U.S. Manufacturing?
From the business owners that I talk with the answer is yes. There is much more optimism right now. Scott Paul of the Alliance for American Manufacturing looks at much more data in his post and seems to think if we can get our house in order the answer will be a cautious yes (my words not his). I created this blog to cover this manufacturing revival. I’m invested in it, so yeah I'm biased, but I think it will be as well. But will it look like it did in the 1990s before offshoring? No way.
We’ll have more skilled designers here in the U.S. who are prototyping quickly with 3D printers and then getting their products made overseas. The trend for artisanal goods will continue and thrive, and domestic manufacturing will begin to take hold again. We’ll have small manufacturers who resist growth and survive by my making small quantities of super high quality products, because there’s an appreciation for quality right now.
So yeah, 2014 is going to be a big year. Different, but big.