Four Ways President Trump Can Help U.S. Manufacturing

Trump CarrierI am not an economist.  I don’t even play one on TV.  I’m just a small business owner who’s spent his life in the most important sector in this economy.

I am, in other words, a manufacturer.

Yet when I hear President Trump dusting off the Laffer Curve, trafficking in 80’s-era supply-side rhetoric, and proposing tax reforms that recall the days of trickle-down prosperity and “voodoo” economics, it gives me real pause.  But, as I said, I’m not an economist and have no intention of debating the subject with you today.

Instead – and given that our president has made it clear he wants to do whatever possible to help U.S. manufacturing – let me offer four suggestions to Mr. Trump, all of which would help me greatly as both a businessman and a manufacturer.

 

Dr. Arthur Laffer, Economist and professor at University of Southern California, with "Laffer Curve" on blackboard, Feb. 23, 1981. (AP Photo)

1. Rebuild America
It’s not as sexy to call it fixing our infrastructure, but the idea’s the same. Let’s rebuild America.  There’s no sector of the economy more reliant on the strength and efficiency of our national supply chain than manufacturing (a chain, by the way, now solely reliant on miles of crumbling roads, bridges, tunnels, pipes, rail tracks and power lines).

And while Candidate Trump made some wild promises in pursuit of the presidency, one, in particular, that he made continues to have merit.  So much so, that President Trump would do well to not only hold onto Candidate Trump’s promise, but act on it.

Yes, it will cost trillions to reimagine and reconstruct the backbone of our economy.  But those dollars would prove to be money, not so much spent on construction, but invested in U.S. manufacturing’s future.

Tens of thousands of displaced and underemployed American workers would find jobs, along with a real sense of purpose. Hard dollars would start moving again among those ever-challenged workers who make up our ever-threatened middle class.

But more than anything, manufacturers like me would save billions in waste, downtime and inefficiency, allowing us to be more competitive abroad.

Infrastructure 12. Reduce Tariffs
The president, for as much as he’s travelled overseas, and for all his ties to the global community, seems strangely unaware of globalization.

Today’s world marketplace has grown radically smaller.  International borders, especially for multinational conglomerates (but even for small businesses like mine), represent not so much barriers to be overcome, as markets to enter and growth opportunities to be leveraged.

Imposing tariffs in an attempt to manipulate the trade balance, while noble in its intent, would be both short-sighted and dangerous.  Globalization is here.  And, if the wisdom of the marketplace has its say, it’s not going away anytime soon.

To deny that, or to try to breathe life into the inflammatory, populist rhetoric that got Mr. Trump swept into office, would constitute economic suicide of the highest order.

Large manufacturers would be hurt.  But small ones like me could be devastated.  New tariffs would invariably trigger return fire from countries across the globe, and put much of our new revenue at risk, while giving many of our current international customers the perfect excuse to start looking for a new supplier.

In fact, the best way to ensure even greater demand for American-made brands and products in the global arena would be for the president to do the opposite; reduce tariffs significantly, if not eliminate them altogether.

Green Mfg3. Increase Green Energy Tax Credits
If President Trump knows anything, he knows the power of a carefully crafted brand name.  Heck, his very presidency is living testament of the power of a strong brand name.

Yet, to embrace the carbon-intensive, 19th Century fuel sources he has – coal and oil, especially – is not only bad decision-making, it’s horrifically bad brand management.

The world marketplace is getting cleaner and greener all the time, fueled by a new generation of upwardly mobile consumers who are younger, more environmentally aware, and in pursuit of what might be called sustainable harmony with the planet.

And goods and services that play on that dynamic, while embracing clean fuel sources, are ones that will continue to steal market share from their archaic, carbon-intensive competitors.

And should U.S. goods suddenly begin to carry the global taint of environmental irresponsibility in developing markets like China and India, not to mention more mature ones like South America and the EU, we manufacturers will suffer – because the Made in America brand we’ve leveraged to expand our businesses will quickly start to stand for something rapidly growing out of favor in the global marketplace.

Like tariffs, the president should do the opposite of something on which he ran. His coal industry/campaign rhetoric notwithstanding, he should impose meaningful tax credits for manufacturers trading in (and reliant on) clean and renewable energy sources.

H-1B VisaBelieve me, that’s the kind of branding message that will resonate with the newest and most upwardly mobile consumers around the globe. And that will help U.S. manufacturing in the very way promoting dirty, unsustainable fuels like coal will help disembowel it.

4. Pursue Sensible Immigration Reform
One thing President Trump seems to have done is learn on the job.  That, as much as anything, is likely why he’s softened his stance on so many issues that not too long ago he wielded like a bloody sword.

Take immigration reform, and especially something called the H-1B visa, a specialty work permit designed to allow U.S. companies to engage and employ highly skilled foreign workers – such as technicians, engineers, and computer geeks.

And, yes, some companies indeed exploit the H-1B visa and use it to underpay workers.  The majority, however, including many manufacturers, use it to fill critical positions that may otherwise  go unfilled for lack of qualified candidates.

Trump Mfg JobsAnd until American workers get up to speed and rededicate themselves as a group to learning the skills necessary to get a good job in today’s manufacturing, the H-1B visa will remain a critical manufacturing tool. It will not only allow U.S. factories to seek and find the best and brightest workers, but it will help us recruit the most talented foreign students as they earn degrees from U.S. colleges.

What’s more, there is likely not a manufacturer in America who does not have at least one valued (and, perhaps, longtime) employee who wouldn’t be deeply impacted by a blanket, by-the-numbers deportation of undocumented immigrants.

I urge the president to think long and hard about that, and what it might mean to American manufacturers, large and small.

Yes, this country needs immigration reform.  And, yes, the sooner that reform happens, the quicker we can put the issue behind us and get on with the business of America – which, as we all know, is business.

ExportsBut, as a manufacturer, I urge President Trump to consider the possibility that, just like so many of the issues he embraced on the campaign trail – and just like the issues at the heart of these four suggestions – the cure he suggested could turn out to be deadlier than the disease.

Want a Good Manufacturing Job? Stay in School.

Skills Gap 3The stories are anything but apocryphal. They’re as real as real can get.

Throughout this country, even as Donald Trump continues to boldly promise to bring manufacturing jobs back from distant shores, tens of thousands of high-paying U.S. manufacturing jobs remain open, begging for qualified men and women to fill them.

Why? Because so many of the same factory workers who’ve been relegated to the sidelines as globalization, technology and automation have changed the very face, shape and nature of manufacturing no longer possess even the most basic skills required to perform them.

Training and development business education concept with a hand holding a group of gears transfering the wheels of knowledge to a human head made of cogs as a symbol of acquiring the tools for career learning.

Today’s manufacturing, you see, is less about physical talents than it is about mental ones. It is less likely to require a specific knowledge of, say, tool-and-die making than it is a deep understanding of (and comfort with) computers, software and all kinds of management, design, modeling and/or production programs.

When the German engineering giant Siemens held a job fair recently in North Carolina to try to fill some 800 positions, over 10,000 showed up. The problem was, only 15% of those wanna-be employees were able to pass a reading, writing and math test developed by the company to target those with roughly a ninth grade education level.

That Siemens plant produces gas turbines. And, because the nature of how gas turbines get manufactured these days, Siemens knew it needed a certain type of worker with a specific aptitude and set of skills – a type of worker that these days, sadly, is becoming a rare and highly coveted commodity.

Skills Gap 5And, as I said, such stories are anything but apocryphal. They’re real. They’re prevalent. And, perhaps most unsettling, they’re increasing in both frequency and regularity.

Though many, including our own president, have apparently not yet gotten the memo, the days of dropping out of high school and landing a career-worthy job with the local smokestack manufacturer have gone the way of the transistor radio, the nickel candy bar, and Pac-Man. Today, if you want even a basic job on a shop floor, you sure as heck better have the mental agility and computer skills to put yourself into consideration for it.

Skills Gap 6As Eric Spiegel, Siemens’ retired president and CEO, said about his company’s operations around the globe, including its turbine plant in the Carolinas, “In our factories, there’s a computer about every 20 or 30 feet. People on the plant floor need to be much more skilled than they were in the past. There are no jobs for high school graduates at Siemens today.”

Even beyond the core facility, the same understanding holds true.

In John Deere, for example, the company’s hundreds of dealerships around the country are routinely tasked with the maintenance and repair of millions of dollars worth of high-end farm, construction and earth moving equipment. As a result, all available jobs in Deere’s service centers require so much more than garage mechanics of a generation ago. As Andy Winnett, who directs a training program for the company at a community college in Washington, told the New York Times, “The toolbox is now a computer.”

Skills Gap 4Indeed, even as Mr. Trump continues to toss about sound bytes about the demise of American factory jobs, a study by Ball State University reveals that 9 out of 10 of all factory jobs lost in the U.S. since 2000 have been lost, not to foreign workers or cheap labor, but to automation.

And, as you might expect, that’s a much messier and far less politically compelling tidbit for a presidential stump speech.

Yet, even all that messiness has not managed to pour cold water on the president’s inflammatory and isolationist rhetoric. Even now, President Trump has just signed an executive order to rework the H-1B U.S. visa program, a program designed to give companies – especially those that, like many manufactures, require a highly trained and technically proficient workforce – access to the most qualified foreign workers.

Skills Gap 2I have been trying to make this point for years, and it’s one I will repeat yet again. The crisis in manufacturing is not an erosion of jobs. It’s an erosion of skills. It is an encroaching and ever-increasing gap between what we factory owners want and need in a worker and what so many of candidates nowadays are capable of providing.

This leaky ship can certainly be righted. But in the end, it’s ultimately not up to shop owners and hirers to do the heavy lifting. It’s up to America’s workers and the thousands of men and women who populate our factory and shop payrolls.

It reminds me a bit of that line from the Shawshank Redemption about every man (and woman) has to choose. He can either “get busy living, or get busy dying.”

Engineer Teaching Apprentices To Use Computerized Lathe

Every American factory worker today – former, current and future – has a choice. Right here. Right now. And it’s pretty simple and straightforward.

He (or she) can choose to jump on the manufacturing train that’s rapidly pulling away from the station and make skill development job #1. Or, as so many American workers continue to choose to do, he can bury his head in the sand and spend the rest of his life wondering where the heck his career, his life, and his once-bright future just went.

 

 

 

SkyART: Mining for Genius in the Inner City

Tim CookIt’s not like Tim Cook is running Apple into the ground. For the time being anyway, the company is more than holding its own.

But let’s never forget, Tim Cook remains a classic right brainer. Tim Cook is not a creator, or a visionary, or much of a dreamer. As he’s proven time and time again since the death of his almost mythic predecessor, Tim Cook is one who likes to color within the lines, and Tim Cook is a man who focuses on things he can see, touch and, in particular, tally.

He’s a corporate leader, in other words, concerned less with creating new breakthrough products for Apple than riding the momentum of the ones already on his shelves.

Steve Jobs 2That was the utter brilliance of Steve Jobs. Steve Jobs was apparently prickly as all get-go. Steve Jobs could be demanding, and distant, and abrupt, and a little quixotic. But Steve Jobs was creative. And Steve Jobs was a man with a right brain as well-developed, inquisitive and in full blossom as, perhaps, any corporate leader in the history of American business.

For that reason, and unlike Tim Cook, Jobs biggest priority at Apple was not sales and marketing. It was new product development and breakthrough innovation, both of them wrapped in an alluring combination of ease-of-use and sleekness-of-design.

Because Steve Jobs knew that with those things as Apple’s North Star, sales and marketing would always follow.

In my sector (and for good reason, mind you) many have been consumed of late with what has become an acronym so popular it now threatens to eclipse the word it replicates. To many, STEM now means Science, Technology, Engineering and Math even more than it means the neck of a flower blossom or a small protrusion from a tree limb.

MFG 4.0To such people, STEM has become their North Star, their one laser-like focus to which all others ultimately pay fealty.

But what STEM fails to take into account is simple, unapologetic and irrepressible creativity; creativity in function, creativity in design, and creativity in integration.

Because, like it or not, STEM is solely a left-brain phenomenon. STEM, taken alone, is more about numbers than it is ideas, concepts, or possibilities. And while STEM, taken alone, might develop a complex algorithm capable of calculating the incalculable, STEM will never be able to paint the Mona Lisa or compose Beethoven’s Fifth.

I believe wholeheartedly in the balance between the development of any child’s right and left brain, both of them in equal measure. I believe that focusing on STEM is critical in today’s educational environment, but no more so that teaching a child to not simply play an instrument or maybe draw a picture, but to appreciate and find beauty in the art those two disciplines make possible.

Kids MfgBecause life has taught me that’s where genius lies, in the matrix of those two sides of the human brain. Genius, far more often than not, dwells in the mind of a child whose right brain is just as developed and stimulated as his left. That’s the matrix (and the educational system, in fact) that produced both Steve Jobs and Bill Gates.

That’s why I have become an ardent supporter of an ambitious but otherwise unassuming program in my hometown called SkyART. SkyART is an initiative designed to bring visual arts training to at-risk young men and women in Chicago’s poorest neighborhoods. Because, as is always the case in any poor (or dangerously underfunded) public school, the very first thing to go is the arts department.

SkyARTAnd, for my money, there is no surer way to keep the insidious cycle of poverty that grips so many of our cities intact than to create generations of poor students who’ve never been schooled in the arts; a educational philosophy designed to teach our poorest children creative thinking, creative questioning and, most importantly, creative problem-solving.

This week, my company hosted a couple groups of students who toured our shop and spoke with employees about what they do for a living. They weren’t necessarily kids from SkyART. They were just school-age kids from the city whose eyes we’re trying to open, if only a touch, to the joys and wonders of a job in what has rapidly become America’s most exciting (and, frankly, misunderstood) sector.

And we had them in because we wanted to show them proof that, when it comes to skill development, career growth, and job opportunities, these days manufacturing takes a back seat to no sector in the economy.

SkyART 2But having those students in put me in mind of SkyART, and reminded me of why I initially became so enamored with it and began to support it so fervently. So, while this essay may read like a shameless plug for the program, it’s really just a heartfelt explanation for why a bold initiative designed to expose the arts to poor kids has become so near and dear to my heart (and, for that matter, near and dear to my business).

Kids Mfg 2Because SkyART (and other programs like it) dares to teach creativity to young minds thirsty for a sip of it; minds who might otherwise never be exposed to creativity’s uncanny role in the process of changing lives, creating new products and, in the end, solving society’s most vexing problems.

STEM is critical, make no mistake – especially in my world. But focusing on STEM at the exclusion of the arts is like trying to teach a child to run a race on one leg – and then fully expecting him or her to win it.

Steve JobsCreativity, on the other hand, is a mental acuity that when combined with the power of STEM can one day (and often when one least expects it) blossom into full blown genius.

And – particularly when it comes to the development, design, and manufacturing of industrial products, such as those my shop sets out to create everyday – I’ll take Steve Jobs over Tim Cook every time.

(To learn more about SkyART, or to support the program, please click here.)