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Focus: Manufacturing

Feature Article from Our Manufacturing Subject Area - See All

From SCDigest's On-Target E-Magazine

- Jan. 8, 2014 -

Supply Chain News: Resurging US Manufacturing Will Look Different, More Automated - but Still Good


Boston Area Firm Machine Inc. Provides a Glimpse at the Future of US Manufacturing


SCDigest Editorial Staff

At Machine Inc. in Stoughton, MA, aerospace and other parts are made more by robots than people. Largely gone are manual milling and machining operations, once a cornerstone of US manufacturing and thousands of mom and pop shops.

For example, inside the company's walls a block of solid aluminum is fed into an automated milling machine, and sometime later out pops a detailed manifold, with eight different holes in it to channel oxygen inside an airplane engine.

SCDigest Says:


The aluminum stock needed for creating the manifold at Machine Inc., likely came from a US mill, not one overseas as would probably be the case if the part had been created offshore.

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According to a recent story on NPR, there are more machines and robotic arms operating on the factory floor than there are actual people running all this equipment. At lunch breaks and overnight, the people disappear, but the robots keep toiling. But it's that low number of employees that allows Machine Inc. and many others to stay competitive and increasingly thrive, matching or staying below the costs of less automated, offshore suppliers, often with better quality and almost always more flexibility and responsiveness.

In the very slow recovery in US job creation, manufacturing has been viewed as something of a bright spot. Since 2010, the US has added back almost 700,000 manufacturing jobs, which sounds like pretty good news - but also not so great when compared with the 7 million manufacturing jobs lost in the previous three decades.

Machine Inc. and a growing number of other manufacturers show it is unlikely that very many of those 7 million jobs are coming back, even if actual production levels continue their rise. For example, Parkdale Mills recently re-opened a factory near Gaffney, SC that now produces 2.5 million pounds of yarn a week with about 140 workers. In 1980, that production level would have required more than 2,000 people, the company says (See More than 20 Years Later, Is Quick Response Going to Revive US Apparel and Textile Sector?)

But within that dynamic , often overlooked are the other jobs a given successful manufacturing operations spins off. Someone has to make and install that robotic equipment, and many of those jobs are likely to be in the US. The aluminum stock needed for creating the manifold at Machine Inc., likely came from a US mill, not one overseas as would probably be the case if the part had been created offshore.

And many services are also required, from insurance to janitorial, supporting or creating jobs that would not be here if the work was performed overseas or in Mexico.

There is still mixed opinion on the state of US manufacturing. Much of the evidence remains anecdotal. There is no question that US manufacturing is on the rise, but many don't realize it is still below peak 2007 levels.

(Manufacturing Article Continued Below)



The monthly manufacturing output numbers from the Federal Reserve show that US production in December was up to an index level of 97.2. That continues the stead y climb from the bottom in June 2009 during the recession, when the index was at just about 80, meaning manufacturing output was 20% below the baseline (and peak) year of 2007. It also means some seven years later, total output is still 2.8% below the peak, though a number of industry sectors have gone well above their 2007 levels.

The founder of Machine Inc. is bullish, telling NPR that the staff is up 30% from pre-recession levels, and he plans on hiring more. But Richard Mileika also says he has a hard time finding the skilled workers needed to successfully run the equipment, an increasingly common complaint. In response, community colleges and technical schools are adding new programs to meet the demand, and some companies are developing Euro-style apprentice programs to meet needs in the US.

The aging of the US manufacturing workforce is another issue, likely to create hundreds of thousands of openings as a wave of retirement hits, and at the same time probably drive more use of automation as the labor dynamic shifts.

Barry Bluestone, an economist at Northeastern University in Boston, has been studying manufacturing for years, including many surveys and site visits. He says overall US manufacturers "tell us their number 1 issue is where will the skilled workers come from to replace those that are retiring today?"

Two other forces are also likely to significantly impact manufacturing over the next decade or more: so called "3D printing" to produce parts and products, and breakthroughs in nanotechnology that could create entire new products and industry sectors.

What's your take on the state of US manufacturing? Will we see more successes such as Machine Inc.?
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